In this video from Motley Fool Live, recorded on Jan. 25, Corinne Cardina, bureau chief of healthcare and cannabis, and Fool.com contributor Brian Orelli discuss how the executive orders from President Joe Biden will affect healthcare investors. One of the executive orders could be a boon to COVID-19 testing companies, while the decision on the next commissioner of the Food and Drug Administration (FDA) could have an effect on the entire industry.
Corinne Cardina: What else do we know about President Biden's strategy to deal with the pandemic? Of course, he is going to be working hard with Congress to advance a significant legislative solution. But in the meantime, he has signed a lot of executive orders. Are there any that are relevant to healthcare investors?
Brian Orelli: I don't think this is an executive order, but Janet Woodcock is going to be the acting FDA director. She's been at the agency for decades. She's a career person. She's never held the FDA director position full-time and it's not quite clear where she's going to be the full-time FDA director, but she's definitely been a friend to the industry. I'm not necessarily a pushover, but somebody who wants to work with companies to get drugs approved -- so sort of a unified goal. She's probably most famous for stepping in and overriding the lower level FDA officials on the Sarepta Therapeutics (SRPT 3.52%), their first Duchenne's muscular dystrophy drug.
Biden is stopping the exit from the World Health Organization, WHO. I don't know how much of an effect that's going to have on companies. It's probably indirect, maybe better access to data that WHO generates, especially for surveillance during the next pandemic.
He's going to work on healthcare supplies, ramping up healthcare supplies through the Defense Production Act. There's potential for companies to get contracts there. But if you believe in capitalism, companies would already be doing this if there was a market for them to make money, so while they might get contracts, the margins might not be very high if they're forced to do it through the Defense Production Act.
Then he's going to work on a federal board to increase testing efforts that could definitely benefit test makers like Quidel (QDEL 0.62%) and Fulgent Genetics (FLGT 2.78%). It could also help the companies that run the tests, I'm thinking of Laboratory Corp. of America (LH 1.11%) and Quest Diagnostics (DGX 0.44%).