At a White House event on Friday, Pascal Soriot, AstraZeneca’s (AZN) chief executive, joined President Donald Trump to announce that the British pharmaceutical giant’s new pricing deal with the administration. The U.S. is AstraZeneca’s largest market in terms of sales revenue.
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Words about the deal had gotten out ahead of the announcement, but AZN stock ignored the update, ending Friday’s session 0.60% lower. The shares continued to decelerate on Monday, trending near the flat line around $84 per share during pre-market trading.
AstraZeneca is the second pharmaceutical company to enter this drug pricing arrangement with President Trump? So, what’s included in the discount deal, this time?
Americans to Get 80% Discount
As part of the arrangement, AstraZeneca said it will launch a direct-to-consumer platform that will supply medications for chronic diseases to Americans at an 80% discount. The company also plans to provide its drugs at prices obtainable in other developed countries.
The arrangement is in line with Trump’s demand that drug prices under Medicaid be sold at most favored nation (MFN) prices — or what is equal to or lower than prices in other developed countries. Trump had sent a letter to 17 major pharma firms earlier in July making the demand.
AstraZeneca to Join TrumpRx
The deal will also see AstraZeneca added to the TrumpRx platform that is set to go live early next year. The site is being prepared by the U.S. federal government to provide affordable drugs to Americans. Rival Pfizer (PFE), which is the first to enter such a drug pricing deal with Trump, also previously said it will make its discounted drugs available on the platform.
Furthermore, pharmaceutical company Amgen (AMGN) has stated plans to join the site. While Amgen has not entered any such pricing deal with Trump, the California-based company last week announced a 60% discount on its popular low-cholesterol drug, Repatha.
AstraZeneca to Invest $50B, Get 3-Year Exemption
Like Pfizer, AstraZeneca will also get a three-year grace period from Trump’s traiffs on the pharmaceutical industry. The latest of such tariffs is the 100% tariff on foreign branded medications announced by Trump late last month.
However, in return, AstraZeneca will ramp up its local drug production in the U.S. and commit more resources to research and development (R&D). Already, the company in July unveiled its plan to spend $50 billion for this purpose.
On Thursday, it kicked off the construction of its $4.5 billion facility–which the company said will be its biggest one worldwide–in Virginia. AstraZeneca plans to produce its weight management as well as metabolic disease medications at the plant. The facility will also host AstraZeneca’s targeted cancer therapy portfolio.
Building on these, AstraZeneca also plans to cut the ribbon on its expanded facility in Coppell, Texas, next week. It will also float a facility for cell therapy in Rockville, Maryland, in early 2026, and follow that up with a second major R&D center in Cambridge, Massachusetts, later next year.
Is AstraZeneca Stock a Buy or Sell?
Across Wall Street, AstraZeneca’s shares currently have a Strong Buy consensus rating, as seen on TipRanks. This is based on three Buy recommendations assigned by analysts over the past three months. Moreover, the average AZN price target of $92.33 suggests a 9% growth potential from the current level.
