Many stocks encountered turbulence this week, but few were blown about like several biotech stocks. Here are the three most horrendous performers in health care over the first week of June.
Patients taking a combination of ganetespib and the chemotherapy docetaxel lived a median of 9.8 months. Other patients taking only docetaxel lived a median of 7.4 months. That’s a 32% improvement. Even better improvement of 67% was experienced by patients whose cancer was diagnosed at least six months before the initiation of the study. Synta Pharmaceuticals Corp. (NASDAQ:SNTA)’s results sound really good, right?
There are a couple of problems, though. First, results from the study announced late last year indicated more dramatic improvement. Second, the difference in numbers of patient deaths between the two groups of patients is small. Investors appear to be losing confidence that ganetespib will live up to earlier expectations.
No win for the spin
Another biotech, Infinity Pharmaceuticals Inc. (NASDAQ:INFI), also announced clinical results this week. The company’s press release trumpeted “encouraging” findings for its experimental leukemia drug. Mr. Market didn’t appear to buy the spin. Infinity Pharmaceuticals Inc. (NASDAQ:INFI) shares tanked nearly 33% for the week.
The catalyst behind the sell-off stemmed from safety concerns about IPI-145, the drug tested in the phase 1 study. Some patients who took the treatment died, although Dr. Steven Horwitz of the Memorial Sloan-Kettering Cancer Center pointed out early in the week that these patients had undergone transplants and were very ill.
Another issue is fear over potential rivals. Gilead Sciences, Inc. (NASDAQ:GILD), for example, reported in May that its idelalisib produced significant tumor shrinkage in half of the patients involved in an early-stage trial. Dr. Sandra Swain, president of the American Society of Clinical Oncology, called the results “pretty incredible.” Gilead Sciences, Inc. (NASDAQ:GILD) is also testing idelalisib in the treatment of non-Hodgkin’s lymphoma.