Is Drug Pricing Backlash a Serious Risk for Big Pharma Stocks?

Drugs in the U.S. are estimated to cost around 56% more on average than in similarly industrialized countries, and Americans are fed up. With prices for life-saving medications rising consistently, it's no surprise that people are irate and desperate for change. But should investors fear that public backlash will harm the share prices of their healthcare investments? 

The sole way that backlash over drug prices would dent pharma stock prices is from policy change, whether it's through new laws or changes to the U.S. regulatory landscape. So far, political action to address rising drug prices has been scant, though congressional investigations into the causes of price hikes have been ongoing since at least 2015. At the end of September, the U.S. House of Representatives held hearings with testimonies from the CEOs of major pharmaceutical companies, including Bristol Myers Squibb (NYSE: BMY) and Amgen (NASDAQ: AMGN). Congressional researchers assembled a substantial set of reports that document how drug price increases were handled at each of the companies whose CEOs were scheduled to testify, and the findings were very illuminating.

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Source Fool.com