Bio-medical giant Chiron has suffered another devastating attack. Last winter a hippie placed bombs at the Chiron headquarters but this latest blow comes from a staunch ally of America; The UK. British regulators have suspended the company?s Liverpool facility, which manufactures all of Chiron?s U.S. flu vaccine.

British regulators said, in effect, that the Chiron plant had failed an inspection of its general manufacturing procedures. The inspection was triggered last month by the company's disclosure in late August that up to 4 million doses of vaccine had been contaminated and had failed a sterility test.

Chiron makes roughly half of all the flu vaccines for America. The shortage is anticipated to cut Chiron's profits by half.

"This is a huge issue," says Geoffrey Porges, a biotechnology analyst at Sanford C. Bernstein. "It's going to be discussed in Congress; it's going to be discussed at the highest levels in the [Centers for Disease Control]. There's a real likelihood that we will see some fundamental changes in the vaccine market and in vaccine oversight."

This is anticipated to be a particularly deadly flu season, so the shortage is especially critical. Already public health officials are imploring healthy Americans to forgo a flu-shot this year.

This impending crisis has been one that drug companies and health care professionals have grappled with for a while. Flu shots are generally purchased by the government, making the cost low, and subsequently, lowering the incentive for drug companies to manufacture the vaccine. Some have proposed deregulating even more the flu vaccine market in order to encourage other companies to manufacture the vital medicine. Others have suggested alternative solutions to the shot. Regardless of future solutions, this winter will certainly be deadly to the weakest among us.

The news is devastating to Chiron's immediate financial future. Shares were down sharply:

Heavy trading on the news wiped out $1.4 billion in market capitalization from the company within hours. Analysts said the unexpected regulatory action was not only a blow to Chiron but also a public health disaster.