Market report: Hikma falls on US price-fixing probe

Dive: Hikma was the FTSE 100's worst performer

Toby Melville/Reuters

Jamie Nimmo4 November 2016

Investors feared today that drugmaker Hikma Pharmaceuticals will be dragged into the US price-fixing probe, leaving its shares in need of medical attention.

Hikma, which is based in Jordan, quoted in London, but does most business stateside, slumped 164p, or 9.4%, to 1581p on reports the Department of Justice is close to ending its two-year investigation into whether generic drugs firms colluded to fix prices.

On Wall Street, two of the companies which could face criminal charges, Teva and Mylan, slumped 10% and 7% respectively yesterday afternoon when the news broke.

Hikma has not been named as one of the companies underscrutiny, but HSBC today fuelled concerns it will be sucked into the investigation.

The bank said that although it may not yet be involved in the probe, all generic drugmakers could be seen as guilty by association until proved otherwise.

Investors rushed for the exit at Hikma as soon as the market opened.

Around two-thirds of the average daily trading volumes for the past month changed hands in the first 10 minutes of today’s session.

Shares in Shire, which makes the generic ADHD drug Adderall, also suffered, falling 129p, or 2.8%, to 4410p.

The scale of Hikma’s decline was exacerbated by a wider market sell-off as the FTSE 100 fell 73.28 points, or 1.1%, to 6717.23, making it a clean sweep for London’s blue-chips which ended every day this week in the red.

Oil’s continued slide — down at $46 a barrel — and little appetite for bold bets before Tuesday’s US election were behind trading screens flashing red.

Lloyds Banking Group, down just 0.26p at 55.77p, avoided the brunt of the sell-off after an upgrade to Overweight from JPMorgan Cazenove, which expects the bank to sail through the stress tests — the results of which are due at the end of the month.