What Happened?
A number of stocks jumped in the afternoon session after reports revealed a potential drug-pricing agreement between the White House and the pharmaceutical industry.
The Trump administration is advancing its “Most Favored Nation” initiative, which aims to lower prescription drug costs for Americans. This policy would tie the prices of medications in the U.S. to the lowest costs paid by other wealthy nations. As part of this push, Pfizer has reportedly entered into an agreement to voluntarily sell its medications through Medicaid at these reduced prices. The move comes as the administration intensifies pressure on drugmakers to make prices more affordable. While pricing controls can often be a headwind, the market's positive reaction suggests that investors may see this voluntary agreement as a way to resolve regulatory uncertainty, providing a clearer path forward for the industry.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Drug Development Inputs & Services company Repligen (NASDAQ: RGEN) jumped 6.6%. Is now the time to buy Repligen? Access our full analysis report here, it’s free.
- Senior Health, Home Health & Hospice company BrightSpring Health Services (NASDAQ: BTSG) jumped 4.1%. Is now the time to buy BrightSpring Health Services? Access our full analysis report here, it’s free.
- Research Tools & Consumables company Danaher (NYSE: DHR) jumped 5.9%. Is now the time to buy Danaher? Access our full analysis report here, it’s free.
- Research Tools & Consumables company Thermo Fisher (NYSE: TMO) jumped 4.8%. Is now the time to buy Thermo Fisher? Access our full analysis report here, it’s free.
- Therapeutics company Amgen (NASDAQ: AMGN) jumped 3.8%. Is now the time to buy Amgen? Access our full analysis report here, it’s free.
Zooming In On Repligen (RGEN)
Repligen’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 14 days ago when the stock gained 4.4% on the news that investment firm Stifel reiterated its Buy rating and maintained a $207 price target on the stock.
The firm's positive stance is based on customer research into bioprocessing trends, which revealed "good momentum & differentiation and modest competitive risk" for Repligen's important ATF (alternating tangential flow) technology. Stifel's analysis suggests this should continue to drive growth for the company. The broader market sentiment also appears favorable, with the single-use downstream bioprocessing market, where Repligen is a key player, valued at $6 billion in 2024 and projected to reach $14 billion by 2034. This growth is driven by advances in monoclonal antibodies, biosimilars, and vaccine production.
Repligen is down 6.6% since the beginning of the year, and at $133.67 per share, it is trading 23.3% below its 52-week high of $174.24 from January 2025. Investors who bought $1,000 worth of Repligen’s shares 5 years ago would now be looking at an investment worth $905.99.
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