Upheaval for healthcare-related stocks was a lock the moment Robert F. Kennedy, Jr. was confirmed as the U.S. Health and Human Services secretary in February.
And the vocal vaccine skeptic with many questionable theories about the medical world has wasted little time sowing chaos in this sector.
In fact, nine of the top 10 losers on Tuesday were pharmaceutical or biotech stocks.
Among the top five Tuesday losers, Corcept Therapeutics (CORT) had the steepest drop, losing 19.5%. Vaxcyte (PCVX) was down 14.7%, Immunovant (IMVT stock) lost 11.1% and Ionis Pharmaceutical shed 9.7%.
The losses came as Kennedy makes broad spending cuts across U.S. government health agencies — including the Food and Drug Administration (FDA), the National Institutes of Health (NIH) and the Centers for Disease Control and Prevention (CDC).
Former FDA Commissioner Robert Califf wrote in a post on LinkedIn on Tuesday about how the job cuts have transformed the FDA.
"The FDA as we've known it is finished, with most of the leaders with institutional knowledge and a deep understanding of product development and safety no longer employed," Califf wrote. "I believe that history will see this as a huge mistake."
The S&P 500 Pharmaceuticals Industry Index was down 3.8% on Tuesday.
Peter Marks, a top vaccine scientist at the FDA, quit on Friday, sending biotech and pharmaceutical stocks into a tailspin.
The S&P 500 Pharmaceuticals Industry Index was down 3.8% on Tuesday. The SPDR S&P Biotech exchange traded fund (XBI), which is a key ETF of biotech stocks, also lost 3.6% on Tuesday.
RBC Capital Markets analyst Brian Abrahams wrote in a report that Mark's resignation was not unexpected, but it puts the biotech industry in a challenging spot.
"Marks has been a vocal stickler for science, and RFK Jr.'s controversial views on vaccinations has become somewhat of a flashpoint, but the news is not good for the biotech industry even beyond vaccines," Abrahams wrote
"Marks has been a key advocate for more flexible, efficient approval processes for drugs — particularly for orphan diseases."
Other Wall Street analysts have gotten more pointed in their assessment of what is happening with the government's health agencies.
In response to Marks' resignation, Cantor Fitzgerald biotechnology analysts Josh Schimmer and Eric Schmidt called on the White House to fire Kennedy as health secretary in a note they published on Monday.
"RFK Jr. is undermining the trusted leadership of healthcare in this country," the analysts wrote. "HHS cannot be led by an anti-vax, conspiracy theorist with inadequate training."
Schimmer and Schmidt are two of the most prominent investment bank analysts covering biotechnology stocks.
While most analysts focused on how the government upheaval would impact stock prices, Schimmer and Schmidt called on drug companies to speak out about the potential impact on people's health.
"This has nothing to do with biopharmaceutical sales," they wrote.
"Several industry leaders have been playing nice with the administration in an effort to protect their businesses. It's time to take a stand against something that is more important than bottom lines."
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