Investing.com — RBC Capital said the potential departure of Health and Human Services Secretary Robert F. Kennedy Jr. could have wide-ranging implications for the biotech sector, with both winners and losers across therapeutic areas.
“RFK Jr.’s departure would likely have some overall positives for the biotech sector, though a few more mixed implications,” analysts at RBC Capital wrote.
The note follows escalating criticism of Kennedy’s controversial stance on childhood vaccines, with the bank highlighting that “>1,000 current and former HHS affiliates” have called for his resignation and bipartisan scrutiny at a Senate Finance Committee hearing.
According to RBC, vaccine makers such as Moderna, HIV prevention leader Gilead, and neuropsychiatric companies like Axsome, Biohaven, and Alkermes would likely benefit.
His departure “may reduce the risk of reorganization and/or layoffs at the FDA, and may also signal a potential reversal of some of his policies—such as the exclusion of experts from advisory panels due to conflicts of interest,” wrote RBC.
However, the outlook is less positive for CAR-T and antiviral companies, which could face increased policy scrutiny.
RBC warned that a replacement could “have greater focus on drug approval and pricing scrutiny,” which might offset some of the sector’s relief.
The analysts also highlighted broader implications, including potential boosts to federal research funding through agencies such as the CDC, NIH, and NSF.
They noted that after Kennedy’s nomination, the XBI biotech index “was down 8% over the next 2 days, highlighting concern among biotech investors.”
“Healthcare overall, including biotech, could be viewed as less unpredictable, and as such more investable, should RFK, Jr. depart his position,” RBC concluded.
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