Health stocks predominated in small-cap trading Monday, with acquisition news sending several names higher.

1-800 Contacts

(CTAC) - Get Report

leapt 19.7% to $24.02 after private-equity firm Fenway Partners

agreed to acquire

the Utah-based contact lens distributor for $24.25 a share, or about $340 million. The deal is expected to close in the second half of fiscal 2007.

Diagnostic substances maker

Digene

( DIGE) surged more than 30% to $58.27 after

Qiagen

(QGEN) - Get Report

agreed to buy

the Maryland-based company for some $1.6 billion in cash and stock. The transaction should close in August or September. Dutch-based Qiagen dropped 6.9% to $16.09.

And

Inverness Medical Innovations

( IMA) will take out

Cholestech

( CTEC) in a stock-swap merger worth around $21.02 a share, or $326 million (on the basis of Inverness' latest closing price). Cholestech soared 17.6% to $19.72; Inervess lately lost 3.7%.

Elsewhere,

KMG Chemicals

( KMGB), of Houston, reported 70% higher earnings year over year -- 34 cents a share, or $3.8 million -- in the quarter ended April 30. Two analysts polled by Thomson Financial were seeking 21 cents a share. KMG also said David Hatcher has resigned as chief executive, to be replaced by Chief Operating Officer Neal Butler, though Hatcher will remain chairman of the board. KMG shares catapulted 26.2% to $19.19.

Among small-cap laggards, however,

GenVec

(GNVC)

plummeted 31.3% after a phase II/III study of its TNFerade product showed no statistically significant tumor-response difference from standard care alone in pancreatic-cancer patients. The drug also induced 74% longer survival rates vs. standard care alone, but shares of the Gaithersburg, Md., biopharma slid $1.41 to $3.10.

California's

Telik

(TELK)

, another biopharma, announced the failure of two late-phase Telcyta studies -- one for treatment of ovarian cancer, and the other for that of lung cancer (the latter on a top-line basis). Each study failed to meet both the primary and secondary endpoints. Shares of Telik plunged 19.3% to $4.69.

Elsewhere in the health care sector, small-cap biotech

American Oriental Bioengineering

( AOB), based in China, tumbled 9.7% to $9.92 after filing for a 15-million-share follow-on public offering, with 13 million shares to be sold by the company itself and the rest by Chief Executive Tony Liu. Underwriters also have a 2.25-million-share option in order to cover any overallotments.

Finally, tech name

UTStarcom

(UTSI) - Get Report

, of Alameda, Calif., fell 11.4% to $6.48 on news late Friday that Ying Wu, CEO of its Chinese unit,

has departed

.

As for broad trackers, both the Russell 2000 and the S&P SmallCap 600 dipped into the red, with each recently slipping 0.1%.