Biotech's manic Monday

The BioCentury 100 plunged 8.5 percent on Monday, a drop more than 4 times the 2.1 percent decline on NASDAQ. The tech-laden NASDAQ was off 5.5 percent earlier in the day, sparked by an earnings warning by computer giant Hewlett- Packard (HP), but posted a late-session rally. Only three biotech companies in the index posted gains on the day: infectious disease play BioCryst (BCRX), glucose monitoring company Cygnus (CYGN) and biomaterials company Biomatrix (BXM). The AMEX Pharma Index was down 3.2 percent, and the DJIA finished the day down 0.8 percent.

An article that appeared in Barrons over the weekend declaring that biotech profits remain "dangerously exposed" didn't help matters. The article - which carried the inquisitive subtitle 'Could the biotechs become the market's next dot.coms?' -- recommended that investors take biotech profits while they still exist; pointing out that the sector has been one of the few technology areas spared by the current market doldrums. The article specifically mentioned Protein Design (PDLI ), Vertex (VRTX) and Idec (IDPH) as the three companies in the 17-company AMEX Biotech Index that have each traded up more than 50 percent in the last three months. Each of the three lost at least 15 percent of their respective values on the day. In fact, PDLI, an antibody play, led the percentage decliners of the entire BioCentury 100 on the day, shedding $29.50 (24 percent) to $95.50 on 3.4 million shares. VRTX, which develops small molecule drugs to treat viral diseases, inflammation, cancer, autoimmune diseases and neurological disorders, tumbled $17.625 (20 percent) to $71.188 on 2.3 million shares, and IDPH, a cancer antibody company, fell $30.188 (15 percent) to $169.50 on 3.3 million shares. ...