I am absolutely floored. You never know what you will find when you open up the newsfeed first thing in the morning. Some days the most exciting event will be a cat getting pulled out of a tree. Other days you get the biggest story of the year. Today falls into the latter category: The market was hit with a bombshell.

Elan (NYSE:ELN) and BiogenIDEC (NASDAQ:BIIB) announced the voluntary withdrawal of the multiple sclerosis (MS) drug Tysabri from the market.

This is the biggest story to hit the drug sector since Motley Fool Income Investor recommendation Merck (NYSE:MRK) pulled Vioxx off the market last September. Both BiogenIDEC and Elan have been rocked in trading today, down 41% and 68%, respectively, so far.

Tysabri's withdrawal is such a shocker because it was supposed to become the leading drug in the treatment of multiple sclerosis. I have written about Tysabri numeroustimes in the past, and I had the drug pegged as a blockbuster in the making. The drug was so effective in clinical trials that the FDA gave Tysabri a priority review and approved it with only one year of phase 3 data, instead of the normal two years typically required of MS drugs. All signs were pointing toward Tysabri being a true advance in care and the dominant drug in the field.

So what went wrong?
The decision to pull Tysabri was made after there was one confirmed patient death due to progressive multifocal leukoencephalopathy (PML) and another suspected infection. This is a very rare disease that affects only three in 1 million people, so having two cases show up is a red flag.

Both patients had been using Tysabri in combination with BiogenIDEC's MS drug Avonex. At this time it is not known whether the problem is due to the combination of the two drugs or caused by Tysabri itself. Or the cases of PML may be due to factors unrelated to Tysabri. That is a possibility, since both of these patients were taking "multiple therapies for multiple issues," Elan reported.

What now?
Until these issues have been explored, Tysabri was pulled from the market and the ongoing clinical trials have been stopped. The companies are going to look into the cases of all patients who have used Tysabri to see if they can find a link to the drug. Presumably, if other cases of PML are found, Tysabri's withdrawal from the market will be permanent.

However, the door is not necessarily shut on Tysabri at this time -- though that is how the market has responded today. The terms under which sales could resume are yet to be determined, and they will only be known in a few months, after the companies have completed the review of the patients in the clinical trials.

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Fool contributor Charly Travers is the biotech analyst for Motley Fool Rule Breakers. He does not own shares of any company mentioned in this article. The Motley Fool has a disclosure policy.