By Alun John and Danilo Masoni
LONDON (Reuters) -European healthcare stocks jumped on Wednesday, mirroring moves in the United States, a day after Pfizer and President Donald Trump agreed to lower prescription drug prices in the Medicaid programme in exchange for tariff relief.
Healthcare stocks on both sides of the Atlantic have been lagging this year due to uncertainty about the Trump administration’s stance on drug pricing and the impact of tariffs.
U.S. patients currently pay far more for prescription medicines, often nearly three times more than in other developed nations, and Trump has been pressuring drugmakers to lower their prices to what patients pay elsewhere.
Analysts and investors said the deal, and expectations that more will follow, had reduced uncertainty for the sector around the world.
Analysts at JPMorgan said the deal was “a potential bellwether for the sector which, we anticipate is likely to be replicated by EU pharma companies.”
Pfizer is the first drugmaker to announce a deal. Trump sent letters to 17 leading drug companies in July telling them to slash prices to match those paid overseas. He asked them to respond with binding commitments by September 29.
Europe’s healthcare sector index rose 2.8%, which if sustained would be its biggest daily percentage gain since April. The index is down 2.9% so far this year.
Pharmaceutical companies and their suppliers – many of which have business in the United States – surged, topping Europe’s STOXX 600 index.
Ambu rose 10%, Sartorius 7.4%, and Merck, Roche and AstraZeneca all climbed around 5%. Novo Nordisk and Novartis gained 3.7% and 2.3%, respectively.
Pfizer shares rose 7% on Tuesday, and other U.S. pharma stocks also gained.
“2025 was expected to be the year of renewed expansion (for the pharmaceutical sector), but then tariffs were introduced,” said Angelo Meda, head of equities at Banor SIM in Milan.
“So, any positive news on that front can breathe new life into a sector that is currently trading at relative lows compared to the broader market,” he said.
Banor SIM is currently overweight healthcare stocks.
(Reporting by Alun John in London and Danilo Masoni in Milan. Editing by Amanda Cooper, Mark Potter and Ros Russell)
