Healthcare stocks, particularly in the biotech field and the associated exchange traded funds lurched recently after Trump pointed out on the surging drug prices at a press conference.
The Health Care Select Sector SPDR saw a drop of over 1%. Whereas, the biotech-related ETFs was stomped, with ALPS Medical Breakthroughs ETF down to 4.5%, PowerShares Dynamic Biotech & Genome dropping as much as 4.2% drop, and BioShares Biotechnology Clinical Trials Fund down to 4.3%.
Trump recently stated he will induce the pharmaceutical and biotechnology industries to bid for government businesses to reduce consumer expenditure. Trump believes the Pharma sector has a lot of power and campaigners with very little bidding. In addition, US being the largest buyer of drugs in the globe, it fails to have a proper structure of bidding. If the pharma sector could be engaged better into bidding programs the nation could save a lot of money.
In recent times the healthcare industry has been hoping that trump to create a more business-friendly atmosphere for the sector. However, it seems that he is introducing some of the ideas that were adopted by the Democrats during the election campaigns as he points out on skyrocketing prices of the drugs a general issue that has been discussed by many American consumers.
Remarkably, the US does not directly determine the price of medical products. Earlier, President Barack Obama suggested on permitting the country’s Medicare program to negotiate prices for organic molecules biologics and other similarly expensive drugs. The US administration is persistently restrained from regularizing prices along with drug makers in the US Medicare program. Meanwhile, the Senate is planning to take a voting on testing the support for such altercation in coming days.