Health Care Stocks Crumble After Trump Tweets Drugs Prices Will Come Down [VIDEO]
President Donald Trump's tweet brought health care stocks tumbling after claiming that he is currently working on a new system that will compete in the current drug industry in the United States. This new system will bring US drug prices down according to the US President.
CNBC reports that pharmaceutical stocks experienced its biggest flip in the S&P 500 early Tuesday morning, March 7 and closed a little more than a half percent after Trump's claims on his Twitter account. In line with the repeal and replacement of the Affordable Care Act, the President claims that he is also making moves to decrease US drug prices, thus sending the IBB shares to fall in its worst day for seven weeks.
The iShares Nasdaq Biotechnology ETF, also known as the IBB dropped by 1.6 percent, together with big names in the pharmaceutical industry landing in red territory. Pfizer fell a little more than one percent, GlaxoSmithKline and Merck lost almost one percent, while Novartis closed the day down losing nearly two percent.
EpiPen allergy shot-maker Mylan declines nearly 2%, as much as Perrigo, the manufacturer of private label OTC pharmaceuticals. Tenet Healthcare lost more than 7% by the market close, while Community Health Systems lost more than 9%, all due to Trump's tweet about his plans for the US drug prices.
Although Tuesday was a bad day for pharmaceutical stocks, S&P 500 gained more than 10% over the past 12 months and more than 8 percent for the year, Vox reveals. Yesterday's unlikely turn of events for pharmaceutical stocks was due to the changes implemented by the Affordable Care Act, mostly by the dominant House Republican in the Senate and the Congress.
The repeal of the Affordable Care Act, also known as the Obamacare will result to fewer people covered with health insurance, elimination of the largest fund for disease prevention on the federal budget, and decrease in funds for the Centers for Disease Control and Prevention, by 2019.