Trump abandons drug rebate proposal, criticizes Facebook's Libra digital currency
Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Donald Trump and his administration with this weekly recap compiled by The Fly:
1. DRUG REBATE RULE: The Trump administration has withdrawn its proposal to eliminate rebates from government drug plans, a White House spokesperson confirmed to Politico, Dan Diamond and Adam Cancryn reported earlier this week. Spokesperson Judd Deere said in a statement, "Based on careful analysis and thorough consideration, the President has decided to withdraw the rebate rule. The Trump administration is encouraged by continuing bipartisan conversations about legislation to reduce outrageous drug costs imposed on the American people, and President Trump will consider using any and all tools to ensure that prescription drug costs will continue to decline." Publicly traded pharmaceutical distributors include McKesson (MCK), Cardinal Health (CAH), Amerisource (ABC) and Patterson (PDCO). Owners of pharmacy benefit managers include CVS Health (CVS), UnitedHealth (UNH), Anthem (ANTM) and Cigna (CI).
Commenting on the news, Raymond James analyst Chris Meekins called the decision "a win" for PBMs and distributors and "a slight negative" for the pharmaceutical makers. Publicly traded large cap drugmakers include AstraZeneca (AZN), Bristol-Myers (BMY), Eli Lilly (LLY), GlaxoSmithKline (GSK), Johnson & Johnson (JNJ), Merck (MRK), Novartis (NVS), Pfizer (PFE), Roche (RHHBY) and Sanofi (SNY).
2. EXECUTIVE ORDER ON KIDNEY HEALTH: On Wednesday, President Trump signed an executive order "aimed at improving kidney health and promoting increased treatment options for American patients." Under the executive order, Medicare will test adjusting payment incentives to encourage preventative kidney care and the use of home dialysis and kidney transplants. President Trump is also directing his Administration "to develop a process to get artificial kidneys to patients in order to encourage development of such technology." Shares of both Davita (DVA), Fresenius Medical Care (FMS), and CareDx (CDNA), which develops diagnostic solutions for transplant recipients, rose following the news. Also higher were providers of home health services, including LHC Group (LHCG) and Amedisys (AMED).
3. FACEBOOK: President Trump, who has already been a vocal critic of Facebook (FB) over what he perceives as bias on its platform, is now taking aim at the social media giant's digital currency plans. In a tweet on Thursday night, the president said he is "not a fan of Bitcoin (BTC) and other Cryptocurrencies," adding that he think the Libra virtual currency "will have little standing or dependability." If Facebook and other companies "want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations," Trump added in his tweet, which came after Fed Chair Jerome Powell spent a good portion of his two days of congressional testimony responding to lawmakers' questions about Facebook and Libra.
4. LOCKHEED MARTIN: Earlier this week, President Trump tweeted that, "I was just informed by Marillyn Hewson, CEO of Lockheed Martin [LMT], of her decision to keep the Sikorsky Helicopter Plant in Coatesville, Pennsylvania, open and humming! We are very proud of Pennsylvania and the people who work there."
5. BOEING, RAYTHEON DEALS: In a joint statement on Tuesday following a meeting between President Trump and Qatari Emir Sheikh Tamim bin Hamad Al-Thani at the White House, the leaders said that, "We discussed our extensive and increasing economic partnership, including these mutually beneficial transactions: The Qatar Airways purchase of five Boeing [BA] 777 Freighters; The Qatar Airways commitment to purchase large-cabin aircraft from Gulfstream; The Chevron-Phillips Chemical Company [jointly owned by Chevron (CVX) and Philips 66 (PSX)] and Qatar Petroleum agreement to pursue the development, construction, and operation of a petrochemicals complex in Qatar; The Qatar Ministry of Defense's commitment to acquire Raytheon's [RTN] NASAM and Patriot Systems; The selection by Qatar Airways of GE [GE] jet engines and services to power its 787 and 777 Aircraft."
"Week in Review" is The Fly's weekly recap of its recurring series of "Trump Effect" exclusive stories.