BOSTON — The makers of Tysabri, a new drug used to treat multiple sclerosis, are voluntarily suspending sales of the drug after one patient died and another developed a serious disease of the central nervous system.

Stocks of both Biogen Idec Inc. and Elan Corp. tumbled, while shares in the makers of rival MS drugs rose. The biotechnology companies said Monday they have suspended supplying and marketing Tysabri and advised doctors to suspend prescribing the medication. The companies also stopped using the drug in clinical trials.

Tysabri has been under review by Canadian health officials and hadn't yet been approved for use in Canada.

The companies said the decision to withdraw the drug came after recent reports of two cases of serious effects among patients who used it along with an earlier Biogen Idec MS drug, called Avonex, in clinical trials.

In one case the person died, while in another the patient developed a suspected case of progressive multifocal leukoencephalopathy, a rare and frequently fatal disease of the central nervous system.

Both patients had taken Tysabri for more than two years in combination with Avonex, the companies said.

"Our ongoing commitment to MS patients has led us to take these steps," said Burt Adelman, executive vice-president of development at Cambridge-based Biogen Idec.

"Because we believe in the promising therapeutic benefit of Tysabri, we are working to evaluate this situation thoroughly and expeditiously. While we work through this matter, we must place patient safety above all other considerations."

The U.S. Food and Drug Administration approved Tysabri, called Antegren during clinical trials, in an accelerated process after a late-stage study showed that it reduced MS relapses by 66 per cent.

About 5,000 patients have received intravenous infusions of Tysabri since the drug's approval in November, Biogen executives said during a conference call with industry analysts and reporters.

Elan CEO Kelly Martin told reporters in Ireland, where the company is based, that the drug has been withdrawn as a precaution and the companies hoped to resume selling it later this year.

Still, even if the drug never comes back, experts said Tysabri has helped advance research in an area that has seen few successes since MS was first identified in 1868.

"We're disappointed," said Dr. Howard L. Weiner, author of a book on MS and director of the Partners MS Center at Brigham & Women's Hospital in Boston.

"But the results that we saw with this drug moved forward our understanding and treatment of MS, and identified an avenue for treatment that is still very much alive."

The companies said they withdrew the medication after consulting with the FDA. Phone messages seeking comment were left at the FDA's press office.

"We are working with leading experts and regulatory agencies to responsibly investigate these events and to develop the appropriate path forward," said Lars Ekman, president of research and development at Elan. "Our primary concern is for the safety of patients."

Biogen shares fell $28.63, or more than 42 per cent, to close Monday at $38.65 US on the Nasdaq Stock Market, while Elan shares plunged $18.90, or more than 70 per cent, to end the day at $8.00 on the New York Stock Exchange.

Those are the lowest prices for both stocks since late 2003.

But the U.S. shares of rival MS drugmakers Schering AG rose $2.00 to $73.10 and Serono SA jumped $3.05, or 20 per cent, to $18.59 on the New York Stock Exchange.

Tysabri was expected to be a big seller for the companies, and sales of Elan shares surged in October amid published reports in Ireland that Biogen could mount a takeover bid for the Irish company.

Elan, once Ireland's highest-flying company and a darling of international investors, subsequently issued a statement saying it was not in talks with Biogen about a merger.

Tysabri -- also known by the generic name natalizumab -- has been designed principally to slow the progression of disabilities related to multiple sclerosis, but Elan and Biogen previously said they believed it could also help sufferers of the gastrointestinal ailment Crohn's disease and rheumatoid arthritis.

In December, the companies announced they were starting a study comparing Tysabri with another MS drug called Rebif. That study was to enrol 1,000 patients.

On Feb. 17, the companies announced favourable Tysabri trial results indicating success in slowing MS in patients who had relapsed, with a 42 per cent reduction in the risk of the disability progressing, compared with patients who took a placebo.