Health stocks spent most of the day lower with the broader market Tuesday.
The Amex pharmaceutical index fell 1% to 300.44; the Amex biotechnology index tracked 0.7% lower to 752.09; and the Nasdaq biotechnology index sank 0.9% to 802.39.
Merck (MRK - Get Report) got the downward action started early Tuesday on news the Food and Drug Administration rejected MK-0524A, the drugmaker's proposed new cholesterol treatment. Merck shares sank 10.6% to $37.04 on heavy volume.
More declines came from biotech companies Genentech (DNA) and Biogen Idec (BIIB - Get Report), which disclosed negative study data for Rituxan. In a late-stage-study, patients with systemic lupus erythematosus (SLE), commonly called lupus, failed to respond any better to Rituxan vs. placebo after one year of treatment. None of the study's six secondary endpoints was successful, either. Genentech shares fell about 7% to $68.06, while Biogen lost about 5% to $61.45 on heavier-than-usual volume.Idenix Pharmaceuticals (IDIX) also lost ground Tuesday, falling some 9% to $6.58. The biotech company posted a wider first-quarter loss of $20.5 million, or 36 cents a share, vs. a loss of $11.6 million, or 21 cents a share, in the prior-year quarter. Revenue came in at $2 million, a sharp decline from the $24.8 million the company generated a year ago. In addition, Susquehanna Financial downgraded Idenix shares from positive to neutral. The stock sank about 10% to $6.53. Also suffering from a downgrade Tuesday was Tenet Healthcare (THC - Get Report), which Deutsche revised from buy to hold with a $7.25 price target. Shares of the hospital operator fell 2.2% to $6.55.