Pharmaceuticals rally: Pfizer-US deal paves the way for new agreements

Pfizer's agreement with the Trump administration on tariffs and drug prices paves the way for pharmaceuticals, which celebrated on the stock exchange. The Stoxx Europe 600 Health Care index closed today, 1 October, up 5.25 per cent, almost completely recovering what it had lost since the beginning of the year. AstraZeneca with its best session in six months (+8.35%), Sanofi (+8.32%), Roche (+6.47%) and Novo Nordisk (+6.35%) led the sector.

The agreement announced on Tuesday between Pfizer and the US government, which provides for a three-year moratorium on tariffs announced by President Donald Trump on drugs, could, according to analyst Richard Vosser of JPMorgan Chase, constitute a model that can also be replicated by other European pharmaceutical groups. So much so that there are already other large groups, such as Gsk (+5.62%), which have entered into negotiations along these lines with Washington. 'It's about maintaining a constructive dialogue between industry and government,' said Emma Walmsley, outgoing CEO of the British giant at the end of the year, at a conference, where she was keen to emphasise that the group is 'putting all its eggs in the US basket'.

Switzerland's Novartis (+1.85%) is also moving in the same direction, announcing that it is engaged in discussions with the US administration in search of "constructive solutions", while Germany's Merck, which had gained almost 7% but then fell back to +3.76%, confirmed direct contacts with the US government.

Returning to the agreement between Pfizer and the Trump administration, in detail, the deal involves the sale of a selection of drugs at an average discount of 50 per cent through a new direct-to-consumer platform called TrumpRx. The initiative aims to give American citizens access to therapies at capped prices, negotiated directly by the government. "We will ensure that Americans pay prices comparable to foreign prices," said CEO Albert Bourla, explaining that new drugs will also be launched at international price parity, in response to one of the US administration's key criticisms.

The possibility of 100% tariffs on imported and patented drugs as of 1 October (unless manufacturers are building production plants on US soil), as President Trump announced last week, thus seems to have been averted.