Mid-caps performed best last quarter, with four companies gaining more than 50%. Other segments largely held on to their 1Q gains, except for companies valued below $200 million, which fell 15% in the quarter and finished under water for the half (see "Results by Market Cap," A30).

Arena Pharmaceuticals Inc., which had barely broken into the $500-$999 million segment at the beginning of last quarter, was the biggest winner going away. The biotech ran up 224% to a $2 billion valuation on a favorable FDA advisory committee vote in May and last week's approval of obesity drug Belviq lorcaserin. Arena and partner Eisai Co. Ltd. will announce a launch timeline after the U.S. Drug Enforcement Administration completes its review of the drug, which Arena estimates will take four to six months. The DEA has classified Belviq as a class IV scheduled drug.

The steepest drop in the $500-$999 million market cap group came from HCV play Achillion Pharmaceuticals Inc. Its 35% decline started on April 4, when the European Association for the Study of the Liver published abstracts. It continued through the April 21 presentation of Phase IIa data for HCV NS3 protease inhibitor ACH-1625, and the company's explanation a few days later that the lackluster data had been adversely affected by patients who dropped out for reasons unrelated to the trial. In June, Elizabeth Olek resigned as CMO and SVP of clinical development.

Three of the quarter's biggest gainers came from the $1-$4.9 billion group, which rose 5.4% on the quarter and was up 15.1% at the half.

The top performer in this group was Pharmacyclics Inc., with a 97% gain driven by data for ibrutinib. In early June at the American Society of Clinical Oncology (ASCO) meeting and in mid-June at the European Hematology Association, the company presented Phase Ib/II data for the Bruton's tyrosine kinase (Btk) inhibitor to treat chronic lymphocytic leukemia (CLL) and small lymphocytic lymphoma (SLL). Pharmacyclics and partner Johnson & Johnson have said they will proceed with Phase III testing.

Onyx Pharmaceuticals Inc. was a close second, up 76%. Almost all the gains came after FDA's Oncologic Drugs Advisory Committee voted in favor of Kyprolis carfilzomib to treat relapsed and refractory multiple myeloma (MM). The selective proteasome inhibitor has a July 27 PDUFA date.

Next was Human Genome Sciences Inc., which added 59% on a hostile takeover bid from GlaxoSmithKline plc.

Amylin Pharmaceuticals Inc. gained 13% on renewed takeout rumors that were finally consummated after market close last Friday when Bristol-Myers Squibb Co. announced an agreement to acquire the diabetes company in a two-step deal involving AstraZeneca plc.

The biggest losers in this group include Halozyme Therapeutics Inc., which shed 31%. Most of that haircut came after the biotech and Baxter International Inc. said FDA needed additional information before it can complete a review of HyQvia, a subcutaneous immune globulin plus rHuPH20 enzyme for primary immunodeficiency disorder. According to the partners, FDA did not issue a complete response letter.

Dendreon Corp. also lost 31% on a series of disappointments. First, the company's 1Q earnings announcement did not raise its 2012 sales guidance of "modest" quarter-over-quarter growth for Provenge sipuleucel-T in castration-resistant prostate cancer (CRPC).

The biotech then became the subject of an SEC investigation, the focus of which has not been disclosed.

The shares continued dropping on enthusiasm for prostate cancer competitors Zytiga abiraterone acetate from J&J and enzalutamide from Medivation Inc. Both had data at ASCO.

Medivation tacked on a tidy 22% last quarter.

Slipping and sliding

The over $5 billion segment was pulled down by Celgene Corp. and Illumina Inc.

Celgene shed almost $6 billion (20%) in market cap on a 1Q earning miss and withdrawal of a European application to extend the label of MM drug Revlimid lenalidomide to newly diagnosed patients.

Illumina lost 23% on the quarter after Roche abandoned its hostile takeover bid. The company had been trading above Roche's final offer of $6.3 billion, but closed the quarter at $5 billion.

Despite an 8% drop in the last week of the quarter, Vertex Pharmaceuticals Inc. was the biggest winner in the group. Last week, the biotech's shares declined after reporting final Phase II data for VX-809 / Kalydeco ivacaftor in cystic fibrosis (CF) (see B22).

Vertex still finished up 36% on the quarter, but it had added almost 60% at its 2Q peak between the two May reports.

Micro-waves

Among the small caps, partners Aeterna Zentaris Inc. and Keryx Biopharmaceuticals Inc. fell the most on an April Phase III trial miss for perifosine to treat refractory metastatic colorectal cancer (mCRC). They dropped 76% and 63%, respectively, on the quarter and mutually terminated a deal related to the compound in May.

Stem cell play Osiris Therapeutics Inc. rose 115% to a $360 million market cap after receiving conditional approval in Canada and provisional approval in New Zealand for Prochymal remestemcel-L to treat acute graft-host disease (GvHD) in children. The company said these are the first regulatory approvals for a manufactured stem cell product.

COMPANIES AND INSTITUTIONS MENTIONED

Achillion Pharmaceuticals Inc. (NASDAQ:ACHN), New Haven, Conn.

Aeterna Zentaris Inc. (TSX:AEZ; NASDAQ:AEZS), Quebec City, Quebec

American Society of Clinical Oncology (ASCO), Arlington, Va.

Amylin Pharmaceuticals Inc. (NASDAQ:AMLN), San Diego, Calif.

Arena Pharmaceuticals Inc. (NASDAQ:ARNA), San Diego, Calif.

AstraZeneca plc (LSE:AZN; NYSE:AZN), London, U.K.

Baxter International Inc. (NYSE:BAX), Deerfield, Ill.

Bristol-Myers Squibb Co. (NYSE:BMY), New York, N.Y.

Celgene Corp. (NASDAQ:CELG), Summit, N.J.

Dendreon Corp. (NASDAQ:DNDN), Seattle, Wash.

Eisai Co. Ltd. (Tokyo:4523; Osaka:4523), Tokyo, Japan

European Association for the Study of the Liver (EASL), Geneva, Switzerland

European Hematology Association (EHA), The Hague, the Netherlands

GlaxoSmithKline plc (LSE:GSK; NYSE:GSK), London, U.K.

Halozyme Therapeutics Inc. (NASDAQ:HALO), San Diego, Calif.

Human Genome Sciences Inc. (NASDAQ:HGSI), Rockville, Md.

Illumina Inc. (NASDAQ:ILMN), San Diego, Calif.

Johnson & Johnson (NYSE:JNJ), New Brunswick, N.J.

Keryx Biopharmaceuticals Inc. (NASDAQ:KERX), New York, N.Y.

Medivation Inc. (NASDAQ:MDVN), San Francisco, Calif.

Onyx Pharmaceuticals Inc. (NASDAQ:ONXX), South San Francisco, Calif.

Osiris Therapeutics Inc. (NASDAQ:OSIR), Columbia, Md.

Pharmacyclics Inc. (NASDAQ:PCYC), Sunnyvale, Calif.

Roche (SIX:ROG; OTCQX:RHHBY), Basel, Switzerland

Vertex Pharmaceuticals Inc. (NASDAQ:VRTX), Cambridge, Mass.