One government contract moved two starry-eyed companies on an otherwise vanilla Friday for biotech stocks ahead of the JP Morgan Healthcare Conference next week.
To start with a less fortunate stock, shares of Cleveland BioLabs ( CBLA) tanked $4.80, or 60%, to 3.20 after the company said Friday that it wasn't selected for a U.S. Department of Defense (DoD) contract to develop and stockpile a treatment for radiation exposure. The company said it is very surprised by the DoD's decision and has requested a debriefing to better understand the decision. On the other hand, having won the contract, Osiris Therapeutics ( OSIR) added $1.15, or 9.2%, to $13.72. Thursday after the market closed, the company said the U.S. Department of Defense will pay it up to $224.7 million to develop and stockpile Prochymal, an adult stem cell treatment for radiation exposure. The stock is a component of the Nasdaq biotechnology index, but it wasn't enough to push it into the green -- the index was down 7.24, or 0.87%, at 827.66. Also Thursday after close, The Food and Drug Administration cautioned that a study of breast cancer and one of cervical cancer both showed higher mortality rates in patients who'd taken chemotherapy-induced anemia drugs, like Amgen's ( AMGN) Epogen and Aranesp. The FDA said Thursday that it's reviewing information on the ESAs and will take additional actions as appropriate. ESAs are a class of anemia drugs used for chemotherapy-induced anemia and also anemia related to chronic renal disease. In early 2008, a previously announced advisory committee will meet to re-evaluate the risk and benefit balance of the drugs. Amgen was trading down 54 cents, or 1.2%, at 45.15 on Friday.
Stocks soar as the gross domestic product rises at an annualized rate of 3.5% in the third quarter and continuing jobless claims fall. Gregg Greenberg recaps the action in The Real Story video (above).