Friday's Health Winners & Losers

Health stocks fell prey Friday to the same investor sentiment dragging down the broader market.

One stock faring well was PDL BioPharma (PDLI Quote), which said Friday that it would separate its biotechnology operations from its antibody royalty stream and distribute $502 million to stockholders based on current shares outstanding.

The company expects to capitalize the new company with about $375 million, after the spinoff. PDL said it believes the separation will enhance its ability to sell or securitize all or part of its antibody royalties, should it decide to do so. Its royalty revenue is supported by license agreements for such drugs as Genentech's (DNA Quote) Avastin and Herceptin as well as Biogen Idec (BIIB Quote) and Elan's (ELN Quote) Tysabri, among others.

The dividend, on May 6, is derived from proceeds from the sale of PDL's commercial and cardiovascular products as well as its biologics manufacturing facility. PDL's shares rose $1.98, or 16.9%, to $13.69.

Meanwhile, Genentech aired its first-quarter earnings last night with a per-share beat but a miss on sales of its cancer drug Avastin, which totaled $600 million, vs. Wall Street estimates ranging from $614 million to $621 million.

Overall, the company earned $895 million, or 84 cents a share, on an adjusted basis in the quarter, in comparison to $792 million, or 74 cents a share, on the same basis, the year prior. The company reported revenue of $3.06 billion, an 8% increase from the $2.8 billion it generated a year earlier. Wall Street was looking for earnings of 82 cents a share on $3.1 billion in revenue.

Genentech shares traded down $1.21, or 1.6%, to $76.79.

The Nasdaq biotechnology index, and the Amex Biotechnology and Pharmaceutical indices all changed direction to close the week out in the red. The Nasdaq index, in particular, gave up 15.58, or 2%, to 796.75. A couple of stocks tugging at the index despite little news: ZymoGenetics (ZGEN Quote), Amgen (AMGN Quote) and Celgene (CELG Quote). ZymoGenetics fell 8.1%,to $9.03. Amgen shares retracted 2.2% to $43.01. Celgene shares fell 1.9% to $62.66 on lower-than-average volume.

Faring no better, medical device companies St. Jude (STJ Quote), Stryker (SYK Quote) and Boston Scientific (BSX Quote) were trading down, 1.9%, 2.3% and 2.9%, respectively.

Among exchange-traded funds, HealthShares Emerging Cancer (HHJ Quote) fell 2.3% to $15.46. Its down 17.56% year to date, and includes stocks like Dendreon (DNDN Quote) and GPC Biotech (GPCB Quote).

Last, look for biotech Gilead Sciences (GILD Quote) in earnings next week (on Wednesday, April 16). Analysts surveyed by Thomson Financial are looking for 48 cents a share on revenue of $1.2 billion.

A few helpful numbers: The Street is looking for $919 million total in HIV sales, as well as $79 million from Hepsera, $67 million in sales of antifungal AmBisome and $25 million from the hypertension drug Letairis. Breaking down HIV drug sales, the consensus targets are $147 million for Viread, $455 million for Truvada and $309 million for Atripla.