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Investing.com - Shares of European drugmakers fell on Friday after President Donald Trump issued letters to more than a dozen pharmaceutical groups arguing for them to lower U.S. prescription drug costs to those paid overseas.
Major regional names like AstraZeneca (NASDAQ:AZN), GSK and Merck (NSE:PROR) KGgA all dropped by more than 1% in early dealmaking, with an index tracking the wider sector dipping to its lowest level since April.
Novo Nordisk (NYSE:NVO), in particular, dropped by more than 4%, extending a recent slump in the stock sparked by a profit warning and CEO change that raised concerns over the future of its blockbuster weight-loss medications. Novo’s shares plunged by 28% on Tuesday, erasing some $70 billion off of its market value.
All of these companies, along with U.S. giants like Johnson & Johnson (NYSE:JNJ), Eli Lilly (NYSE:LLY) and Pfizer (NYSE:PFE), were part of the 17 firms sent the letters by Trump. The White House gave them until September 29 to deliver binding commitments to its terms -- although observers have suggested that the companies are unlikely to comply with Trump’s demands, Reuters reported.
The NYSE Arca Pharmaceutical (TADAWUL:2070) index dropped by 3% on Thursday, dragged down in part by falls in shares of Pfizer, Eli Lilly and Gilead Sciences (NASDAQ:GILD).
Still, several firms have said they are willing to work with the Trump administration to address its concerns, with Swiss player Roche noting last week that it was mulling selling prescription drugs in the U.S. directly to consumers as part of a bid to lower prices for patients.
Trump previously issued an executive order in May directing pharmaceutical companies to set drug pricing in the U.S. equal to those abroad, warning these businesses that government rules or measures could be employed to enforce its demands.
(Reuters contributed reporting.)