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Investing.com -- Shares of Gilead Sciences (NASDAQ: NASDAQ:GILD) fell 3.4% following a recent Wall Street Journal report indicating that the Health and Human Services Department is considering significant reductions in federal funding for domestic HIV prevention efforts. This potential policy shift is raising concerns about the impact on Gilead Sciences, a major player in HIV treatment and prevention.
The Wall Street Journal outlined that the proposed funding cuts could be announced imminently, although plans have not been finalized and could still be subject to change. The report comes amid broader discussions about personnel reductions at the Centers for Disease Control and Prevention (CDC), which is facing a reorganization that could exploit gaps in the legal framework defining the agency’s functions and authorizing its programs.
The CDC’s division dedicated to HIV and infectious disease prevention is particularly at risk, as it supports state and local HIV surveillance, syringe services, and community outreach initiatives. In the fiscal year 2023, the CDC allocated approximately $1.3 billion to prevent HIV, viral hepatitis, sexually transmitted infections, and tuberculosis, according to the agency’s website.
The Health Department has stated that it is adhering to the administration’s guidance and scrutinizing all divisions for potential overlaps that could be consolidated. This is part of a larger effort to restructure the federal government. A spokesperson for the department emphasized that no definitive decision regarding the streamlining of the CDC’s HIV Prevention Division has been made. Meanwhile, the CDC and the White House have not immediately responded to requests for comments on the matter.
Investors are closely monitoring the situation, as changes to government funding for HIV prevention could have significant implications for companies like Gilead Sciences that are deeply involved in the sector. The potential policy changes reflect a broader push within the current administration to reorganize and potentially downsize various government departments and programs.
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