Morning Commentary: BioMarin bonds, stock drop as FDA criticizes drug; biotech wanes in sympathy

By Stephanie N. Rotondo

Seattle, Nov. 20 – BioMarin Pharmaceutical Inc. took a hit Friday as Food and Drug Administration staff issued a critical report on the company’s drug, drisapersen.

The company’s 0.75% convertible notes due 2018 and the 1.5% convertible notes due 2020 declined 4 to 5 points outright in early Friday trading. The equity underlying the bonds (Nasdaq: BMRN) meantime dropped more than 4.5% by mid-morning.

FDA staff said that thus far, the data provided by BioMarin did not support an approval of the muscle-wasting disorder drug. In particular, the staff was concerned about the impact the drug has on the kidneys, as well as how the drug affected children five years old and younger.

The news did not sit well with some other names in the sector, either.

PTC Therapeutics Inc., for instance, saw its stock continuing to weaken following a 13% decline on Thursday.

The equity was off nearly 7% in early trading.

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