Momenta shares plunge after supplier receives warning letter from FDA on multiple sclerosis drug

Michael Fein | Bloomberg | Getty Images

An employee works in a lab at Momenta Pharmaceuticals in Cambridge, Massachusetts.

Shares of U.S. biotechnology company Momenta Pharmaceuticals plunged on Tuesday after the firm said Pfizer, a key supplier for its multiple sclerosis drug, has received a warning letter from the and Drug Administration.

Momenta's stock was down more than 15 percent on Tuesday trading at $15.98 per share.

In a release on Friday, the Cambridge, Massachusetts-based company said that Pfizer has indicated that the letter does not restrict the production or shipment of the 20 mg dose of Glatopa, a product that is currently marketed by partner Sandoz in the U.S.

The approval of Glatopa 40 mg, ANDA, will be dependent on the resolution of Pfizer facility compliance issues.

"We are fully committed to work with Sandoz and Pfizer to resolve the recently announced warning letter," Momenta Pharmaceuticals President and CEO Craig Wheeler said in a statement on Tuesday.

Glatopa is a generic version of Copaxone, an injection by Teva Pharmaceutical used to treat patients with relapsing forms of multiple sclerosis.

The company said approval in the first quarter of 2017 is "unlikely."

The company's announcement came ahead of its better-than-expected fourth-quarter earnings results. The company posted earnings of 60 cents per share on revenue of $34.2 million on Tuesday.

Analysts expected the company to report a loss of 24 cents per share on revenue $22.4 million, according to Thomson Reuters consensus estimates.

Despite Tuesday's losses, the stock is up more than 7 percent year-to-date.

CNBC

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