Following the resignation of the US Food and Drug Administration’s (FDA) top biologics official, Peter Marks, the stocks of pharmaceutical companies experienced a decline on Monday. As the director of the FDA’s Center for Biologics Evaluation and Research, Marks played a key role in the development of gene therapies and COVID-19 vaccines during the Trump administration.
According to a Reuters report, Marks was forced to resign after being presented with a choice by a senior official at the Department of Health and Human Services: either resign or be terminated. Marks will officially step down on April 5.
Marks’ departure has been described as the “most prominent departure” from the FDA to date, according to Reuters. In his resignation letter, Marks reportedly criticized the views of new Health Secretary Robert F. Kennedy Jr. on vaccines.
The decline in pharmaceutical stocks began even before Marks’ resignation, with investors concerned that President Trump’s plans for tariffs may include medicines previously exempt from such fees. Additionally, the planned restructuring of the US health agencies, which could lead to the layoff of thousands of employees, has raised concerns among pharmaceutical investors.
The entire pharmaceutical and biotech sector has been under pressure since Trump’s presidency, with the sector’s stocks experiencing a decline.
Following the announcement of Marks’ departure, the stocks of companies specializing in vaccines, such as Novavax and BioNTech, fell by 6 to 8 percent. Developers of gene therapies, including Taysha Gene Therapies, Solid Biosciences and Sarepta Therapeutics, experienced even greater losses, with their stocks declining by 14 to 30 percent.
The S&P 500 biotech ETF fell by 4.9 percent, as the uncertainty surrounding Marks’ departure added to the concerns of biotech investors.
Evan Seigerman, an analyst at BMO Capital Markets, described the resignation as an “unfortunate event” that did not contribute to the calming of investors. William Blair analyst Matt Phillips characterized Marks’ departure as a significant setback for the pharmaceutical industry, stating that the uncertainty surrounding his replacement and the future of his legacy would have a significant short-term impact.