Wall Street analysts are closely watching Eli Lilly and AstraZeneca as the most likely candidates to follow Pfizer's lead in striking drug pricing deals with the Trump administration, according to a Reuters survey of seven healthcare analysts and investors.
Four analysts identified Lilly as the next potential dealmaker, while three pointed to AstraZeneca. Other companies mentioned include Merck, AbbVie, Regeneron, and Bristol-Myers Squibb, though Reuters could not independently confirm any deals were in development.
Market Response and Strategic Positioning
The pharmaceutical sector has responded positively to Pfizer's September 29 agreement, which pledged lower prices via Medicaid in exchange for relief on tariffs for imported medicines. Eli Lilly emerged as the biggest gainer in pharma sector shares following the Pfizer deal, with AstraZeneca ranking second. Denmark's Novo Nordisk, Pfizer itself, and Novartis have lagged behind.
Lucy Coutts, a UK-based investment director at wealth manager JM Finn, predicted AstraZeneca could be next in line, citing the company's recent groundbreaking on a $4.5 billion plant in Virginia and plans for a U.S. stock exchange listing. "I'd like to think it will be AstraZeneca given revenues from U.S., its investment in manufacturing and R&D in the US and implementing a dual listing on NYSE," she said.
Manufacturing Investments Signal Commitment
Both companies have demonstrated significant commitment to U.S. operations through major manufacturing investments. Eli Lilly announced last month it will invest $5 billion to build a manufacturing facility in Virginia, part of a broader $27 billion U.S. expansion over the next five years. AstraZeneca recently broke ground on its $4.5 billion Virginia plant.
Several other pharmaceutical giants, including Pfizer, Novartis, and Johnson & Johnson, have also announced U.S. investments this year as companies position themselves favorably with the administration.
Government Outreach Intensifies
The Trump administration is actively pursuing deals across as many as 30 industries, including pharmaceuticals, according to Reuters reporting. Two sources revealed that pharmaceutical executives are receiving near-daily calls from senior government officials as negotiations intensify.
Gareth Powell, head of healthcare at London-based investment fund Polar Capital, suggested an announcement from Lilly could be imminent, followed by AstraZeneca. Powell noted Trump's apparent close relationships with the chief executive officers of Lilly, Pfizer, and Regeneron, all U.S. firms.
Presidential Pressure Campaign
Both Lilly and AstraZeneca were among 17 leading drug companies that received letters from Trump in July demanding they slash prices to match those paid overseas. Powell observed a telling detail in Trump's approach: "If you notice those 17 letters that he sent to pharma, he crossed out the typed up names for Lilly, Pfizer and Regeneron, and wrote it in pen their names in a sort of more friendly manner."
Company Responses
When contacted by Reuters, Lilly stated it did not have specific details to share about its discussions with the administration at this time. AstraZeneca did not immediately respond to requests for comment.
The pharmaceutical industry continues to navigate the complex landscape of Trump administration policies, with companies balancing the need to maintain favorable relationships while managing potential tariff threats and pricing pressures.
