Biotech stocks have been on the rise since news outlets reported that President Donald Trump's executive order tackling drug prices will contain industry-friendly policies, according to Bloomberg Politics.
The Nasdaq Biotech Index surged 8 percent between Friday and Wednesday, which is the best three-day run since President Trump was elected in November, according to the report.
In January, when President Trump openly criticized pharmaceutical companies, saying they are "getting away with murder," biotech stocks plummeted as fears erupted that his administration would place aggressive restraints on drug prices. However, these fears are dispersing as the executive order reportedly favors the drug industry, according to Bloomberg Politics.
"It just sounds more and more likely that the focus is going to be on removing barriers to entry rather than a direct attack on pricing," Brian Skorney, an analyst at Robert W. Baird & Co., told Bloomberg Politics. "That's a pretty industry-friendly scenario if it does end up occurring."