US drugs giants Merck & Co Inc (NYSE:MRK) and Gilead Sciences Inc (NASDAQ:GILD) were among those to make large gains following the release of the Senate Republicans’ healthcare plan.
The bill aims to repeal and replace Obamacare, with deep cuts to Medicaid funding and the re-shaping of subsidies to low-income people for private insurance.
Analysts suggested that the new bill – which is set to be put to a vote before the 4 July break – could be more beneficial to big pharma than originally expected.
Healthcare stocks were also one of the best performers earlier this week on high hopes for eased regulations in the industry.
The Trump administration is reportedly drafting an executive order that would ease regulatory burdens on drugmakers in order to try and drive down drug prices.
US pharma companies have zipped higher throughout this week as a result, with the S&P healthcare index rising another 1% yesterday to hit a record close for the fifth day in a row.
Analysts have suggested that the uptick in the sector could also be down to investors moving away from technology stocks and looking to invest elsewhere.
Gilead gained a mighty 4.4% on Thursday to US$70.48, while the likes of Merck, Regeneron Pharmaceuticals Inc (NASDAQ:REGN) and Celgene Corporation (NASDAQ:CELG) all added the best part of 1%.
On Friday though prices eased back. Merck added 0.10%. Gilead lost 0.34%. Regeneron shed 2.55% to $513.10 and Celgene added 0.04% to $133.73.
BREAKING: Senate Republicans unveil health care bill scuttling Obama law; plan cuts Medicaid, slashes taxes for wealthy
— AP Politics (@AP_Politics) 22 June 2017