We interrupt this summer's biotech stock rally for a statement from Hillary Clinton.
The Nasdaq Biotechnology Index fell 3.5% heading into Wednesday's close, with the loss triggered by a statement from Clinton's presidential campaign blasting Mylan (MYL) - Get Report for "outrageous" pricing of the EpiPen. Clinton's statement, issued shortly after 1 pm EDT, called on the company to "immediately reduce the price of EpiPens."
Clinton going after another pharmaceutical company for predatory pricing on Wednesday harkens back to her tweet last September when she called out Martin Shkreli and Turing Pharmaceuticals -- but also the drug and biotech industry more broadly -- for price gouging. That tweet caused a huge selloff of biotech stocks as investors feared government meddling into drug pricing -- and industry profits.
Lately, the political rhetoric against drug pricing during the presidential campaign seemed to be cooling off, leading to a rally in biotech stocks. The Nasdaq Biotechnology Index was up more than 20% since the end of June.
The 3.5% drop in the NBI Wednesday doesn't spell the end to the biotech stock rally, but the firestorm of media and political criticism targeting Mylan for the cost the EpiPen -- an autoinjector used to treat life-threatening allergic reactions -- isn't helping.
The list price of a package of two EpiPens costs more than $600 today, up from $94 about 10 years ago, according to Truven Health Analytics.
Members of Congress have called for an investigation into Mylan's EpiPen pricing practices and the American Medical Association, also Wednesday, called on the company to rein in the product's "exorbitant" cost.
Once again, biotech and pharma companies are getting called out for putting profits before patients. Mylan is the new Shkreli/Turing. Last September, this same criticism killed stock prices. Will the same thing happen one year after?
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.