GSK, AstraZeneca slide after FDA unveils new vaccine lead

(Sharecast News) - Shares in GSK and AstraZeneca came under pressure on Wednesday, after vaccine-sceptic Vinay Prasad was appointed to a key role at the US Food and Drug Administration. Prasad, an oncologist who has been vocal in his criticism of the FDA's leadership as well as Covid-19 mandates, was named director of the regulator's Center for Biologics Evaluation and Research on Tuesday.

He will oversee the regulation of costly biologic drugs, including vaccines, gene therapies and blood supply, and is widely expected to tighten up vaccine approvals, likely leading to much longer approval timelines for new drugs.

Biotech companies fell sharply on the news. On Wall Street, Moderna closed down 12%, BioNTech was off 6%, Pfizer lost 4% and Eli Lilly & Co ended the session 6% weaker, and UK firms came under similar pressure on Wednesday.

As at 1100 BST, AstraZeneca - the FTSE 100's biggest stock - was trading 2% lower at 10,503.36p, while fellow blue chip GSK was 4% softer at 1,390.0p.

Also weighing on the sector was Novo Nordisk, the maker of Ozempic and Wegovy. The Danish firm cut annual sales and profit forecasts for its blockbuster obesity and diabetes medicines on the back of compounding, which are medications made by pharmacies using the active ingredients of patented drugs.

Russ Mould, investment director at AJ Bell, said: "Suggestions the US could be set to impose tariffs on pharmaceuticals in the next fortnight, the appointment of vaccine-sceptic Prasad to the FDA and a warning from leading player Novo Nordisk has heaped pressure on GSK and AstraZeneca."