A shock to the market
Wall Street does not always flinch when politicians talk, but Monday was different. Shares of Kenvue—Tylenol’s parent company—dropped more than 5% after President Donald Trump mentioned that acetaminophen could be connected to autism. The drop is just the latest in a rough stretch for the drugmaker, with shares already down 25% in the last six months.
Investors are spooked, and rightly so: Trump promised “one of the biggest medical announcements in the history of our country” that would reveal secrets about what is causing autism. As one of the most reliable painkillers available, even a hint of scandal sends markets reeling.
An old controversy
This is not the first time that acetaminophen has been drawn into a health scare. Over the years, there have been lawsuits alleging that Tylenol use during pregnancy might heighten the risk of ADHD or autism. Most of those cases stalled in court after judges ruled the science was not strong enough to prove a cause-and-effect link.
Still, the idea will not perish. Robert F. Kennedy Jr., now the head of the Department of Health and Human Services, has been a vocal supporter of theories connecting acetaminophen, vaccines, and environmental toxins with autism. Scientists, for their part, reject those claims, pointing to a 2024 sibling-comparison study that found no meaningful link between Tylenol use during pregnancy and autism.
The science says otherwise
Health experts are sounding the alarm—not on Tylenol, but on the messaging. Acetaminophen has been among the safest options for pain relief in pregnancy for decades. A representative of Kenvue reaffirmed this, saying, “Independent, sound science clearly shows that taking acetaminophen does not cause autism.”
Researchers also caution against assuming that autism rates are “skyrocketing”. Harvard professor Ari Ne’eman explains how higher diagnoses are due to more awareness and broader definitions—not a sudden jump in incidence. In other words, autism may seem more common today simply because doctors are now better at diagnosing it.
Why investors care so much
Tylenol is a big business for Kenvue. Although the company doesn’t break out sales of the brand, analysts estimate it generates around 10% of revenue. That makes it one of the company’s crown jewels—and a lightning rod for bad publicity as well.
In spite of this, history suggests Kenvue might weather this storm. Previous lawsuits and horror stories failed to make a long-term impact on Tylenol’s market share. As one BNP Paribas analyst is quoted, “Despite the litigation, we haven’t seen an impact on Tylenol consumption and market share, and they continue to do well.”
What comes next
The big question now is the content of Trump’s promised announcement. If it’s merely rhetoric, Wall Street may ignore it. But if the administration pushes warnings or consumer-facing messaging, consumers may think twice before they reach for Tylenol—and that’s when Kenvue may knock for real.
For now, lawsuits make their way through appeals, and investors are bracing for more headlines. But absent new, solid science, analysts expect Tylenol sales to hold up, even if the stock fluctuates in the short term.
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