When lightning strikes

Ebb & Flow

One reason investors worry about the biotech sector is the magnitude of loss that can occur instantly on product setbacks. A reminder is Connetics' 47 percent slide on Wednesday after its gamma interferon showed no efficacy in a Phase III trial in atopic dermatitis (see BioCentury Extra, Aug. 28). CNCT was down $3.563 - 41 percent - on the week to $5.062. By comparison, 32 major biotech sell-offs that followed disappointing clinical events over the past three years clipped each stock an average of 44 percent(see chart, next page).Generally positive reports aren't immune - witness Amylin's 43 percent drop on Aug. 18 after data from two Phase III trials of AMLN's pramlintide in diabetes were tempered by unanticipated strength in the placebo group...