BOSTON ( TheStreet) -- KV Pharmaceuticals (KV) was the best-performing drug/biotech stock in the third quarter. The troubled drugmaker's stock price rose 185%, sparked by U.S. regulatory approval to re-launch products that had been pulled from the market earlier due to manufacturing problems.
Bookending KV Pharma's resurgence was the poor performance of Icagen (ICGND), which lost 59% of its value in the third quarter after an experimental epilepsy drug encountered safety problems during a clinical trial.
Overall, the Nasdaq Biotechnology Index rose 12% in the third quarter, matching the performance of the Nasdaq and beating slightly the 11% gain made by the S&P 500. Like the market overall, August and September were especially good months for biotech and drug stocks.
Acquisitions helped two other drug stocks run to the top the quarter's best-performance list. Zymogenetics (ZGEN) closed the quarter up 141% due to Bristol-Myer Squibb's (BMY) $885 million, or $9.75-a-share, takeover offer in September.Likewise, Osteotech (OSTE) shares were up 126% on a $6.50-a-share buyout from Medtronic (MDT) in August. Rounding out the top 10 best-performing biotech/drug stocks in the third quarter, according to CapitalIQ: Nile Therapeutics (NLTX) (+110%), Ista Pharmaceuticals (ISTA) (+94%), Medicines Co. (MDCO - Get Report)(+94%), Savient Pharmaceuticals (SVNT - Get Report) (+83%), Amicus Therapeutics (FOLD) (+78%), Oncolytics Biotech (ONCY) (+77%) and Cypress BioSciences (CYPB) (+76%). Arena Pharmaceuticals (ARNA - Get Report) was the second-most damaging stock for drug and biotech investors in the just-closed quarter, losing 56% after a U.S. advisory panel voted down the company's weight-loss drug lorcaserin. Vermillion (VRML - Get Report) shares fell 56% in the quarter on the poor launch of its ovarian cancer test. Rounding out the quarter's worst biotech and drug stocks, according to CapitalIQ: Molecular Insight Pharmaceuticals (MIPI) (-50%), Xoma (XOMA)(-50%), AMAG Pharmaceuticals (AMAG) (-49%), AspenBio Pharma (APPY) (-47%), Idenix Pharmaceuticals (IDIX) (-36%), Epicept (EPCT) (-36%) and DARA BioSciences (DARA) (-34%). --Written by Adam Feuerstein in Boston.
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