Nastech Pharmaceutical's

( NSTK) shares plummeted after the Food and Drug Administration rejected its application for calcitonin-salmon nasal spray. Regulators said the drug isn't approvable because of concerns that a possible interaction between its ingredients could harm the immune system.

Nastech plans to discuss its application further with the FDA to see whether additional data could be submitted to support the drug's approval. Shares sank 12.8% to $13.31.

Shares of

Epix Pharmaceuticals

(EPIX) - Get Report

, a maker of drugs used in medical imaging, fell 7.4% to $4.49 after the company said

Schering

( SHR) won't exercise its option on the development of a drug intended to help doctors find blood clots using an MRI.

Schering is merging with another German drug company,

Bayer

( BAY). Epix says it intends to seek another collaborator for the development of the drug, dubbed EP-2104R.

Johnson & Johnson's

(JNJ) - Get Report

shares dipped 8 cents to $60.54 after the company's Cordis medical-device division acquired the privately held wound-closure firm Ensure Medical. Terms of the deal weren't disclosed, but J&J expects to take a charge of $52 million after taxes, or 2 cents a share, for acquired research and development.

Following the close of trading Wednesday, J&J announced positive efficacy results from a trial of its schizophrenia drug Paliperidone ER, saying it significantly delayed the recurrence of symptoms.

Diagnostics-device maker

Biosite

( BSTE) said the FDA cleared its Triage TOX drug screen as a way to identify patients on methadone, a drug that's known to interact with a number of other medications. Shares fell 0.7% to $45.60.

Biopharmaceutical company

Corautus Genetics

(VEGF)

was up 3.6% to 87 cents after the company said the FDA lifted the clinical hold imposed in March on trials of its drug Genasis. The drug is intended to increase the length of time patients with severe angina can exercise.

Corautus says a product application submitted to the FDA will remain on a partial hold as the company expected, until remaining issues, all of which are associated with the results of certain tests related to the delivery-catheter system and injection procedures, are completed.

Medical-technology company

Biolase

( BLTI) rose after the FDA approved its eye-surgery product Oculase MD. Shares were up 5.3% to $7.72.

Other health stocks on the move included

Abraxis Bioscience

( ABBI), which received a $3 million milestone payment from Taiho Pharmaceutical for its initiation of a clinical trial on the drug Abraxane, and

Alexion Pharmaceuticals

(ALXN) - Get Report

, which bought a former

Dow Chemical

(DOW) - Get Report

plant in Rhode Island to manufacture its lead drug candidate, Soliris. Abraxis fell 1% to $22.40, and Alexion lost 1.5% to $34.19.

Also lower in the day were

Tapestry Pharmaceuticals

( TPPH), down 8% to $3,

Cephalon

( CEPH), whose shares fell 2.6% to $62.16,

Genetic Technologies

(GENE) - Get Report

, down 6.5% to $8.32, and

Novavax

(NVAX) - Get Report

, whose shares were 1.8% lower at $4.34.

Among those rising were

Omrix Biopharmaceuticals

( OMRI), up 2 cents to $11.85, and

GenVec

(GNVC)

, up 2.3% to $1.31.