LONDON — Changes in U.S. Vaccine Policy
Recent policy shifts in the U.S. under Health Secretary Robert F. Kennedy Jr. have significantly impacted vaccine manufacturers, as what began as anti-vaccine rhetoric has now led to fundamental changes in vaccination schedules and guidelines, according to investors and industry executives.
Over the past year, President Donald Trump’s administration has drastically altered vaccine protocols, including a notable decision last month to eliminate long-standing recommendations for children to receive vaccinations against flu, hepatitis A, and other diseases.
This series of unprecedented modifications has resulted in a decline in vaccine usage, affected investment prospects for various biotech firms, and is expected to influence revenues and increase costs for companies in the future, as reported by 15 investors and analysts to Reuters.
“Vaccines will not be a growth area under the current administration,” remarked Stephen Farrelly, global pharmaceutical and healthcare lead at ING, hinting at a prolonged downturn for the sector through 2028.
Kennedy’s Influence
Kennedy, known for his longstanding opposition to vaccines and for expressing doubts about their safety and effectiveness despite scientific consensus, has quickly enacted significant changes since taking the helm of the Department of Health and Human Services.
He dismissed a panel of independent expert advisers and replaced them with individuals who share his skepticism towards vaccines, withdrawing broad COVID-19 vaccine recommendations for pregnant women and children.
He also brought back research on the long-debunked notion linking vaccines to autism while unrolling revised childhood vaccine schedules without the collaboration of a widely representative group of external experts.
Initially, investors viewed Kennedy’s installation as more of a public relations risk than an existential threat.
At that time, other issues like tariffs and drug pricing pressures from the Trump administration were overshadowing vaccine concerns, leading them to take a backseat.
However, as the implications of Kennedy’s policies became more tangible, investors began to worry about the long-term impact, voicing fears similar to those of public health experts regarding the potential increase in preventable diseases and fatalities.
Kennedy argues that his modifications are intended to enhance safety and align U.S. vaccine policy with that of other countries.
A spokesperson for HHS stated that vaccine recommendations are grounded in the best available scientific evidence and public health factors rather than corporate interests.
Major vaccine manufacturers include UK-based GSK, France’s Sanofi, U.S. firms Pfizer and Merck, as well as smaller companies like Moderna, Novavax, and Germany’s BioNTech.
The drastic policy adjustments have led to rare public criticism from industry leaders.
At a significant healthcare conference last week, Pfizer CEO Albert Bourla and Sanofi CEO Paul Hudson spoke out against Kennedy’s statements, with Hudson referencing “misinformation” prevalent in public discourse.
Bourla expressed his frustration, noting that the current narrative was affecting vaccination rates and increasing the risk of disease. “What’s happening has no scientific basis and serves primarily a political and anti-vax agenda,” he said.
Political Ramifications
Despite the rocky road ahead, many investors maintain that the long-term outlook for vaccine manufacturers remains strong, given that vaccines are still the most effective prevention method against diseases. However, they feel companies are now more susceptible to the whims of political leaders.
“Unfortunately, success and failure now rest on a few individuals’ opinions. It’s not just about good science and market opportunity,” noted Clear Street analyst Bill Maughan. “For biotech investors, having confidence in vaccine firms is challenging at the moment.”
Investors indicated a preference for larger pharmaceutical companies less reliant on vaccine revenues, like GSK, Sanofi, Pfizer, and Merck, while smaller companies like Moderna, BioNTech, and Novavax face heightened risks.
The effects of these changes are becoming evident. For instance, GSK and Sanofi reported declines in U.S. flu vaccine sales in the third quarter, even amid a more severe flu season.
Additionally, in October, Australia’s CSL postponed its plans to separate its vaccine division, Seqirus, citing increased volatility and declining vaccination rates in the U.S.
“Clearly, there’s a consumer response to the narrative emerging from the U.S.,” commented Jefferies analyst Michael Leuchten.
Future Outlook
Some investors remain optimistic that demand for vaccines will eventually bounce back. With outbreaks like increased measles cases in South Carolina and an ongoing severe flu season, they believe renewed interest in vaccinations is possible.
The Centers for Disease Control and Prevention recently reported at least 11 million flu cases and 5,000 deaths for the 2025–26 season, nearly double from the previous year.
Medical organizations, including the American Academy of Pediatrics, are challenging Kennedy’s policies through legal measures, and it remains unclear how this will unfold.
Investors tend to focus on shorter time frames, while companies typically adopt a longer-range perspective, observed Linden Thomson, a senior portfolio manager at Candriam asset management.
“These businesses have endured for decades. They don’t invest with only a one- or two-year outlook,” added Matthew Masucci, an analyst at Callodine Capital, which holds shares in GSK and Sanofi.
However, for the time being, investor caution seems to be the prevailing sentiment.
Instability in U.S. policy and prevailing vaccine skepticism are creating headwinds for investment, according to equity analyst Ian Turnbull at Mawer. “The market is less appealing for investment when demand is no longer as predictable as it once was,” he concluded.
