Already reeling from years of market chaos, the announced departure of CBER chief Peter Marks sent a ripple across biopharma markets.
“Arguably biotech investors’ greatest fear” came true over the weekend, according to analysts. Peter Marks, the venerable chief of the FDA’s Center for Biologics Evaluation and Research, is stepping down, forced out by new Health and Human Services Secretary Robert F. Kennedy Jr.
Already reeling from years of market chaos, the revelation sent shares across the industry tumbling, with the S&P biotech index, the XBI, sliding by more than 5% on Monday. The index includes biotech heavy-hitters like Gilead, AbbVie and Amgen, plus smaller companies like Arcellx, Viking Therapeutics and Summit Therapeutics.
Vaccines companies were particularly impacted, including big names like Pfizer and Merck, BMO noted. But companies with biologics products like antibodies and cell therapies were not immune either.
“It’s no secret that biotech has been under immense pressure recently given broader macro issues, this unfortunate update does nothing to reassure investors or provide relief,” BMO Capital Markets analysts said in a note Monday.
On his way out, Marks warned in his resignation letter that the HHS chief expressed no interest in learning more from Marks or anyone else about vaccine safety and efficacy. “It has become clear that truth and transparency are not desired by the secretary, but rather he wishes subservient confirmation of his misinformation and lies.”
Company executives began speaking up on LinkedIn, expressing horror over the departure.
“We have been told over and over ‘don’t worry, RFK will not interfere with vaccines or reviewers at FDA.’ Now he’s crossed the red line on both,” Nkarta CEO Paul Hastings wrote on LinkedIn on Sunday. Hastings’ company, which is working on cell therapies for autoimmune disorders, fell from about $2 before the weekend to $1.79 on Tuesday morning as the markets opened.
Marks was “perhaps the biggest FDA advocate of cell and gene therapies,” BMO wrote. Many of these stocks fell dramatically after the resignation.
Posting Marks’ resignation letter in its entirety, Ovid Therapeutics CEO Jeremy Levin, who has been outspoken in his objection to recent cuts at the FDA, warned that American biopharma leadership is in jeopardy.
“This letter should shake us all,” Levin wrote. “It signals that the very infrastructure we rely on to evaluate, approve, and monitor life-saving medicines—and to protect patients from harm—is at risk of collapse. The implications are vast. The consequences for biomedical innovation, public trust, and America’s role as a global health leader are profound.” Ovid, which has already had a tough year and is down about 66% year to date, fell over 11% on Monday to 31 cents.
Shehnaaz Suliman, CEO of privately held ReCode Therapeutics, vowed to stand by anyone at the FDA who remains willing to uphold the agency’s core responsibilities. “I, like most, stand in support of those who remain who believe in Peter’s vision and hopefully will be allowed to continue to advance the FDA’s work.”
Guggenheim noted Marks’ major successes: Operation Warp Speed, gene therapy accessibility, the embrace of surrogate endpoints, smoothing the regulatory path for genome editing into the clinic and moderating stem cell clinics.
Marks was also pivotal in pushing through Sarepta Therapeutics’ Duchenne muscular dystrophy gene therapy Elevidys, William Blair noted. Jefferies wondered if other key FDA officials would depart in Marks’ wake.
“The resignation of a singular but top FDA official right as Dr. Marty Makary begins his tenure as the new FDA commissioner poses questions as to what the ‘new norm’ of FDA will be,” Guggenheim wrote.
Analysts had hoped that Makary would be a sane voice at the agency, with William Blair remarking on Monday morning that “there is some hope that his influence will ensure a suitable candidate” to replace Marks. But then, on Monday afternoon, Politico broke the news that Makary himself personally signed off on Marks’ dismissal. In fact, it was his first act.
