Novo Nordisk drops more than 3% after Biden's statement 📉

President Biden communicated that if companies such as Novo Nordisk (NOVOB.DK) and Eli Lilly (LLY.US) refuse to significantly reduce the price of prescription drugs in the U.S., the government will do everything possible to end the greed prevailing in the pharmaceutical sector. 

Along with Senator Sanders, the government representatives referred to the obesity formulations Ozempic and Wegova, which put pressure on Novo Nordisk's stock. Obesity-fighting drugs are a key driver of earnings for both Novo Nordisk and Eli Lilly, hence the potential price cut on key products translates into a clear reaction from investors, who have been pricing in the potential for revenue generation in this rapidly growing market for the past few months. 

The president's statement also pulled the stock price of Eli Lilly, a U.S. company that, together with Novo Nordisk, is a leading player in the anti-obesity drug market. In pre-market trading, the company is losing more than -1.3%. 

Biden's speech continues the policy of strong negotiations on drug prices in the US under the Inflation Reduction Act (IRA). Pharmaceutical companies (including Astra Zeneca) attempted to stop the president's administration's moves by taking the case to court as an unlawful attack on their freedom to conduct business, but the lawsuit was dismissed, according to the court's decision. 

Response to President Biden's statements. Source: xStation