Right from his campaigning days, President Trump was slamming the US pharma companies for the high drug prices. In his first press conference after getting elected, he accused that the drug companies are “getting away with murder”. On Monday, he pointed out particularly Pfizer (PFE) and other pharma companies that they “should be ashamed” for increasing drug prices. However, at the end of today’s trading session, investors showed relief since the pharma stocks were not affected by Prez’s comments.
Early this year, POTUS had said that he had asked his administration to work on reducing the high drug prices and keep it as one of the top priorities for the year. In March, he expressed that the drug prices will be falling substantially in the near future. In early May, Trump unveiled a plan to reduce drug prices and during the month end, he added that the pharma companies will announce about a massive price cut in two weeks. But nothing has fallen into place so far.
Related: Studies say Americans spend more on healthcare
Last week, it was reported that Pfizer had increased the prices of its many drugs, including Viagra. Apart from Pfizer, few other pharma companies also have increased their drug prices this year. Meanwhile, pharma companies defend the price increases citing the high research costs involved in producing drugs.
According to National Center for Biotechnology Information (NCBI), the total US prescription sales in 2017 has increased 1.7% year-over-year to $455.9 billion and total drug expenditures are projected to grow 3-5% in 2018.
After Trump’s tweet, shares of Pfizer dropped suddenly and rebounded in the afternoon session and ended the day with a slight increase (+0.1%). Other pharma sector stocks namely, Merck (MRK -0.3%), Eli Lilly (LLY +0.6%), Johnson & Johnson (JNJ +0.2%) and Novartis (NVS +0.4%) didn’t move much either way. Until Trump announces some concrete measures to regulate the drug prices, pharma companies will not get affected and they will continue to enjoy the present situation.