Business - - Nov 11,2016
Stocks of the Pharmaceutical sector were burdened on Friday after the US Department of Justice reported about the price collusion which involved top companies
This anti-trust probe was initiated two years back and involves around twenty companies which are under the scanner. Popular firms such as Sun Pharmaceutical Industries along with its subsidiary Taro have been named in the list.
Federal antitrust regulators were called this week by Rep. Elijah Cummings and Sen. Bernie Sanders in order to confirm whether Eli Lilly, Novo Nordisk, Merck and Sanofi SA tried to plot the prices for different diabetes drugs including insulin. Other drugmakers who have been summoned for interrogation include Mylan NV and Teva Pharmaceutical Industries Ltd, Mylan NV and Actavis.
The situation has gone crazy since the pharmaceutical stocks are hampered due to this drug overpricing issue. Collusion charges on the price involves 25 drugs which has directly brought the sector under serious criticism. The stocks of Sun Pharma dipped by a significant 7 percent on Friday. Apart from this, other companies which are exposed to the US market like Glenmark, Lupin, Aurobindo Pharma and Dr Reddy's Laboratories have also been thrashed. On an average, the pharma sector stocks were low by 3-5 percent.
Another major concern is the uncertain US elections which has indeed disturbed the pharma stocks to some extent. Selling pressure is one of the negative impacts due to this election tension. The drug pricing matter has slowly transformed into a political issue and is used as a weapon to acquire more limelight. But the politicians are unaware about the detailed picture of the concerned fiasco. Presidential candidate Hillary Clinton spoke against the pharmaceutical companies for raising the drug prices, which is infact not the complete scenario that has affected the global pharmaceutical sector.