Major market indexes set record highs again this week, but not everyone joined in the celebration. Here are three party-poopers for the week from the world of health care.
Hard to say goodbye
Synta Pharmaceuticals (NASDAQ: SNTA ) found out how hard it can be to say goodbye. The company's head of research and development left abruptly this week. Shares of the biotech sank 18% on the news.
The other negative for Synta came from the analyst community. BMO Capital downgraded the stock from outperform to market perform. However, this action stemmed from the departure of Synta's R&D president, Sumant Ramachandra.
Ramachandra left suddenly after less than two months heading up Synta's R&D group. The company stated that he resigned "for personal reasons." A BMO analyst suggested that the surprise departure hinted at a "less than amicable separation," although no further details were provided by Synta.
A penny costs a lot these days
Isis Pharmaceuticals (NASDAQ: ISIS ) reported its first quarter results on Tuesday, missing analysts' earnings estimate by $0.01 per share. Isis shares fell 15% for the week. Is a penny worth that much these days? Not really.
The biotech's quarter actually was pretty good. Its net loss of $1.7 million, or $0.02 per share, reflected tremendous year-over-year improvement. During the first quarter of 2012, Isis reported a net loss of $24.0 million, or $0.24 per share.
Isis also saw strong revenue growth, reporting $43.4 million, compared to $23.2 million in the same period last year. The company benefited primarily from a milestone payment from Sanofi's Genzyme unit. Genzyme paid Isis $25 million for FDA approval of homozygous familial hypercholesterolemia drug Kynamro.
The more likely reason for the stock dropping stemmed from Isis announcing a secondary offering of 9 million shares. This amounts to around 9% of the company's outstanding shares.
Prostate cancer drug Provenge once looked to be a star for Dendreon (NASDAQ: DNDN ) . Now it seems to be more of a falling star -- along with Dendreon's stock. Shares dropped 15% this week following poor first-quarter results.
Even though Dendreon has been trying mightily to jump-start Provenge, sales fell 18% year over year, to $67.6 million during the first quarter. Dendreon CEO John Johnson says that increased competition is largely to blame.
Dendreon faces one challenge from Johnson & Johnson (NYSE: JNJ ) . J&J's Zytiga received approval in December for treating patients who haven't received chemotherapy. That puts Zytiga in a head-to-head match-up against Provenge.
Medivation (NASDAQ: MDVN ) also presents a threat to Provenge. The biotech obtained approval for Xtandi last August. The prostate cancer drug is approved for patients who weren't helped by chemotherapy.
Bad weeks happen, but sometimes, they're only temporary. I suspect that's true especially for Isis. Of the three horrendous performers from this week, Isis looks to be in the best shape overall.
I think that the double-digit drop stemming from the secondary offering and slight earnings miss could present a good buying opportunity. Isis might have been a party pooper for investors this week, but my take is that shareholders will be celebrating again before too long.
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