Here are three takeaways.
1. Mr. Nisen suggests President Trump is simply “crying wolf” when it comes to tackling high drug prices.
“[T]he wild inconsistency of his stances, along with Republican party divisions, have combined to make real price curbs less likely,” he said.
2. Mr. Nisen cited the weakening relationship between the president’s comments on drug prices and the biotech stocks. When President Trump tweeted on Tuesday about a “new system” he’s working on to boost competition and lower drug prices, the Nasqaq Biotech Index fell less than after previous statements Trump made about the drug industry.
3. He also cited President Trump’s Wednesday meeting with Reps. Elijah Cummings, D-Md., and Peter Welch, D-Vt, about legislation that would let Medicare negotiate drug prices. The proposal would let Medicare develop a preferred drug list and refuse to pay for specific drugs to boost its negotiation power and lower prices, according to Mr. Nisen. Despite the large threat this system would post to the drug industry, the NBI rose the day after the White House meeting, sad Mr. Nisen.
“If Trump is truly behind the Cummings plan, then it would be disastrous for the sector,” said Mr. Nisen. “The market shrug suggests investors have come to believe Trump will say whatever a given room wants to hear and that the meeting was not a serious indication of support.”
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