Chinese drug developers with product and cost advantages could emerge unscathed from US President Donald Trump’s latest attempt to slash prices of medicines, bring back manufacturing jobs and potentially slap tariffs on pharmaceutical imports, analysts said.
US consumers would pay no more than drug prices charged in other high-income nations, which Trump said on Sunday were 30 to 80 per cent cheaper than in the US. The move raised concerns that profits of firms across the supply chain would be squeezed, triggering a rout in pharmaceutical stocks on Monday.
Innovent Biologics, an industry bellwether based in Suzhou in the eastern Jiangsu province, tumbled 5.7 per cent to HK$49.40 in Hong Kong trading on Monday. Beigene, which has substantial operations in mainland China and the US, slumped 9 per cent to HK$127.80, after falling earlier by as much as 11 per cent.
Trump said in a social media post that he would sign an executive order on Monday, the latest in a string of policies that could have long-term ramifications to cross-border trade. He had attempted something similar during his first term, according to Jefferies, but was blocked by federal courts and rescinded by then-president Joe Biden in 2021, it added.
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China’s new cancer drug gets US approval at huge price mark-up
China’s new cancer drug gets US approval at huge price mark-up
“We believe innovative therapeutics with proven clinical efficacy, especially the ones that challenge existing standards of care, would be immune to pricing pressure,” said Cui Cui, head of healthcare research for Asia. “Moreover, China biotech out-licensing [of drug candidates development rights] could accelerate.”
