Pharmaceuticals experienced a bump earlier in the year as the Trump administration rolled out plans to cut down drug prices. The administration has focused primarily on middlemen like pharmacy-benefit managers instead of manufacturers. The new policies have a more subtle affect on the overall industry as it may affect sales of certain blockbuster drugs but damage the share prices of smaller companies.
Overall, concerns of broad price controls, which dragged on the whole sector ahead of the 2016 elections, have more or less dissipated, and the upcoming midterm elections has not stirred up the pot either.
Given the low valuations, ongoing broad market support and diminished political risks, pharma stocks may continue to maintain their forward momentum.
For more information on the pharma sector, visit our pharmaceuticals category.