| With global markets crashing, drug company stocks would seem like a good place to stash money. But in President Donald Trump's new economy, that isn't turning out to be the case. "Remain sellers," Mizuho analyst Jared Holz said in a note to investors Sunday afternoon, in reference to big pharma stocks. "The government is not a friend." Things are looking better for health insurers like UnitedHealth and CVS that have Medicare Advantage plans. On Monday the Trump administration awarded then payment increases averaging 5.06% — more than twice what the Biden administration had proposed in January. Drug companies haven't fared as well in the Trump era. Things started optimistically. Before the inauguration, the chief executive officers of major drug companies like Pfizer, Merck and Eli Lilly were upbeat about the prospect of doing business under Trump. Lilly CEO Dave Ricks was hopeful the Trump administration would be open to revising the Inflation Reduction Act, a landmark Biden law that allows the government to negotiate the prices of older, widely used drugs. But the Trump administration has so far kept that program intact. In January during the waning days of the Biden administration, Lilly's key growth area of obesity drugs took a hit when the list of drugs facing Medicare price negotiations included obesity medication Wegovy from rival Novo Nordisk. That has the potential to drag down the prices of all weight-loss drugs. Ricks had also been pushing for the administration to finalize a Biden-era proposal to cover obesity drugs through Medicare. On Friday, the new Trump team scrapped that plan, sending Lilly's shares sharply lower. Ricks wasn't the only optimist at the beginning of the year. Pfizer CEO Albert Bourla had said the new Trump administration would bring "radical change." "There are several people that think for our industry, the risks outweigh the opportunities," Bourla said before the inauguration. "There are other people — among them, myself — who think that the opportunities outweigh the risks." But now tariffs are on the horizon for pharma. While Trump didn't include drugs in the levies announced last week, he did say that his administration is still looking into pharma tariffs. That's a sharp change from what the industry is used to. In 1994, the World Trade organization adopted an agreement that banned tariffs on a "large number of pharmaceutical products" and substances, so some drugmakers thought they'd be exempt. But no one knows what will happen now. There are "only a few hiding places from tariffs," according to a note from Leerink Partners analyst David Risinger. "We are most concerned about the near-term exposure of US-based pharmaceuticals to tariffs because immediate tariff hits could be very significant." Pharma's long enjoyed a dominant role in Washington. But the industry appears to be losing its edge with the new administration, which could continue to pressure companies' stocks in the months ahead. As Holz puts it, pharma's "'value' label is a misnomer." — Cynthia Koons and Madison Muller | 
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