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On Monday, Truist Securities provided preliminary insights into the potential effects of a forthcoming executive order from the White House on drug pricing. During a press briefing earlier today, President Trump and Health and Human Services Secretary RFK Jr. emphasized the need for both the lowering of drug prices in the U.S. and an increase in drug prices abroad to share the burden of innovation costs. The president specifically targeted drugs for breast cancer, weight loss, and asthma.Want to stay ahead of major policy changes affecting pharmaceutical stocks? InvestingPro offers comprehensive analysis of over 1,400 healthcare companies, including detailed Pro Research Reports that transform complex Wall Street data into actionable intelligence.
The White House also expressed a willingness to import cost-effective drugs from other countries to improve trade deals, although tariffs could be a consequence. Additionally, President Trump proposed eliminating intermediaries to reduce drug costs and minimize pharmaceutical lobbying. Despite these announcements, details on list versus net prices and specific targets were not provided.
Truist anticipates that the initial focus of the executive order will likely be on branded drugs with sales outside the U.S. from OECD member countries, potentially sparing generic drug companies like Amneal Pharmaceuticals (NYSE:NASDAQ:AMRX) and ANI Pharmaceuticals (NASDAQ:ANIP) from immediate impact. Amneal, despite having some international exposure, along with Biote (NASDAQ:BTMD) and CorMedix (NYSEAMERICAN:CRMD), which have minimal to no exposure outside the U.S., might face less immediate concern.
Conversely, companies with significant sales outside the U.S., such as Bausch Health (NYSE:BHC), Collegium Pharmaceutical (NASDAQ:COLL), and Pacira BioSciences (NASDAQ:PCRX), might be subject to negotiation pressures. Pacira, currently generating $702.77 million in annual revenue with a healthy 65.94% gross margin, appears undervalued according to InvestingPro analysis. The company maintains strong liquidity with a current ratio of 2.41 and has shown impressive momentum with a 49.52% price return over the past six months. DRI Healthcare (TSX:DHT.UN), indirectly, could also be affected through negotiations by its royalty originators.Discover more insights about PCRX and other pharmaceutical companies with InvestingPro, which offers 10+ additional ProTips and comprehensive financial metrics for informed investment decisions.
Truist also referenced two prior initiatives that encountered obstacles: the Most Favored Nation Model, proposed in November 2020, targeted branded drugs and select biosimilars but was rescinded in December 2021. The "Medicare $2 Drug List Model," proposed in October 2024 to standardize costs for low-cost generics for Medicare Part D holders, was also not implemented as announced in March 2025. With these past challenges in mind, Truist believes the new executive order will focus on branded medicines and could face congressional hurdles.
In other recent news, Pacira Biosciences Inc. reported its Q1 2025 earnings, revealing a revenue shortfall that fell below analyst expectations. The company reported total sales of $164.9 million, missing the forecasted $175.6 million, primarily due to decreased sales of its product ZILRETTA. Despite this, Pacira’s flagship product, EXPAREL, showed an increase in sales, reaching $136.5 million compared to $132.4 million in 2024. The company also reported a strong non-GAAP gross margin of 81%, an improvement from the previous year’s 72%.
In addition to the earnings report, Pacira has set a total revenue guidance for 2025 between $725 million and $765 million, focusing on expanding its market share through new programs and product innovations. The company is optimistic about the impact of its "No Pain" program in the latter half of the year. In other developments, Pacira recently settled its patent litigation for EXPAREL, extending its exclusivity until 2039, which is expected to provide long-term growth opportunities.
Furthermore, Pacira announced a new $300 million stock repurchase program, doubling the amount authorized under the previous program, indicating confidence in its growth outlook. Analyst discussions during the earnings call highlighted the company’s strategic initiatives and the potential of its pipeline product, PCRX-201, which is aimed at treating osteoarthritis. The company is also actively monitoring potential tariff impacts, though it does not anticipate a material effect on operations at this time.
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