Wednesday, 11 January 2017
Trump on Drug Prices: Pharma/Bio Stocks Drop
Some have criticized Donald Trump for backing off of some of his campaign promises. However, in a press conference on January 11, 2017, Trump reiterated his concern with drug prices stating that drug companies "are getting away with murder." I don't know if he could have expressed himself in stronger terms. Notably, the Washington Post reported that the stock of pharmaceutical and biotechnology companies dropped after the press conference and that concerns were expressed by one biotechnology insider that venture capitalists may move away from biotechnology companies. This is troubling given the competition that already exists for venture capital funds from software startups and the promise of expensive to develop biologics. Moreover, some successful securitization deals have greatly benefited a few universities. The move to take a big step toward drying up the pipeline for new biologics may not be the best approach. What are some other ideas Trump could consider? Should Trump look to other developed countries to help carry the supposed very high cost of pharmaceutical/biologic development? That's not very satisfying. Should the government invest more public funds into research and development? For more on pharmaceutical pricing, see here, here and here.