2 biotech stocks plummet more than 25% after the FDA rejects their drug applications

• Three biotechnology stocks plummeted on Wednesday after the FDA issued two separate complete response letters, or CRLs, for two separate drugs.
• On Tuesday after the market close, Gilead received a CRL for its drug filgotinib, which was developed in partnership with Galapagos.
• Galapagos plummeted as much as 28% on Wednesday, while Gilead dropped 4%.
• Separately, BioMarin received a CRL from the FDA Wednesday morning for its hemophilia A gene therapy, sending its shares down as much as 32%.
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The FDA issued bad news to three biotechnology firms on Tuesday and Wednesday, sparking an investor exodus that sent shares tumbling.

Gilead received a complete response letter, or CRL, from the FDA on Tuesday after the market close for its rheumatoid arthritis drug filgotinib, which was developed in partnership with biotech firm Galapagos.

The FDA said it wanted more data on the impact the drug candidate had on patients' sperm counts before it could approve the drug, according to a press release. Gilead is currently running studies to determine what the impact would be, if any, and should have the data sometime next year.

The RA drug is expected to deliver billions in annual peak sales for Gilead, so the delay is a disappointment to shareholders who viewed filgotinib as the next leg of growth for the biotech giant.

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Shares of Galapagos fell as much 28% to $136.35 in Wednesday trades, while Gilead fell as much as 4% to $66.03.

Separately, on Wednesday morning, the FDA issued a CRL to BioMarin for its hemophilia A gene therapy valoctocogene roxaparvovec. The FDA is requesting more data on the durability of the drug candidate with its primary endpoint being annualized bleeding rate.

The expected timeline of when BioMarin will have the data the FDA is requesting in its CRL will be in late 2021 or early 2022, based on when the last patient will complete the two-year follow-up to its ongoing phase 3 study.

News of BioMarin's receipt of the CRL sent shares down as much as 32% to $80.46 in Wednesday trades.

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