It may be the disk that has gone, or the electronics inside the case.
One option is to buy a new empty caddy and put the hard disk in there and see if it works.
If you still get the horrible noises then the disk may have gone. Rescuing data off it will be very expensive.
As you have found out having only ONE backup is not a good idea. As an external hard disk can easily be dropped (as you have found) then important data need to be backed in a number of places.
One or more of the following is a good idea
* ANOTHER (second) external hard drive
* A memory stick
* A CD or DVD
* Copied on to another "spare" computer
* Uploaded to free web space (companies like Google and Microsoft, and perhaps your ISP, all provide free web space)
You should also consider a NAS (Network Attached Storage), which plugs into your router and can be accessed by any PC on the network. This can be stuck on a shelf, never moved, and plugged in all the time.
Some NAS come with TWO (or more) hard disks where the same data is coped to both, meaning if one disk fails you still have the data on the other disk (this is called RAID).
As I always say YOU CAN NEVER HAVE TOO MANY BACKUPS
I have two external hard drives, AND a NAS with 2 disks in it, and I copy stuff to a spare computer in our house (I also put some stuff on CD and DVD)