What: Shares of pharma giant AbbVie (NYSE:ABBV) plunged by more than 14% today in late afternoon trading after the company received a warning letter from the FDA related to its two Hepatitis C medications.
So what: The FDA issued a warning related to the company's Hepatitis C treatments Viekira Pak and Technivie, noting that the two drugs can cause serious liver injuries to patients with advanced liver diseases. At least 26 patients around the world have already submitted cases to the FDA related to liver injury that was possibly linked to using Viekira Pak or Technivie, though it should be noted that some of the injuries occurred in patients for whom the medicines were contraindicated.
The FDA noted that any patients taking these drugs should reach out to their providers right away if they develop fatigue, weakness, loss of appetite, nausea and vomiting, yellow eyes or skin, or light-colored stools, as these may be a sign that their liver is being harmed by the medications.
Patients were advised not to stop taking the drugs until they spoke with their healthcare provider first.
AbbVie is now required to add new safety information to the labeling of these two drugs, which certainly took AbbVie's investors by surprise and explains why shares were sold-off so violently.
Now what: Viekira Pak and Technivie are certainly important drugs to AbbVie's financial future, as global sales of Viekira Pak alone topped $385 million in the second quarter, making it AbbVie's second best selling drug. Technivie was only recently approved in July, so investors haven't yet had a chance to see early sales figures yet.
This news also sent shares of Gilead Sciences (NASDAQ:GILD) 6% higher in afternoon trading as its Hepatitis C treatments Harvoni and Sovaldi are the likely choice to fill any void created from doctors not wanting to use Viekira Pak or Technivie.
While it might be tempting to look at AbbVie's stock as a buy after this sell-off, it's probably best to wait until we hear from the company directly about what kind of impact this could have on its financial future before scooping up shares. Investors won't have to wait long, as the company is set to report third quarter results on October 30th, and I'm sure this warning letter and its impact on the firm will be discussed in detail.