Prominent pharmaceutical company Gilead Sciences (GILD -2.76%) wasn't prominent in the minds of investors on Monday. Following media reports that a key federal agency was contemplating a move that might affect its business, the market collectively sold out of Gilead's stock to leave it with an almost 3% loss on the day. That decline was in contrast to the S&P 500's (^GSPC 0.02%) slight (0.02%) rise.
Preventing prevention?
Those reports derived from a Wall Street Journal article published last Friday evening. Citing unidentified "people familiar with the matter," the financial newspaper wrote that Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. aims to dismiss all current members of the U.S. Preventive Services Task Force (USPSTF), a panel that advises HHS on such healthcare products.
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According to the article's sources, Kennedy believes the 16 members of the panel are too "woke." The panel has been a key advisory body for HHS since its formation in 1984. Under the Affordable Care Act (also known as "Obamacare"), it has been entrusted to determine which screenings, drugs, and other goods/services must be provided at no cost to patients by insurers.
Such a move could threaten the considerable preventive goods portfolio of Gilead, which offers a range of drugs in the segment, including popular human immunodeficiency virus (HIV) prevention treatments Yeztugo and Descovy.
The effect of potential panel changes
When contacted by the Journal, an unnamed spokeswoman for Kennedy only said that he "looks forward to working with the USPSTF to improve public health."
Gilead has not yet commented on the article, but we can be sure that the company will be following developments as they occur. And while it's too early to reasonably gauge what impact the potential dissolution of the panel might have on its business, it's certain to feel the impact to some extent.
