Consumers should get a break from high drug prices. Last week, several large-capitalization drugmakers signed a deal to sell their drugs at a lower cost. That would align with the White House Administration’s desire to align drug prices with the cheaper ones found abroad.
Sanofi (SNY), GSK (GSK), Gilead (GILD), Amgen (AMGN), Bristol Myers Squibb (BMY), and Merck (MRK) are among the firms involved. In return for selling drugs at lower prices, the company will have a three-year grace period where their goods are not subjected to Trump-related tariffs on pharmaceuticals.
After the news, BMY stock is a notable strong performer. Shares closed at $54.19, a price not seen since April.
Trump said that the deal is a victory for patient affordability.
Companies that did not sign on to the deal included Johnson & Johnson (JNJ), Regeneron (REGN), and AbbVie (ABBV). Still, the President expects J&J to be on the list this week.
Shares of AbbVie are nearing a peak, after the rally to $164.39 lost momentum in October. Regeneron (REGN) broke out of a $500 - $600 range in November. The stock traded as high as $790.98.
Your Takeaway
The Supreme Court has not ruled yet on the legality of tariffs. Assume that the court rejects the lower court ruling, deeming it illegal. In that scenario, the above-listed companies have less uncertainty ahead. That should help their share price recover further.
