Shares of adult stem cell company Osiris Therapeutics ( OSIR) took a hit on a downgrade from a Jefferies & Co. analyst Wednesday.

"While we continue to believe OSIR provides long-term potential for its adult stem cell technology, we step to the sidelines for a better entry point," said biotech analyst Eun Yang, who downgraded the stock to hold from buy. Shares sank 8% to $23.29.

Shares of Ciphergen Biosystems ( CIPH) jumped 11.2% to 99 cents Wednesday after it announced an agreement with Quest Diagnostics ( DGX) to co-develop a test for peripheral artery disease.

Under the deal, Quest will assist Ciphergen in the development of the blood-based test. The companies previously agreed to jointly develop a test to detect ovarian tumors.

Biotechnology company Exelixis ( EXEL) said it will get $40 million in upfront and milestone payments in a cancer drug development deal with Genentech ( DNA).

Under the deal, Exelixis will develop the drug, dubbed XL518, after which Genentech has the option to further develop the drug for additional payments and development costs. Exelixis shares gained 4.6% to $9.41, and Genentech's shares were up 0.9% to $81.86.

Shares of Cytokinetics ( CYTK) soared after its partner Amgen ( AMGN) set plans to work on a new heart failure treatment.

Amgen will pay Cytokinetics an upfront payment of $42 million for licensing and access to its technology. It will purchase 3.5 million Cytokinetics shares at $9.47 a share. Cytokinetics shares gained 13% to $8.45, and Amgen's shares were up 0.6% to $68.73.

Among other health stock winners Wednesday were Merck ( MRK), up 2.1% to $44.51; Pfizer ( PFE), 1.7% higher to $26.35; GlaxoSmithKline ( GSK), gaining 2.3% to $53.99; Par Pharmaceutical ( PRX), up 3.3% to $23.10; Pharmion ( PHRM), rising 4.4% to $26.86; and Omrix Biopharmaceuticals ( OMRI), up 5% to $31.76.

Among the losers were Novavax ( NVAX), falling 5.1% to $3.89; Dynavax Technologies ( DVAX), down 4.5% to $8.77; Somaxon Pharmaceuticals ( SOMX), 3.7% lower to $13.67; Cubist Pharmaceuticals ( CBST), off 4.2% to $17.35; and Catalyst Pharmaceutical ( CPRX), sinking 9.9% to $4.35.

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