Big Pharma’s big players see Trump moving in on drug prices
President Donald Trump has been an outspoken critic of the high drug prices in America, frequently using Twitter to berate the sector. On at least one occasion, this spooked investors, and sent pharmaceutical shares sharply downwards – but it hasn’t all been bad news: Trump met with senior industry people earlier this year, and they were reassured by the conversation. Now, two of the biggest drugmakers in the world – Allergan and Novartis – think his administration is ready to take action.
Novartis’ share price is up 12% year-to-date
SOURCE: Yahoo Finance
According to Novartis’ CEO, Joe Jimenez, and Allergan’s CEO, Brent Saunders, proposals are expected in the next few weeks or months. They say U.S. health and human services secretary Tom Price has been meeting with a range of industry professionals – from pharmacists to care providers – to discuss how American drugs could become cheaper.
According to Saunders: “The White House is continuing to be thought-provoking and thoughtful around these issues, looking for ways to increase competition but also encourage investment in R&D. My sense is that we should expect the Trump administration to continue to talk about and look for ways to take action with respect to pricing pharmaceuticals. I think that should be the baseline and built into the baseline, and that’s something that frankly we at Allergan have been thinking about for a couple of years.”
Novartis’ Jimenez was similarly confident in his company’s ability to thrive in Mr. Trump’s new pharmaceuticals environment, saying that he expects “to have a solution that will preserve the business model of how we innovate and discover and develop and launch into the U.S., as opposed to some of the bigger and more draconian elements that were discussed earlier.”
Dominion holds a number of pharmaceutical companies in its Global Trends Managed Fund, including Novartis and Allergan.
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