With Donald Trump in the White House, the pharmaceutical sector could be set for a new era of mega-mergers, analysts have said.

The president-elect has pledged to cut corporation tax for American companies and suggested that he could allow businesses to repatriate money earned overseas back into the US without having to pay hefty fines.

“With the Republicans in control of the White House and both houses of Congress, the ability to adjust tax rates has increased significantly,” said Paul Cuddon, a healthcare analyst at Numis Securities.

“The reasons why mega mergers were hot over the last two years was partly because US companies wanted to make tax savings, but if US rates become more competitive internationally and pharma companies are able to bring money in from offshore, you could see a return to mega mergers as companies awash with cash look to boost their pipeline and save costs.”

Such policies would be a massive boon for the likes of Merck, Johnson & Johnson and Pfizer, which have tens of billions of dollars stashed overseas and are stuck paying high rates of corporation tax.