By David Wainer

Biotech investors are reeling after the sudden departure of Dr. Peter Marks, a pivotal figure in the U.S. Food and Drug Administration.

Marks, who played a crucial role in Operation Warp Speed and championed accelerated drug approvals, announced he was stepping down, citing irreconcilable differences with Health and Human Services Secretary Robert F. Kennedy Jr.

His exit sparked worry the FDA's stance on drug approvals-particularly for more innovative treatments like gene therapies and mRNA vaccines-could shift under Kennedy's leadership.

On Monday, biotech stocks suffered their worst single-day drop in months. Moderna shed 13%, gene-editing company Beam Therapeutics dropped 10%, and gene therapy maker Sarepta Therapeutics fell 9%.

Marks' departure confirmed many investors' worst fears-that RFK Jr.'s influence over the FDA could extend beyond vaccines to the entire drug-approval process.

Marks is the third top official at the FDA to leave this year, following the departures of drug chief Dr. Patrizia Cavazzoni and human foods chief Jim Jones. For the last few months, many on Wall Street have tried to stay upbeat, arguing that Dr. Marty Makary, a former Johns Hopkins surgeon recently confirmed as commissioner of the FDA, is a science-driven leader who can shield drug companies from RFK's worst instincts.

Yet on Monday, the question was what kind of FDA will emerge-a RFK Jr. or a Makary one. "Will new FDA Commissioner Marty Makary be able to support scientifically-proven research and products and effectively manage upward with RFK Jr., or will he ultimately face the same fate as Dr. Marks?" wrote David Risinger, an analyst at Leerink Partners.

At this point, it is hard to stay optimistic for vaccine companies. That helps explain why Moderna is down 75% so far this year. But the threat to drug stocks may not be as severe. The risks may be increasing, but so are the discounts.

This analysis comes from the Journal's Heard on the Street team. Subscribe to their free daily afternoon newsletter here.

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March 31, 2025 11:05 ET (15:05 GMT)

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