Guilt by Association Slaughters Idenix

Investors spied a potential problem at Idenix and responded harshly on Thursday morning, sending the pharmaceutical company’s stock down 31% at the opening bell.

And just what was so bad at Idenix? Nothing actually. But over at Bristol-Myers Squibb, the company suspended one of its hepatitis C drugs, which raised concerns about the treatment’s heart safety.

The reason why Idenix was slaughtered as a result was because its own drug is a similar treatment, raising concerns about the safety of Idenix’s IDX184. As a result, Idenix put the drug on partial clinical hold as the Food & Drug Administration (FDA) studies whether IDX184 could have similar issues to Bristol’s drug.

"In previous clinical trials as well as the ongoing Phase IIb clinical trial of IDX184 in combination with pegylated interferon and ribavirin (PegIFN/RBV), there has been no evidence to date of cardiotoxicity in patients dosed with IDX184 with PegIFN/RBV beyond that seen with PegIFN/RBV alone," Idenix said in a statement Thursday morning.

Idenix currently isn’t giving any of the drug to patients and it is submitting additional data on patients treated with IDX184 to the FDA.

Idenix closed down by 30% at $5.84. This was a big hit for the stock, which less than a month ago was trading over $10.

Early this morning Bristol’s own stock fell by less than a percent before rallying and closing the day up by 0.13% at $31.92.