NEW YORK (CNNfn) - After helping catapult the Nasdaq composite index to new highs, biotechnology shares took a beating Tuesday amid concerns that the government wants scientists to have free access to corporate research on the charting of human genes.|
Shares of genomics companies, which seek to profit from research on the mapping of the human genetic code, led the biotech sector and the Nasdaq index downward after U.S. President Bill Clinton and British Prime Minister Tony Blair essentially proposed that this genetic data should be free. Private companies are competing with the publicly funded Human Genome Project in trying to chart the sequence of human genes -- data that scientists hope to use to learn more about why disease strikes and to develop more effective drugs.
The Nasdaq biotech index fell more than 12 percent, contributing to the Nasdaq's overall slide of 4 percent, or 200 points. The technology-heavy Nasdaq composite has now slid more than 338 points over two days, weighed down in part by profit-taking in highflying biotech stocks. So far this year, the Nasdaq biotech index has soared about 37 percent.
Shares of genetic database company Celera Genomics (CRA: Research, Estimates), which is one of a number of private companies that plan to patent or otherwise license their information on human genes for profit, fell 25 percent Tuesday to 142 on the New York Stock Exchange. Celera stock has traded as high as 276 this year. Still, even with Tuesday's drop the stock is up sharply from its 52-week low of 7-3/32.
The day's other losers included Millennium Pharmaceuticals (MLNM: Research, Estimates), which lost 59-1/2 to 176; Human Genome Sciences Inc. (HGSI: Research, Estimates), down 29-1/16 to 123-1/2; Affymetrix (AFFX: Research, Estimates), which slid 34-3/16 to 203-1/16 and Abgenix (ABGX: Research, Estimates), which gave back 30-21/32 to 287-27/32. All of these stocks are still trading many times above their 52-week lows.
In their joint statement, Clinton and Blair called research into the human genetic blueprint "one of the most significant scientific projects of all time" and proposed that to fully realize its potential the data should be freely available. Biotech analyst Richard van den Broek, of Chase H&Q, called the leaders' statements political positioning ahead of some sort of public and private sector agreement on research into the human genome.
Biotech analyst Sushant Kumar, of Mehta Partners, said that the market jitters over the genomics sector came on top of a recent bout of profit taking and concerns that some of the valuations in the sector "are not sustainable."
-- staff and wire reports