Asia's pharma stocks drop as US plans drug price cuts

Shares of Asian pharmaceutical companies fell after US President Donald Trump said he planned to order a cut in US prescription drug costs to bring them in-line with other countries.

- ALICE FRENCH ΚΑΝΟΚΟ MATSUYAMA

Drugmakers were the worst-performing sector in Japan yesterday, weighing on the benchmark Topix despite optimism for a US-China trade deal broadly boosting markets across the region. Chugai Pharmaceutical Co dropped as much as 7.2%, the most in a month, with peers Daiichi Sankyo Co and Takeda Pharmaceutical Co losing around 5%.

Meanwhile in South Korea, SK Biopharmaceuticals Co, Celltrion Inc and Samsung Biologics Co all fell over 3%. In Hong Kong, BeiGene Ltd tumbled as much more than 5% and Innovent Biologics Inc dropped 3.7%.

The declines come after Trump said on social media he intends to sign an executive order lowering the price of prescription medicines at 9 am (8 pm in Thailand) yesterday in Washington, after reports emerged of the plan last week. The announcement is pressuring drug-related stocks, on worries their profits will take a hit if they have to reduce prices in the US.