A federal advisory panel meets Friday to review an experimental pill that supporters say could dramatically affect stroke prevention and provide a much needed boost for the drug's developer, U.K.-based AstraZeneca ( AZN).

But the drug, Exanta, has an Achilles heel that gives experts pause and could delay FDA approval or result in restricted use. Clinical studies show that patients taking the blood thinner have a significantly higher rate of an elevated liver enzyme vs. the market-dominating pill, something that could signal liver damage.

"We believe that investor expectations for Exanta may be too high given the high incidence of liver side effects seen in the clinical development program," said Tim Anderson, a Prudential Equity Group analyst, in a research report in late July when he maintained a neutral rating on the stock. He believes the FDA may take a "cautious stance" on the drug. (He doesn't own shares of AstraZeneca; his firm doesn't have an investment banking relationship with the company.)

The FDA says that drug-induced liver injury is the top cause of acute liver failure, a rare disease that can produce critical illness in a few days, cause death or necessitate a liver transplant. It's the leading reason drugs are removed from the market and why the FDA restricts use of some drugs and requires special monitoring of patients. And it's a major reason why experimental drugs don't reach the marketplace.

FDA approval would herald the first new anticoagulant pill in more than 60 years to challenge the prevailing pill, sold by its generic name warfarin and best known by the brand name Coumadin.

Warfarin is a crucial medication for preventing strokes because it prevents blood clots in the legs and lungs; clots in patients who have had a heart valve replaced with a mechanical valve; and clots associated with an irregular rapid heartbeat called atrial fibrillation. The drug is also given to heart attack patients to lower the risks of death, another heart attack and stroke.

Despite its benefits, warfarin is awkward for patients because it requires them to take periodic blood tests to make sure the drug's anti-clot-forming effort is successful. (Clinical trials show patients can take a fixed dose of Exanta, thus avoiding the constant blood-testing.)

If the warfarin effect is too great, patients can suffer from internal bleeding or other bleeding, such as from the gums during brushing. If the impact is too little, patients remain vulnerable to clots. In addition, warfarin interacts with many drugs, herbal medications and foods that can exacerbate or depress the blood thinner's effect. Exanta has fewer interactions with other products.

AstraZeneca began marketing Exanta in Germany on June 21, having secured European Union regulatory approval in late 2003 for preventing blood clots in patients who had undergone elective hip or knee replacement surgeries. This is a narrow use of the drug, but it's also one for which liver problems would be less likely to arise because patients won't take the drug for a long time. The EU approval calls for the drug to be administered orally for 11 days.

However, the big market -- and big controversy -- will be in chronic uses, such as atrial fibrillation or the installation of a mechanical heart valve. These patients would have to take Exanta for the rest of their lives. AstraZeneca is seeking European Union approval for expanded applications of the drug.

AstraZeneca is seeking FDA approval for three uses: preventing blood clots in veins for patients undergoing knee replacement surgery; preventing stroke and other clot-induced complications of atrial fibrillation; and long-term prevention of blood clots in veins after a patient has gotten a standard blood clot treatment.

AstraZeneca, which submitted its FDA application in late December, is seeking approval based on tests involving more than 30,000 patients. Exanta clinical trial results have appeared in such prestigious publications as The New England Journal of Medicine and The Lancet as well as at major cardiology conferences.

Exanta has proven to be as effective as warfarin in preventing strokes and/or clots, and there was no statistically significant difference in the number of major and minor bleeding events between the drugs. But the same trial that showed these strengths also showed that 6.3% of Exanta patients had an elevated liver enzyme, called ALT, compared to 0.8% of warfarin patients. An elevated level is defined as more than three times the normal ALT level. This test was reported in The Lancet in November, and the company said "nearly all enzyme changes occurred within the first six months of treatment and decreased with or without drug discontinuation."

These mixed results have investment banks worried. "We remain concerned about the approvability of Exanta," said Alexandra Hauber, of Bear Stearns' European equity research unit, in an Aug. 16 report. "We remain concerned about Exanta's liver profile and would not be surprised if the FDA requested further safety data prior to approval in chronic indications."

The FDA doesn't always follow the recommendations of its advisory panels, but it usually does. The agency is expected to make a ruling on Exanta in late October. If the FDA required additional safety tests for chronic conditions such as atrial fibrillation, Hauber fretted that the drug could be delayed until 2006.

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