US STOCKS ended down yesterday, led by losses in biotech shares after disappointing news from several companies.
The Nasdaq Biotech Index sank 4.1 per cent, its biggest daily percentage loss since 25 March, while the S&P Healthcare index, down 1.8 per cent, was the biggest drag on the benchmark S&P 500 index.
Amgen shares led the S&P 500’s decline, dropping 3.3 per cent to $162.38 after US regulators said its skin cancer immunotherapy cannot be considered for an accelerated review.
Celladon shares fell 80.7 per cent to $2.64 and hit a record low of $2.59. It said it expected layoffs and cost cuts after the company's lead experimental gene therapy to treat heart failure failed a key trial.
Healthcare companies have been the top performers so far in 2015, helping push major stock indexes to records. Biotechs in particular have driven up the Nasdaq, which last week reached its first all-time closing high in 15 years.
But the sector is being dragged down by reports of high pricing by speciality pharmaceutical companies as well as the disappointing news from Celladon and Amgen, said Paul Yook, portfolio manager of biotech exchange traded funds and at LifeSci Partners in New York.
“Drug pricing has been a real concern for investors,” he said.
The Nasdaq biotech sector briefly fell into bear market territory a year ago following a selloff in Gilead shares and concerns about valuations. But analysts said for now they don’t view yesterday’s selloff as the start of a bigger drop.