The Nasdaq biotech index is up more than 50 percent since April 2014.
Read MoreBiotech sticks it to stocks
``This run in the biotechs is going to come to end at some point but I'm not panicking yet,'' said Bill Gunderson, president of Gunderson Capital in San Diego. ``You might just have a big institution reallocating a little bit of money here.''
The Dow Jones industrial average fell 42.17 points, or 0.23 percent, to 18,037.97, the S&P 500 lost 8.77 points, or 0.41 percent, to 2,108.92 and the Nasdaq Composite dropped 31.84 points, or 0.63 percent, to 5,060.25.
Also in healthcare, Mylan fell 5.7 percent to $71.72 after it rejected Teva Pharmaceutical's unsolicited $40 billion takeover offer, saying it ``grossly undervalues'' the company. Teva lost 4.3 percent to $61.63.
Read MoreUS services sector growth cools in April: Markit
The Health Care Select Sector SPDR exchange-traded fund was down 1.8 percent. After the bell, Apple shares gained 1.1 percent as the iPhone maker reported a 27 percent jump in quarterly revenue. Its shares ended the regular session up 1.8 percent at $132.65.
NYSE declining issues outnumbered advancers 1,923 to 1,130, while on the Nasdaq, 1,956 issues fell and 805 advanced. The S&P 500 posted 14 new 52-week highs and 1 new low; the Nasdaq
Composite recorded 101 new highs and 42 new lows.
About 6.8 billion shares changed hands on U.S. exchanges versus the 6.2 billion daily average for the month to date, according to data from BATS Global Markets.