There are two things President Donald Trump seems to enjoy about the stock market: watching it go up during his presidency, and sending down the shares of individual companies with his tweets or remarks.
A few hours after tweeting about the market’s gains since his November election, Trump was also talking about tanking health insurance stocks. He also sent drugmakers down Monday with comments about U.S. pharmaceutical prices.
“The U.S. has gained more than 5.2 trillion dollars in Stock Market Value since Election Day!” Trump tweeted Monday morning.
(Related: Math Geniuses Size Up 5 ACA Change Ideas)
Later in the day, Trump pointed out that insurers had benefited for years from Affordable Care Act subsidies he abruptly halted last week. The implication: The party’s over for their stocks.
“That was a subsidy for the insurance companies,” Trump said at a Monday cabinet meeting in Washington. “What they gave the insurance companies — take a look at their stocks. Take a look at where there stocks were when Obamacare was originally approved,” he said of the increase in health insurance shares since 2010.
Trump frequently tweets about the rise in the markets, or retweets accounts that show the same. The Standard and Poor’s 500 Index is up 36% since the 2016 election, a continuation of the almost decade-long rally that began in 2009 and has seen the gauge more than triple.
He made similar remarks about insurers in a tweet over the weekend.
“Health Insurance stocks, which have gone through the roof during the ObamaCare years, plunged yesterday after I ended their Dems windfall!” he tweeted.
Insurer and hospital shares dropped Friday after the Trump administration said it would end what are known as cost-sharing reduction subsidy payments, or CSRs. The subsidies — which go to issuers of Affordable Care Act public exchange plans to help lower-income people with co-pays and other cost-sharing — were “a total gift, Trump said. “You could almost call it a payoff, and it’s a disgrace.”
It’s not the first time he’s called out individual companies, including aerospace company Boeing Co. and online retailer Amazon.com Inc.
His comments Monday on pharmaceutical pricing likewise sent drug stocks down.
At the cabinet meeting, Trump said U.S. drug prices are “out of control” and that “the world is taking advantage of the United States.” Trump said he wants to bring U.S. drug prices — which are generally higher than in other countries — to parity.
“The same exact drug by the same exact company, made in the same exact box and sold someplace else, sometimes it’s a fraction of what we pay in this country,” Trump said. “Meaning, as usual, the world is taking advantage of the United States. They’re setting prices in other countries, and we’re not.”
Trump didn’t specify how he might force prices down, though did say doing so would be “a priority of mine.” At an impromptu press conference he held outside the White House later in the day with Senate Majority Leader Mitch McConnell, he also pointed to the drug industry’s political muscle.
“They contribute massive amounts of money to political people; Mitch, maybe even you,” Trump said.
Drug and health products manufacturers gave $597,573 to McConnell’s campaign committee for the 2011-2016 cycle, according to the Center for Responsive Politics, which tracks political giving. Trump’s 2016 campaign got $296,877 from the industry.
U.S. price reductions would be bad news for drugmakers. The country is the world’s biggest market for pharmaceuticals — and one of the most profitable. That’s partly because there are few checks on what drugmakers can charge other than what they can negotiate with buyers.
Following Trump’s remarks, the Nasdaq Biotechnology Index — a barometer of investor sentiment about the drug and biotech industry — pared earlier gains. The index was up 0.2% at 1:03 p.m. in New York, after rising as much as 1.6% earlier Monday.
—-Read 3 Weird Ways an ACA Subsidy Cut Could Help You on ThinkAdvisor.