Shares of

Staar Surgical

(STAA) - Get Report

were among the worst-performing health-related stocks Monday, falling 34% after the company warned that the Food and Drug Administration is prepared to take action against the company for failing to correct numerous violations.

In a letter to the company, the FDA said that Staar has "failed to adequately correct numerous violations" that were identified in September 2004. As a result, the "FDA is gravely concerned about Staar's serious, continuing violations and is prepared to seek the appropriate remedies, the letter continued. The letter, which was received by Staar on July 5, 2005, represents the FDA's final attempt to notify Staar of its noncompliance, Staar said. The company now has 10 calendar days following the receipt of the letter to provide responses and supporting documentation to the FDA.

Staar plans to respond to the letter by July 15, "but believes that the FDA will pursue enforcement action against the company if it finds the response inadequate," it said. If the FDA does take action, Staar believes it would likely have a material and adverse impact on the company and its prospects.

Finally, Staar said it continues to believe that its Visian ICL contact lens will not receive marketing approval in the U.S. until all compliance matters have been resolved. Shares were trading down $1.72 to $3.35.

D&K Healthcare Resources

( DKHR) vaulted 68% after the company agreed to be acquired by

McKesson

(MCK) - Get Report

for about $207 million in cash. The deal values D&K at $14.50 a share, representing a premium of 71% over Friday's closing price of $8.50. McKesson will also assume D&K's outstanding debt. The acquisition, which is expected to close in the third quarter of 2005, is not expected to have an impact on fiscal 2006 earnings, but is expected to be mostly accretive to McKesson's fiscal 2007 earnings. D&K, a drug distributor that serves independent and regional pharmacies primarily in the Midwest, Upper Midwest and the South, posted fiscal 2004 sales of $2.5 billion. Shares were trading up $5.81 to $14.31; McKesson was recently trading up 60 cents to $45.15.

Shares of

Keryx Biopharmaceuticals

(KERX) - Get Report

fell 2% after the company said it plans to sell 5 million shares of stock. The sale is being conducted pursuant to an effective shelf registration statement that was filed on Oct. 13, 2004. J.P. Morgan Securities is leading the underwriting syndicate. Shares were trading down 24 cents to $13.82.

Conceptus

( CPTS) rose 13% after the company lifted its second-quarter sales guidance and trimmed its loss forecast. The birth-control device maker now expects sales of $5 million, up from previous guidance of $4.1 million to $4.3 million. Conceptus now expects to report a loss of $6.2 million to $6.5 million, down from an earlier forecast of $6.5 million to $6.7 million. Analysts are expecting the company to report a loss of 25 cents a share on sales of $4.2 million. Shares were recently trading up 78 cents to $6.72.

Shares of

Mylan Laboratories

(MYL) - Get Report

rose 2% after the company said first-quarter earnings would top forecasts and backed its earnings estimates for fiscal 2006 and 2007. The company expects adjusted earnings during the first quarter to reach 24 cents to 26 cents a share. Analysts had been expecting earnings of 19 cents a share. Looking ahead, Mylan reaffirmed fiscal 2006 earnings guidance of 92 cents to $1.15 a share and fiscal 2007 earnings of $1.20 to $1.74 a share. Analysts are expecting earnings of 95 cents a share during fiscal 2006 and earnings of $1.23 a share during fiscal 2007. Shares were trading up 48 cents to $19.89.

Other health care volume movers included

Pfizer

(PFE) - Get Report

, down 17 cents to $26.97;

IMS Health

( RX), up 47 cents to $26.36;

Amgen

(AMGN) - Get Report

, down 54 cents to $68.59;

Able Laboratories

( ABRX), down $1.20 to $1.68;

Schering-Plough

( SGP), up 31 cents to $19.28;

Merck

(MRK) - Get Report

, up 4 cents to $31.04;

Johnson & Johnson

(JNJ) - Get Report

, up 37 cents to $64.65;

Millennium Pharmaceuticals

( MLNM), down 15 cents to $9.69;

Elan

(ELN)

, up 8 cents to $7.31; and

Bristol-Myers Squibb

(BMY) - Get Report

, down 9 cents to $24.82.