Industry Shaken: Biotech Sector Faces Peril Amid Trump Administration Cuts

The biotech sector is under pressure due to Trump administration's budget cuts and grant freezes, affecting small and mid-cap companies. Mass layoffs at FDA have led to approval delays, while the financial downturn exacerbates challenges. Companies fear the impact on innovative drug development and investor confidence.

The biotech industry is facing turbulence as the Trump administration's budget cuts and directives take a toll on federal health agencies. Concerns are mounting over potential approval challenges for innovative treatments due to mass layoffs at the FDA, say investors and company executives.

Small to mid-cap biotech firms are hit hardest, with their innovative but yet-to-be-approved treatments left vulnerable. The freeze on grant funding from the National Institutes of Health (NIH) under executive orders has added to the sector's woes, risking the inflow of talent and resources.

The market reflects these anxieties, with the S&P Biotech ETF plummeting to an 18-month low. The impact of these changes is largely being felt in biotech circles where sentiment is grim, and clarity on recovery factors remains scarce, leaving companies in a perilous state.

(With inputs from agencies.)