It's always tough for a drugmaker or medical-device developer to be on the wrong side of changing medical trends and practices. When you add a failed clinical study, increased competitive pressures, and potential accounting issues, it's no wonder that shares of drug-eluting medical-device developer Angiotech Pharmaceuticals (Nasdaq: ANPI) have fallen about 60% since January 2007.

Angiotech is best known for helping to develop the drug-eluting Taxus stent; it receives royalties on Taxus sales from partner Boston Scientific (NYSE: BSX). The stent competes with offerings from Johnson & Johnson (NYSE: JNJ) and Medtronic (NYSE: MDT) in the U.S., and others in Europe.

Angiotech has had a rough start to 2008. It halted clinical trial testing of its phase 3 Vascular Wrap product candidate last week because of potential safety issues. The company also announced that it would restate earnings from 2006. Piling atop all these issues, the Q1 results Angiotech released yesterday showed flat revenue and negative non-GAAP net income year over year. The year-ago $0.05-per-share earnings gain has become a $0.05-a-share loss so far this year.

Medical-products revenue growth in 2008 is still expected to increase 15% compared to last year. Because of Vascular Wrap's troubles, Angiotech is also slashing its research and development budget and enacting other cost-cutting measures.

There's little to love about Angiotech. It's saddled with $575 million in long-term debt, and its $90 million cash position is dwindling. For this coming year, potential cash flow will turn positive only in the fourth quarter. Meanwhile, Boston Scientific is forecasting another down year for all of its drug-eluting stent sales; it expects worldwide sales of only $360 million to $405 million this year, after bringing in $435 million last year and $506 million in 2006. In short, Angiotech is in a rough position, both financially and competitively.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. Johnson and Johnson is an active Income Investor pick. The Fool has an A+ disclosure policy.