Key Takeaways

Shares of several major pharmaceutical companies slumped Wednesday morning as President Donald Trump threatened tariffs on the industry.

Speaking at a Tuesday event hosted by the National Republican Congressional Committee, Trump said his administration will "be announcing very shortly a major tariff on pharmaceuticals" in an attempt to force companies to shift manufacturing to the U.S.

"We're going to tariff our pharmaceuticals, and once we do that they're going to come rushing back into our country because we're the big market," Trump said Tuesday. "The advantage we have over everybody is that we're the big market. So we're going to be announcing very shortly a major tariff on pharmaceuticals, and when they hear that, they will leave China, they will leave other places because they have to sell, most of their product is sold here."

Shares of AstraZeneca ( AZN ), Pfizer ( PFE ), Eli Lilly ( LLY ), Novo Nordisk ( NVO ), Johnson & Johnson ( JNJ ), GSK ( GSK ), and Sanofi ( SNY ) all declined Wednesday morning.

Pharmaceuticals were one sector exempted from the wide-ranging tariffs announced last week , along with semiconductors.

Trump has cited a desire to motivate companies to shift manufacturing back to the United States. Experts have said the rise in prices and potential recession could cause many jobs to be lost before those potential manufacturing job gains are realized, however.

Read the original article on Investopedia