PTC Therapeutics collapses; SanDisk steady after lowered deal price; Stone Energy drops

By Rebecca Melvin

New York, Feb. 23 – PTC Therapeutics Inc.’s convertibles dropped more than 25 points on Tuesday as the bond’s underlying common shares fell an eye-popping 62% after regulators pulled the rug out from under the South Plainfield, N.J.-based pharmaceutical company’s application to market the Translarna drug.

The U.S. Food and Drug Administration’s refuse-to-file letter said that the application was not up to standards needed to permit a substantive review.

SanDisk Corp.’s two convertible bonds were mostly steady in trade after news that Western Digital is cutting its merger offer to $15.8 billion, or $78.50 a share in cash and stock, after losing its own $3.78 billion infusion from China’s Unisplendour outfit.

Western Digital lost the China investment amid growing expectation that regulatory scrutiny would likely upend China’s participation in the U.S. technology company.

In the energy patch, Stone Energy Corp. reported worse-than-expected quarterly results, and its bonds sank 9 points on a 23% drop in in the underlying shares. But the moves in other energy convertibles were more muted, a New York-based trader said.

Whiting Petroleum Corp.’s convertibles were a bit lower, with a big trade at 35, a Connecticut-based trader said.

Traders were also turning their attention to Chesapeake Energy Corp., which was slated to report fourth-quarter results on Wednesday. The Chesapeake 2.5% convertibles traded at 35 near the end of the session.

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