Is Now the Time to Ditch Pharma Stocks?
The U.S. is truly a marvel when it comes to inventing new medicines. Despite being home to just 4% of the global population, the nation accounted for over 50% of new chemical entities and biologics developed over the past 20 years.
This may in part be due to a relative lack of drug price regulations. Unlike many other health agencies, the U.S. Food and Drug Administration (FDA) does not have the authority to set drug prices. The greater profit incentive spurs innovation.
But the regulatory environment could soon change. As vital as healthcare breakthroughs are, they often come at an enormous expense for patients. In fact, Americans pay between 50% and 750% more for the same drug as their Japanese, European, or Canadian counterparts. With a likely crackdown on drug manufacturers' power looming, let's look at why now could be a good time to ditch certain pure-play pharma stocks.
Source Fool.com
