The overall markets experienced the biggest one-day losses in quite a while this week. But those drops were pocket change compared with these horrendous health-care stocks.
Shares of small biotech Idenix Pharmaceuticals Inc (NASDAQ:IDIX) took a 32% nosedive this week, following unwelcome news from the U.S. Food and Drug Administration. The FDA told Idenix Pharmaceuticals Inc (NASDAQ:IDIX) that it can’t start human testing of experimental hepatitis C drug IDX20963 yet because more safety data is needed.
As a result, Idenix Pharmaceuticals Inc (NASDAQ:IDIX) was forced to put its planned initiation of the clinical program for IDX20963 on hold. The company will respond to the FDA, but it didn’t say how long that effort would take.
Idenix Pharmaceuticals Inc (NASDAQ:IDIX) has one marketed product thus far — hep-B drug Tyzeka. However, the company sold the rights to the drug to Novartis AG (ADR) (NYSE:NVS) in 2003. At that time, Novartis AG (ADR) (NYSE:NVS) also bought a 54% stake in the small biotech. The two companies restructured their collaboration agreement last year. As a result, Idenix Pharmaceuticals Inc (NASDAQ:IDIX) no longer receives any royalties or milestone payments for Tyzeka. Over the years, Novartis AG (ADR) (NYSE:NVS)’ stake in Idenix has decreased considerably, although the large pharmaceutical is still a major shareholder.
GenMark Diagnostics, Inc (NASDAQ:GNMK) seems to be playing a not-so-fun game of domino-stacking. Those dominoes delivered an 18% fall in the company’s share price this week.
The company made our horrendous-stocks list last week because its biggest customer, Natural Molecular Testing Corporation, or NMTC, struck a deal to use technology from one of GenMark Diagnostics, Inc (NASDAQ:GNMK)’s chief rivals. This week, GenMark Diagnostics, Inc (NASDAQ:GNMK) announced the next domino to fall as a result of that deal. The company lowered its full-year revenue guidance by 14%, citing uncertainties relating to NMTC’s decision and reimbursement challenges.
On the positive side, GenMark Diagnostics, Inc (NASDAQ:GNMK) still sees 2013 revenue growing to 50% higher than last year’s revenue. CEO Hany Massarany noted also that the company is making good progress in the development of its new NexGen molecular diagnostic testing system. Massarany said that GenMark Diagnostics, Inc (NASDAQ:GNMK) believes that the sample-to-answer system will “fuel significant growth” for the company in the future.
An analyst downgrade served as a downer for TESARO Inc (NASDAQ:TSRO) stock this week. Shares dropped 17% after BMO Capital Markets changed its rating on TESARO Inc (NASDAQ:TSRO) from “outpeform” to “market perform.”