It would appear that Donald Trump is starting to win over the minds — though perhaps not the hearts — of the biopharma industry.
After we ran two earlier polls reflecting a deep distaste for the Republican, Trump’s upset victory followed by a surge in industry stocks was followed by a respectable show of support in our latest poll of biotech and pharmaceutical industry readers.
With 165 votes in, close to half (46%) felt that biopharma would be better off under Trump a year from now. That compares to 28% who felt it will be worse and 26% who felt that it will be no different on the anniversary of his win.
“I responded to an earlier survey you held by voting that Hilary would be better for biopharma than Trump, but my reasoning for that response was that Trump was just going to be a thin-skinned disaster as a president and that he would get us into a war or major crisis that would hurt the economy severely,” noted one reader. “Looking at Trump more closely, I think he’ll be more of a positive, at least short term.”
Another thumbs up, followed by a thumbs down: ”Less regulation and price controls. So, better because the industry will make more money and more research & advancements will happen. Worse, because when a few bad actors take advantage of this, there will be even bigger reputation hits for the industry. Think Shkreli with a bigger biotech.”
And don’t underestimate the underlying distaste many of our readers have for Trump.
Voting worse, a reader notes: “The stock market will go down once he’s in office. We will be in a period of instability. If his tax cuts go forward we will have another recession which will impact the ability to raise money.”
One reason for the change of positive sentiment can be seen in voters thoughts on the likely shift ahead in M&A. A clear majority of responders felt that Trump’s economic and tax policies would help spur greater M&A in the industry, which can help overall stock values.
Here are some comments favoring increased M&A, in which a number of readers highlighted the likelihood of tax reform:
“Particularly if the tax code changes to encourage companies with cash trapped outside the US to bring it back.”
“I assume he will negotiate a favorable pharma/biotech repatriation policy (hello Republican congress and senate!) for ex-US dollars which will fuel M&A.”
Here’s a note of caution:
“We don’t quite know what are his economic policies.”
The president-elect has clearly indicated that he wants to speed up the FDA and new drug approvals, but most readers aren’t expecting any kind of dramatic change soon. Two-thirds said they don’t expect a change in the next year. But 28% did believe the FDA will be prodded into acting more quickly.
The same proportion of people believe that the stock rally will inevitably flatten out, with the same number looking for a continuing bull market.
“There will be lots of rhetoric but overall no change, especially if the commissioner stays in place.”
“I expect some type of reform, and some divisions sure need to speed up, but others (oncology) already are moving at warp speed.”
“Subject to the selection of a transformational leader whom I cannot identify, the agency will chug along almost without regard to administration change. Four years is actually a pretty short time in FDA terms. Once the public learns that even “The Donald” can’t deliver (no Wall, no pmt from Mexico, little reform, few jobs), he may be turfed out with the same enthusiasm with which he was elected. “
Finally, a significant minority of 43% said they expect foreign-born scientists will start leaving the US after Trump takes office. Slightly more than half said they expect things will stay the same on that score. And you could hear a common theme among many of the comments we received. Trump, many believe, can’t be as bad as he made himself out to be.
“As long as Trump is not a complete idiot – I suspect he does not really intend to do a lot of the things he said during the campaign.”
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