"Many people might think that this is a good thing for ... Aventis, but actually it's not," Webster said. "All manufacturers get tarred with the same brush."

When Chiron Corp. sneezed Tuesday, businesses throughout the healthcare industry -- and beyond -- caught cold. But others may get a shot in the arm this flu season.

Chiron slashed its profit forecast by more than half after British health officials suspended production at the company's Liverpool plant, blocking shipment of some 48 million doses of its Fluvirin vaccine -- almost half the expected U.S. supply. Chiron shares plunged 16%, or $7.44, to $37.98 on Nasdaq.

The fallout spread well beyond Emeryville, Calif.-based Chiron. Novartis, the Swiss drug maker that has a 40% stake in Chiron, slipped 22 cents to $46.60, while Henry Schein Inc., a New York-based distributor of Fluvirin, lowered its 2004 profit forecast to $3.01 to $3.07 a share from as much as $3.61 in August.

Chiron, which was founded in 1981 by three college professors and employs 5,300, makes four influenza vaccines. Its Fluvirin, which was affected by the Liverpool production problem, is the top seller in Northern Europe and No. 2 in the U.S. after the flu vaccine marketed by Aventis Pasteur, a French pharmaceutical company. Chiron also makes Fluvirin in Italy and Germany, but those lots have been committed elsewhere.

Analysts and consultants said the effect on Chiron could be long-lasting. Flu vaccine customers are most concerned about reliability, and failing to deliver could make it very hard for Chiron to sign them up next year, said David Webster, whose Webster Consulting Group advises health firms.

Shares of Aventis rose $1.18 to $86 on the New York Stock Exchange. But it has said the earliest it could make more flu vaccine was after November.

"Many people might think that this is a good thing for ... Aventis, but actually it's not," Webster said. "All manufacturers get tarred with the same brush."

He said the Chiron problem would put pressure on federal officials to line up additional suppliers of flu vaccine, "so Aventis might be facing a couple of new, additional competitors in the next year or so."

That notion buoyed shares of Canadian firm ID Biomedical Corp., which supplies flu vaccine there. ID's shares jumped about 6% on Tuesday.

Vaccine makers also will have to work harder next year to convince people that they should get shots and that the supply will be there, Webster said.

The problems at Chiron, he said, aren't "going to help grow the market or help get people more immunized."


Chiron's Flu Vaccine Woes Infecting Others
October 06, 2004 | Lisa Girion | Times Staff Writer