SkyePharma crashes

SkyePharma was battered by the markets today after AstraZeneca stopped production on one of the asthma drugs it developed alongside the smaller British firm.

Skye developed the medicine for Astra's inhaler drug Pulmicort, and earned a royalty of about 15% of Astra's sales, which made up close to 5% of its total revenues.

AstraZeneca said that "complex manufacturing issues related to technical aspects of the device" had made it quit production on the 100 and 200 microgram dose inhaler forms of Pulmicort. "We have exhausted all potential solutions in our efforts to continue supplying this medicine," Astra's executive vice president David Smith said.

"We believe it is in the patient's best interest to find an alternative medication as soon as possible," he added.

Astra's similar products, including Pulmicort Turbuhaler, Pulmicort Respules and Pulmicort Flexhaler, are not affected because they use different devices.

SkyePharma's shares lost 7p to 36.9p, while AstraZeneca rose 7.5p to 2994p.