Shares in Biogen Idec and Elan Corp have taken a bashing after regulators in Europe started a review of their blockbuster multiple sclerosis drug Tysabri, following reports of several more cases of a potentially deadly brain infection.

The European Medicines Agency’s Committee for Medicinal Products for Human Use has announced that it has begun a review of the benefits and risks of Tysabri,(natalizumab) in view of reports of 23 cases of progressive multifocal leukoencephalopathy worldwide since the drug was reintroduced in July 2006. The committee will “discuss any additional measures necessary to ensure the safe use of Tysabri and how to balance the risks to the patients against the benefits of the treatment”, the EMEA said.

The PML link is well-established but the concern from investors stems from the numbers involved. The last update from Biogen, in July, stated that 11 cases had been reported, and the firm noted then that it would not give updates on a case-by-case basis, but would rather focus on Tysabri’s benefits.

Biogen and Elan have been in talks with the US Food and Drug Administration about changing the label on Tysabri and whether there is a link between the risk of PML and duration of treatment. The agency currently works on a risk limit of one PML case per 1,000 patients.

At the end of the third quarter, around 46,200 people were on commercial and clinical Tysabri therapy worldwide, representing a slight slowdown in take-up of the drug, Analysts believe it is highly unlikely that the FDA or EMEA will suspend Tysabri's marketing authorisation but there are fears about how news of the European review will affect physician/patient sentiment on the drug.

Biogen shares fell almost 7.3% to $43.81, while Elan’s stock sank 20.5% to 3.42 euros.