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Teva Pharmaceuticals is a leading generic drug manufacturer. Photo: Uriel Sinai/Getty Images

Monday was a rough day for pharmaceutical companies on Wall Street. The SPDR S&P Pharmaceuticals ETF fell more than 4%, and that was a relief.

Driving the news: Generic drugmakers were hit by a price-fixing lawsuit filed by 44 states alleging 20 corporate defendants conspired to fix prices of more than 100 generic drugs, raising prices by more than 1,000%.

  • Teva Pharmaceuticals shares fell more than 15%, with Mylan off 9%, and Endo International opening 10% lower after a downgrade by JPMorgan analysts, and then falling another 10% during the day. (Endo was already reeling from news it reported a wave of over 20,000 fatalities related to its drugs to the FDA.)

Why it matters: Health care stocks overall have had a terrible 2019 and it may just be beginning. A verdict or settlement in the lawsuit is likely years away, but the new spotlight the case puts on drug makers "spells trouble for investors," writes WSJ's Charley Grant, as the Trump administration looks to further dismantle the Affordable Care Act and take on high drug prices.

  • "The ACA is an ideal framework to make money: It maximizes access to health services without meaningful cost-control tools. The sector, which trails the S&P 500 this year, will suffer more if the risk of disruption increases."

The bottom line: Grant notes that lower drug prices are bad for every element of the health care sector. "Members of the supply chain, such as drug distributors, pharmacies and benefits managers, are generally paid for their services as a percentage of a drug's list price."

Go deeper: Wall Street is still freaking out over health care stocks

Go deeper

Updated 3 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Health: Most vulnerable Americans aren't getting enough vaccine information — Fauci says Trump administration's lack of facts on COVID "very likely" cost lives.
  2. Education: Schools face an uphill battle to reopen during the pandemic.
  3. Vaccine: Florida requiring proof of residency to get vaccine — CDC extends interval between vaccine doses for exceptional cases.
  4. World: Hong Kong puts tens of thousands on lockdown as cases surge — Pfizer to supply 40 million vaccine doses to lower-income countries — Brazil begins distributing AstraZeneca vaccine.
  5. Sports: 2021 Tokyo Olympics hang in the balance.
  6. 🎧 Podcast: Carbon Health's CEO on unsticking the vaccine bottleneck.

DOJ: Capitol rioter threatened to "assassinate" Alexandria Ocasio-Cortez

Supporters of former President Trump storm the U.S. Captiol on Jan. 6. Photo: Kent Nishimura / Los Angeles Times via Getty Images

A Texas man who has been charged with storming the U.S. Capitol in the deadly Jan. 6 siege posted death threats against Rep. Alexandria Ocasio-Cortez (D-N.Y.), the Department of Justice said.

The big picture: Garret Miller faces five charges in connection to the riot by supporters of former President Trump, including violent entry and disorderly conduct on Capitol grounds and making threats. According to court documents, Miller posted violent threats online the day of the siege, including tweeting “Assassinate AOC.”

Schumer calls for IG probe into alleged plan by Trump, DOJ lawyer to oust acting AG

Jeffrey Clark speaks next to Deputy US Attorney General Jeffrey Rosen at a news conference in October. Photo: Yuri Gripas/AFP via Getty Images.

Senate Majority Leader Chuck Schumer (D-N.Y.) on Saturday called for the Justice Department inspector general to investigate an alleged plan by former President Trump and a DOJ lawyer to remove the acting attorney general and replace him with someone more willing to investigate unfounded claims of election fraud.

Driving the news: The New York Times first reported Friday that the lawyer, Jeffrey Clark, allegedly devised "ways to cast doubt on the election results and to bolster Mr. Trump’s continuing legal battles and the pressure on Georgia politicians. Because Mr. [Jeffrey] Rosen had refused the president’s entreaties to carry out those plans, Mr. Trump was about to decide whether to fire Mr. Rosen and replace him with Mr. Clark."