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Market Keeps Its Nerve
STACY LAWRENCE
In the jittery market of the last few months, the life sciences sector lost a few percentage points. Though life sciences stocks are still up slightly for the year, this summer’s market optimism went largely to the tech-heavy Nasdaq. Both the Dow and the S&P also outperformed life sciences companies.
Within life sciences, the biopharmaceuticals sector suffered but held on to the gains it made in the last year, while nutraceutical companies continued to see their values dwindle. Health care services and agbio companies, stragglers throughout the spring, got a bump up this summer.
Three of the top ten gainers were health care services companies: HealthSouth, Beverly Enterprises, and Kindred Healthcare. Scandal-tainted HealthSouth continued to be haunted by debt and accounting problems. But even after being delisted from the NYSE in April and dumped by institutional investors in the second quarter, the stock managed to crawl up from just a few cents to around $3 in the last few months. Bankruptcy rumors were being held at bay as the company tried to make good on its debt and to offer up chastened executives. At press time, 14 HealthSouth officials had pled guilty to accounting fraud.
Another company, buoyed after floundering in the wake of infamy, also ended up a top performer in the last three months: ImClone Systems. After heartening European trials, market enthusiasm was revived for Erbitux, ImClone’s colon cancer treatment. This momentum was only heightened by a resubmitted application for FDA approval, and Harlan Waksal’s resignation as CEO. Analysts are now predicting that Erbitux will be on the market next year.
Genzyme’s acquisition of the pharmaceutical immunology specialist SangStat Medical sparked a significant boost in the latter’s share price. But Genzyme’s competitor BioMarin Pharmaceuticals saw its stock sag after a strong run-up for the year. Another immune system drugmaker, InterMune, also suffered major stock price declines; the damage from its lowered sales figures was exacerbated by a public relations fumble over revised revenue targets.
Institutional Holdings
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CHANGE IN NUMBER OF SHARES HELD (MILLIONS) |
Q2 SHARES HELD (MILLIONS) |
Q1 SHARES HELD (MILLIONS) |
PERCENT CHANGE IN SHARES HELD |
Q2 SHARES AS A PERCENT OF OUTSTANDING SHARES |
NUMBER OF SHAREHOLDING INSTITUTIONS |
| MOST BOUGHT |
| Amgen (Nasdaq: AMGN) |
37 |
920 |
883 |
4% |
68% |
1,721 |
| Genzyme (Nasdaq: GENZ) |
25 |
203 |
178 |
14% |
88% |
628 |
| Abbott Laboratories (NYSE: ABT) |
24 |
953 |
929 |
3% |
60% |
1,501 |
| Johnson & Johnson (NYSE: JNJ) |
23 |
1,894 |
1,871 |
1% |
62% |
2,173 |
| Bristol-Myers Squibb (NYSE: BMY) |
23 |
1,235 |
1,212 |
2% |
62% |
1,772 |
| MOST SOLD |
| Pfizer (NYSE: PFE) |
-292 |
5,078 |
5,371 |
-5% |
63% |
2,516 |
| HealthSouth (OTC: HLSH.PK) |
-121 |
58 |
179 |
-67% |
12% |
299 |
| AmerisourceBergen (NYSE: ABC) |
-25 |
99 |
124 |
-20% |
86% |
597 |
| Savient Pharmaceuticals (Nasdaq: SVNT) |
-13 |
17 |
30 |
-42% |
28% |
122 |
| HCA (NYSE: HCA) |
-12 |
391 |
403 |
-3% |
80% |
793 |
Based on data reported by U.S. institutions to the Securities & Exchange Commission.
 (Subject to Terms and Conditions)
Data as of August 25. P/E ratios are trailing 12 months. All of the sector indices are weighted by market capitalization. The life sciences index is based on the 954 life sciences companies publicly traded in the United States. All sectors other than agbio/agrichemical are subsectors of the overall life sciences index. Specific company data is limited to those that are focused on life sciences or the defined subsector and to companies with a market cap of at least $500 million. SOURCE: Reuters, Revere Data
Additional charts accompanying text include:
Top Gainers
Top Decliners
Best- and Worst-Performing Sectors
Life Sciences Market Performance
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» BioIndex: Market Keeps Its Nerve
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