Monday's trading in the stock market was lackluster as most investors appeared to take a break in the week between Christmas and New Year's. Major market benchmarks eased downward, giving up a small amount of ground after last week's strong performance. Yet several individual companies suffered some bad news, and shares of Valeant Pharmaceuticals (NYSE:BHC), Chimerix (NASDAQ:CMRX), and 3D Systems (NYSE:DDD) were among the worst performers in the market today.
Valeant Pharmaceuticals fell more than 10% as company CEO Michael Pearson had to take a medical leave of absence after being hospitalized for severe pneumonia. Valeant didn't predict when Pearson would be back, but the company took the unusual step of appointing three different executives to fill the CEO's role until Pearson returns from medical leave. The leadership role will be split among the company's general counsel, the CFO, and Group Chairman, creating some uncertainty about exactly how Valeant will make decisions in Pearson's absence. Given the difficulties that Valeant has faced recently, including allegations that its business model includes questionable practices in its drug distribution business, the leadership change comes at a particularly unfortunate time for the company, and it'll be important for Valeant to keep moving forward with or without Pearson to defend its ailing reputation as 2016 begins.
Chimerix plunged 81% after the clinical-stage biopharmaceutical company announced disappointing results for a phase 3 trial of its lead candidate drug brincidofovir. The study of the treatment, which aims to prevent cytomegalovirus infection in patients receiving hematopoietic cell transplantation, failed to reach its primary end point through the 24 weeks after receiving the transplants. Although the initial 14-week on-treatment period resulted in fewer CMV infections, the 10 weeks following that period saw an increased in CMV infection. Brincidofovir also failed to produce a decrease in mortality among stem-cell recipients, with the study actually finding a statistically insignificant increase in mortality among users of the candidate drug. Chimerix plans to keep doing studies testing the drug for other indications and will consult with the FDA about how to handle the current trial, but investors fear that the company's best prospect for a near-term blockbuster will at best see substantial delays and could well disappear entirely.
Finally, 3D Systems fell 9%. The maker of 3-D printing systems announced that it would stop producing its $1,000 Cube consumer 3-D printer. Instead, 3D Systems intends to focus more on professional and industrial applications for 3-D printing products, including the CubePro printer for desktop engineering, educational, and professional applications. The company said that it expects to be more profitable as a result of dropping its consumer focus, and it doesn't think that revenue will fall by more than 2%. Nevertheless, with investors having hoped that 3-D printers would become a consumer staple, 3D Systems' announcement shows just how far the aspirations of the industry have gotten reined in as major 3-D printing companies narrow their focus to find their best chances of survival.