US pharmaceutical giant Cosette has threatened to abandon its $672 million takeover bid for Adelaide-based drug company Mayne Pharma after the target issued weaker-than-expected earnings guidance and disclosed a possible US regulatory issue with one of its key products.

Mayne shares plunged more than 30 per cent on Wednesday after it said private equity-backed Cosette was reviewing the deal because it thought there had been a “material adverse change” in the company’s financial performance since it made its offer in February.