Wednesday proved another shoddy day for the biotech sector, but stocks managed to make up for some of the intraday fall by midafternoon. Human Genome Sciences ( HGSI) fell Wednesday after the company announced it will lower the higher, less-frequent dose of its hepatitis C drug Albuferon in late-stage trials because of pulmonary side effects. Shares gave up $4.40, or 44%, to $5.62 after an independent data monitoring committee flagged the 1200 mgc once-monthly dose in the Achieve trials for safety concerns. The affected dose arms will be lowered to 900 mcg twice-monthly. The company said it continues to expect to have all phase III data available by spring 2009 to support the filing of global marketing authorization applications by fall 2009. Meanwhile, fellow hepatitis C drug developer Vertex Pharmaceuticals ( VRTX) said Wednesday that it received the OK from regulators to start phase III studies of its telaprevir. Vertex said Wednesday that it will conduct two phase III trials to satisfy Food and Drug Administration regulatory requirements. The first study, enrolling 1,050 patients with newly diagnosed hepatitis C, will evaluate two different telaprevir regimens, each totaling 24 weeks in length. These patients will be compared against an arm of patients treated with the current standard of care for 48 weeks. Vertex has also said that it plans to raise money, in part, to pay for the new clinical trials. The agreement reached between Vertex and the FDA is a positive for investors concerned that a significant delay in telaprevir might allow competing hepatitis C drugs that were further behind in development to catch up. Despite the news, shares were down $2.35, or 10.5%, to $20.02. Check out Senior Columnist Adam Feuerstein
coverage on Vertex for more. Elsewhere, in earnings: Pfizer ( PFE) reported adjusted fourth-quarter earnings of $3.6 billion, or 52 cents a share, on revenue of $13.1 billion, vs. $3 billion, or 43 cents a share, on revenue of $12.6 billion on the same basis in the year-ago quarter. Analysts surveyed by Thomson Financial were looking for 47 cents a share on revenue of $12.19 billion. For the year, the company reported earning $8.3 billion, or $1.20 a share, vs. $19.3 billion, or $1.20 a share, in 2006. Results from the prior year benefited from an after-tax gain of $7.9 billion tied to the sale of its Consumer Healthcare business, while 2007 included after-tax charges of $2.1 billion related to write-offs in light of Pfizer's decision to dump inhaled insulin Exubera. Looking ahead, the company expects adjusted earnings of $2.35 to $2.45 a share ($1.78 to $1.93 on a non-adjusted basis) on revenue of $47 billion to $49 billion in 2008. Analysts surveyed by Thomson Financial were looking for $2.34 a share on revenue of $47.1 billion for the year. Shares traded up 63 cents, or 2.8%, to $22.86. Abbott ( ABT) reported adjusted quarterly earnings of $1.5 billion, or 93 cents a share, on net sales of $7.22 billion, vs. $1.15 billion, or 75 cents a share, on revenue of $6.22 billion in the year-ago quarter. Analysts surveyed by Thomson Financial were looking for 92 cents a share on revenue of $6.96 billion. For the year, the company said that before items it earned $3.6 billion, or $2.84 a share, on revenue of $25.91 billion, vs. $1.7 billion, or $2.53 a share, on revenue of $22.48 billion in 2006 on the same basis. (Those results factor out the acquisitions of Kos Pharmaceuticals and Guidant's coronary stent operations.) Annual results just beat the Thomson Financial consensus target of $2.83 a share on revenue of $25.5 billion. Looking ahead, the company expects adjusted earnings between 61 cents and 63 cents a share (58 cents to 60 cents on a GAAP basis) for the first quarter, and $3.20 to $3.25 a share ($3.12 to $3.17 on a GAAP basis) for 2008. Analysts surveyed by Thomson Financial are looking for 65 cents a share for the quarter, and $3.22 a share for the year. Abbott shares ended up 48 cents, or 0.8%, at $57.97. Abbott and Pfizer are both components of the Amex Pharmaceutical index, which was down 2.58, or 0.8%, at 320.61. And, for its recent quarter, St. Jude Medical ( STJ), earned $118.3 million, or 34 cents a share, compared with profit of $154.6 million, or 42 cents a share, in the year-ago quarter. Excluding charges of $71 million for inventory write-offs, discontinued products and asset impairment costs, the company reported earning 54 cents a share for the period, on revenue of $1.02 billion, which was up from $863.8 million a year earlier. Analysts polled by Thomson Financial had expected profit of 49 cents a share on revenue of $979.7 million. St. Jude benefited an estimated $20 million from a Medtronic ( MDT) recall on leads for implantable defibrillators. Overall defibrillator sales climbed 19% to $637 million. For the full year, St. Jude earned $559 million, or $1.59 a share, on revenue of $3.78 billion vs. $548.3 million, or $1.47 a share on revenue of $3.3 billion in 2006. On an adjusted basis, the company earned $1.85 a share, compared to $1.53 a share in the prior year. St. Jude shares were trading up $1.38, or 3.4%, at $41.66.