Affymax (OTC:AFFY) has collapsed under the weight of a recall of its only product, Omontys. Shares are down 85% in 2013 as what once looked like a promising challenger to Amgen's (NASDAQ:AMGN) Epogen is beset by safety questions that could leave it permanently shelved.

Bizarrely shares of Affymax spiked more than 50% in a single day earlier this month, and despite no hard news backing the move, weary shareholders were hoping this was the beginning of a turnaround.

Unfortunately, that doesn't appear to be the case. Affymax fell another 64% today after disclosing that it was slashing its workforce dramatically and reiterating that it was looking at strategic options including bankruptcy. Amgen was up 2% as Omontys is stuck on the sidelines for the foreseeable future.

Health-care analyst David Williamson tackles the days news and spells out what it means for Affymax and investors.