Gilenya was supposed to be the multiple sclerosis front runner, taking market share from treatments that have to be injected or infused because it's taken orally. Instead Gilenya looks to be coming up lame in the race.

The Food and Drug Administration slapped a more restrictive label on Gilenya after a patient died last year within a day of starting the multiple sclerosis treatment. The connection between the drug and the death isn't entirely clear, but the FDA doesn't want patients who have had a stroke or other heart issues to take the drug. The agency also recommended increased monitoring of patients after their first dose, including hourly pulse and blood pressure monitoring and an electrocardiogram at the beginning and end of the monitoring period, which lasts at least six hours, but potentially longer if there are heart complications.

The more restrictive label is bad news for Novartis (NYSE: NVS), Gilenya's developer, but it's good news for every other multiple sclerosis drug: Biogen Idec's (Nasdaq: BIIB) Avonex, Bayer's Betaseron, Teva Pharmaceuticals' (Nasdaq: TEVA) Copaxone, and Rebif from Merck KGaA and Pfizer (NYSE: PFE).

Risk stratification of Biogen and Elan's (NYSE: ELN) Tysabri has brought it closer to a first-line treatment, and Tysabri might benefit most from Gilenya's safety issues because it's delivered by infusion once a month. That's not as convenient as popping a pill daily, but needle-phobic patients might prefer it over daily injections.

It'll be interesting to see how the safety issues affect Biogen's oral multiple sclerosis drug, BG-12, which is under review at the agency. BG-12 is in a different class than Gilenya, so in theory, the bad news shouldn't really affect BG-12. But Gilenya's troubles could affect doctor's perceptions of new multiple sclerosis drugs in general. The old medications work OK and doctors have a lot of experience with them.

Don't be surprised to see BG-12's sales get off to a slow start as doctors prescribe it just to patients who are needle-phobic. Eventually, though, the drug has good enough efficacy to gain traction once doctors get experience with it.

The multiple sclerosis market is huge, but Fool analysts have found a bigger one. Find out what it is and how to profit from it in our free report: "The Next Trillion-Dollar Revolution." Get your free copy by clicking here.