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Stock Strategist Industry Reports

What a Biden Presidency Could Mean for Drug Pricing

Reforms are likely to be moderate, and we don’t expect significant changes in 2020.

We think Joe Biden’s moderate position and nomination as the Democratic presidential candidate reduces the likelihood of significant drug pricing policy changes, in spite of more-aggressive reform recommendations from the Biden-Sanders unity task force. This forecast comes amid uncertainty around the bigger-picture healthcare issue, as the future of the Affordable Care Act is being debated at the U.S. Supreme Court level.

The low probability of drug pricing policy changes also reduces the likelihood of a major policy-related impact on drug innovation. We see a less than 10% probability of a "Medicare for All" system within the next decade, and we don’t include it in our analysis. Such a system would reduce U.S. drug prices with the negotiating power of a one-payer system, but odds are likely even longer now that U.S. Sen. Bernie Sanders is no longer in the running for the Democratic nomination.