Health stocks hit after Trump taps RFK for top job

Shares in vaccine makers and healthcare firms around the world slid sharply on Friday, as investors warned that Donald Trump's choice of Robert F Kennedy Jr as US Health Secretary could pose new challenges to the sector.

Kennedy is known as a vaccine sceptic and, if confirmed in the post, has vowed to use it to crack down on “Big Pharma”.

The news prompted a sell-off across the industry. In the US, shares in Pfizer and Moderna sank more than 5% in early trading, while UK-listed firms AstraZeneca and GSK dropped 2% or more.

Russ Mould, investment director at AJ Bell, said the pick had “spooked” shareholders, despite questions about how the new administration might pursue its threats.

“The impact on the sector is hard to judge fully at this stage but, at the very least, it will cause a good deal of uncertainty,” he said.

The US health secretary leads a huge agency overseeing everything from food safety to medical research and welfare programmes.

Critics of Kennedy, commonly known by his initials RFK Jr, include many public health officials, who have denounced his record of spreading health information that scientists say is false.

But the former environmental lawyer has gained a following by tapping into mistrust of those who see US regulators as too deferential to big food and medical companies.

Before endorsing Trump, Kennedy had mounted a failed bid for the presidency himself as a third party candidate. That campaign spotlighted calls for increased restrictions on food chemicals and dyes, cutting ultra-processed foods from school lunches and forcing drug companies to share more information about vaccines.

If his nomination is ratified by the Senate and he is empowered to act on his pledges, it would mark a change in approach, not only from the Biden administration but from Trump's first term, which saw the government pour money into helping firms develop Covid vaccines, while taking a hands-off approach to regulation.

However, Trump also drew alarm in the industry with efforts to lower drug prices, including by making it easier to import medicine from Canada.

In opening trade on Friday, shares in Pfizer and Moderna tumbled more than 5%, accelerating their slide after dropping about 2% on Thursday.

In Europe, Danish-listed shares of Ozempic-maker Novo Nordisk were on track to close more than 4% lower, while France's Sanofi, a leader in flu vaccines, saw its shares in Paris slide more than 3%.

In London, shares in GSK slid about 4% and AstraZeneca fell roughly 2.6%.

Asked for comment about the pick, Steve Ubl, head of the US trade association for pharmaceutical manufacturers, defended the industry, noting its success fighting disease such as polio and smallpox and its major role in the economy.

"We want to work with the Trump administration to further strengthen our innovation ecosystem and improve healthcare for patients," he said in a statement, without mentioning Kennedy by name.

He called on policymakers to focus on addressing chronic disease with prevention and reforming America's complicated health system to make medicine more affordable.