Let's take a quick look at four stocks -- Celgene (NASDAQ:CELG), AbbVie (NYSE:ABBV), Shire (NASDAQ: SHPG), and Sanofi (NASDAQ:SNY) -- which could all loom large in biotech headlines this Wednesday morning.

Celgene's Otezla fails a late-stage trial
Celgene has just announced that Otezla, its oral treatment for active ankylosing spondylitis (an inflammatory disease of the axial skeleton) did not achieve its primary endpoint in a phase 3 trial when compared to a placebo for 16 weeks.

However, in a pre-specified analysis, researchers did find efficacy at the 24th week in a group of patients with early stage disease.

While the setback was disappointing, investors should remember that ankylosing spondylitis is only one of seven indications for which Otezla is being tested -- which also include psoriasis, rheumatoid arthritis, ulcerative colitis, and dermatitis. The FDA approved Otezla for psoriatic arthritis in March. Celgene believes Otezla has peak sales potential of $2 billion if approved for psoriasis and other indications, but the average consensus estimate at EvaluatePharma is closer to $1.2 billion.

Nonetheless, Otezla represents a promising way for Celgene to diversify its portfolio away from its blockbuster multiple myeloma drug Revlimid, which generated sales of $4.28 billion (66% of Celgene's top line) last year. Shares of Celgene were down nearly 6% in pre-market trading this morning after the announcement.

AbbVie retracts comments regarding its potential acquisition of Shire
Meanwhile, AbbVie CEO Richard Gonzalez has retracted comments about his proposed takeover bid for Shire since they constituted a violation of British takeover rules.

Gonzalez's declaration that Shire investors were "generally supportive of the transaction" violated a U.K. Takeover Panel rule stating that a company cannot make such a claim unless it is backed in writing by shareholders.

Yesterday, AbbVie raised its offer for Shire again to £30.1 billion ($51.3 billion) -- representing an 11% increase from its previous bid and a 48% premium to Shire's share price prior to its first offer in May. The cash and stock offer, if accepted, would leave Shire shareholders owning approximately 24% of the combined company -- which equals £22.44 ($38.40) in cash and 0.86 of an AbbVie share for each share of Shire.

AbbVie is keen on taking over Shire for two main reasons -- it would pay much lower corporate taxes by moving its tax domicile from Illinois to Ireland, and the addition of Shire's ADHD and rare disease drugs would decrease its dependence on the blockbuster arthritis drug Humira. Humira generated $10.7 billion in sales (57% of AbbVie's revenue) last year, but its patents will expire in Europe in 2016, and in the U.S. in 2018.

FDA will review Sanofi's NDA for Toujeo
Last but not least, Sanofi's new drug application (NDA) for its basal insulin candidate, Toujeo, has been accepted for review by the FDA. Toujeo is a new formulation of Lantus (insulin glargine), which generated sales of $7.6 billion in 2013.

According to data from a pooled analysis of Toujeo, patients experienced significantly fewer low blood sugar events at any time of the day when compared to Lantus. The phase 3 EDITION studies, on which the NDA's submission was based, tested Toujeo on over 3,500 diabetic patients. Toujeo is already under regulatory review in Europe.

Toujeo is one of two Lantus-based diabetes treatments that Sanofi has in its pipeline. LixiLan, which combines Lantus with Lyxumia, a GLP-1 drug, is currently in phase 3 trials. The approval of Toujeo and LixiLan could help offset lower sales of Lantus, which could lose sales to an upcoming generic version from Eli Lilly and Boehringer Ingelheim in the EU. However, investors shouldn't count on Toujeo to completely replace Lantus -- peak sales estimates are only around $1 billion.