Bayer shares took a nosedive on the stock market as the German chemical and pharmaceutical firm admitted that its anti-cholesterol drug Baycol/Lipobay could be linked to the deaths of 52 people.

Bayer withdrew the drug last week after authorities in the United States said it could be the cause of 31 deaths there. The drug has also has previously been linked with deaths in Germany, Spain and France.

Although the company stressed that there was no proof as yet, the drug is reported to have serious side effects, including fatal muscle weakness.

The news about Baycol has resulted in the company’s shares falling by 16 per cent last Wednesday alone. However, after suffering heavy falls last week, Bayer's shares took the latest news calmly, falling only slightly in early trade on Monday.

Some have speculated that Bayer could be forced to sell its pharmaceutical business, which is in any case thought to be too small to compete in the rapidly globalising drugs market. (MB)