Donald Trump inflicted a £14 billion blow on the UK drug sector.
That was the collective impact on the valuations of AstraZeneca PLC (LSE:AZN) and GSK PLC (LSE:GSK, NYSE:GSK), which dropped sharply on Wednesday after Donald Trump said the US would soon impose “a major tariff on pharmaceuticals”.
His plan, if there is one, is to bring drug manufacturing back to American soil.
The President’s remarks, made in a speech to Republican supporters, rattled investors and heightened trade tensions.
“We’re going to tariff our pharmaceuticals and once we do that they are going to come rushing back into our country because we are the big market; the advantages we have over everybody is that we’re the big market,” Trump said.
“So we’re going to be announcing very shortly a major tariff on pharmaceuticals.”
Trump's trade adviser, Jamieson Greer, said tariffs should be used to “run up the score” as part of efforts to reduce a $1.2 trillion global trade deficit.
AZ shares were the biggest fallers on another turbulent day for the markets as they shed almost 7%. GSK fell 5.7%.
Earlier in the week, the European pharmaceutical industry had met the European Commission president Ursula von der Leyen to push for “rapid and radical action” to mitigate the “risk of exodus” from companies investing in shifting manufacturing to the US.
** Update: updated prices used, detail added **