While the federal government now gets to deal with "massive" budget cuts of around 2.3% of total annual federal spending put into law by President Obama and Congress, some investors are left wishing they could be so lucky after the past week. Here are three horrendous health-care stocks for the week with losses that make the levels of sequestration cuts sound like a great deal.
No help for Heplisav Shares of Dynavax Technologies Corporation (NASDAQ:DVAX) plunged 33% this week after the Food and Drug Administration rejected approval for hepatitis B vaccine Heplisav. This wasn't really a huge surprise, though, since the FDA's advisory committee recommended against approval back in November.
The roadblock relates primarily to safety of the vaccine. Dynavax announced that the FDA's response indicated that further evaluation was needed to evaluate safety and that it had concerns that Heplisav could cause rare autoimmune diseases. The agency also needed additional information about the quality control processes for manufacturing the vaccine.
Is Dynavax Technologies Corporation (NASDAQ:DVAX) now dead in the water? Maybe not. The company stated that the FDA "indicated its willingness to continue discussions regarding a more restricted use of Heplisav." Dynavax thinks that it might be able to move forward with a more restricted approval of the drug, perhaps limited to adults over age 40 or patients with chronic kidney disease, without addidtional clinical studies.
No hurry, much worry Accretive Health, Inc. (NYSE:AH) announced this week that it was postponing the release of its fourth-quarter and full-year financial results. The market fretted over the delay, sending shares down 23% for the week.
The company explained the reason for the postponement was that it needed to evaluate how revenue is recognized for revenue cycle management agreements. Accretive didn't think that total revenue would be affected, but the timing in which the revenue was recognized might be.
If adjustments aren't too extensive, Accretive Health, Inc. (NYSE:AH) should recover over time from this week's meltdown. You have to wonder, though, how a company that is in the business of managing revenue cycles for its customers can mess up its own revenue. Accretive's competitors will probably raise that very question for quite a while.
Waiting for weight pill success Investors in VIVUS, Inc. (NASDAQ:VVUS) will have to wait longer for a turnaround in the stock's decline. Shares fell 18% this week, adding to a long slide that began last summer.
VIVUS released its fourth-quarter results on Monday. Unfortunately for its shareholders, those results weren't too great. VIVUS, Inc. (NASDAQ:VVUS) lost $0.56 per share, worse than the consensus analyst estimates of $0.44 per share. Analysts were expecting revenue to be around $4 million, but actual revenue came in far lower at $2 million.