US, European pharma stocks steady after Trump’s tariff move, Asia slips
Shares of U.S. and European pharmaceutical firms were little changed on Friday, while Asian drugmakers declined, after President Donald Trump announced 100% tariffs on branded drugs imported by firms that are not building plants in the U.S.
Analysts said the move was widely expected and unlikely to materially hit the industry, given that most drugmakers have pledged billions of dollars in U.S. manufacturing investments.
The conditions sort of weaken the announcement, which is probably why the market is not overly reacting, said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
Shares of Eli Lilly (LLY.N), opens new tab rose 1.3% while Bristol Myers Squibb (BMY.N), opens new tab, Merck (MRK.N), opens new tab, Amgen (AMGN.O), opens new tab and Pfizer (PFE.N), opens new tab were up marginally.
Overall, this is a win for pharma and should not have a material impact, given most companies have announced they are building manufacturing facilities in the U.S., Jefferies analyst Akash Tewari said.
EUROPEAN SHARES HOLD UP
In Europe, Zealand Pharma (ZELA.CO), opens new tab, Novo Nordisk (NOVOb.CO), opens new tab slipped 2.5% and 1.9%, respectively, while Roche (ROG.S), opens new tab was down marginally.
Bayer (BAYGn.DE), opens new tab Novartis (NOVN.S), opens new tab and Lonza (LONN.S), opens new tab rose marginally.
“A lot of investors were expecting these kinds of tariffs, and it was partly reflected in valuations,” said Nabil Milali, portfolio manager at Edmond de Rothschild Asset Management.
“There are also expectations this will not be the end game of the Trump administration, but a starting point for negotiations.”
ASIA DECLINES
Of Asia-Pacific companies with U.S. exposure, Japan’s Sumitomo Pharma (4506.T), opens new tab closed down 3.5%, while Australia’s CSL (CSL.AX), opens new tab hit a six-year low.
Lorraine Tan, director of equity research for Asia at Morningstar, said the final tariff rate should be lower given the pattern of negotiations so far, but that near-term uncertainty could weigh on share prices.
Other analysts expected a limited impact on Asian drugmakers, as many focus on generic drugs, especially in China and India. Europe and Japan should also get some shelter as a result of trade deals, although industry representatives said this was not yet clear.
