KV Pharmaceutical Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of drugmaker KV Pharmaceutical (NYSE: KV-A  ) plummeted more than 25% on Wednesday after the Food and Drug Administration said it won't take action against compounders of its pre-term birth drug Makena.

So what: KV seemed determined to take full advantage of its exclusive rights to sell Makena when it raised the price of the drug 100-fold, but the FDA statement suggests that pharmacies will be able to continue marketing a cheaper alternative unperturbed. Of course, the news comes amid ever-increasing outrage from doctors, patients, and politicians toward KV's particularly extreme price hike.

Now what: KV continues to be an uncertain situation. KV management hasn't responded to today's news yet, but you've got to think that there has to be some kind of Makena price reduction coming. Exactly how big of a discount, of course, may end up determining whether today's plunge of more than 25% is under or overdone.

Interested in more info on KV? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1467279, ~/Articles/ArticleHandler.aspx, 10/1/2014 7:02:19 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement