Price reduction agreement in exchange for a three-year tariff exemption period. Morgan Stanley gives Astrazeneca PLC Sponsored ADR (AZN.US) a "buy" rating.

Morgan Stanley stated that the announcement made by Astrazeneca PLC Sponsored ADR (AZN.US) and the US government regarding tariffs and drug pricing could bring relief and further improve industry sentiment. The bank has given Astrazeneca PLC Sponsored ADR a "hold" rating with a target price of 137 pounds. On October 10th, local time, US President Trump announced that his administration had reached an agreement with Astrazeneca PLC Sponsored ADR (AZN.US), which will significantly reduce prices for some drugs in exchange for tariff concessions. Tariffs and drug pricing have been ongoing issues in the industry this year, hindering ordinary investors from fully participating in the sector. With positive progress on the tariff issue and the drug pricing announcement made by Pfizer Inc. with the US government on September 30th aligning with Morgan Stanley's bullish outlook, the bank believes that the negative factors are starting to diminish. Astrazeneca PLC Sponsored ADR has announced a similar agreement to that of Pfizer Inc., indicating that the US government intends to support the fundamentals of the industry. While Astrazeneca PLC Sponsored ADR's stock price had initially benefited from Pfizer Inc.'s agreement (US analysis seen here), Morgan Stanley sees last week's announcement as another step towards improving industry sentiment. In conclusion, considering that European pharmaceutical stocks are still trading at a discount of low single-digit percentage points compared to the entire European market, similar announcements within the industry in the coming weeks/months may lead to the pharmaceutical sector regaining its "safe haven" status.