(Reuters) - Shares of U.S. pharmaceutical and biotechnology companies fell on Tuesday after President Donald Trump said he was working on a “new system” to reduce prices in the industry, without providing details of his plan.

Trump’s comments came as he backed a Republican bill to repeal and replace the Affordable Care Act, known as Obamacare.

“I am working on a new system where there will be competition in the Drug Industry,” Trump tweeted. “Pricing for the American people will come way down!”

Pharmaceutical and biotech shares fell broadly after Trump’s tweet, but had pared back steeper initial losses by afternoon trading.

Shares of Pfizer Inc PFE.N and Merck & Co MRK.N were down about 0.5 percent, while Eli Lilly & Co LLY.N dropped 1.1 percent.

The Nasdaq Biotechnology index .NBI was 0.8 percent lower, pausing momentum for the index, which has climbed about 12 percent this year after a brutal 2016.

“I’m skeptical about what it is that he might do that would actually have a material impact on drug prices,” said Paul Heldman, managing partner at Heldman Simpson Partners, which follows healthcare issues for institutional investors out of Washington.

“I wouldn’t rule it out, but I’m just not there yet that he has some sort of broad plan that has a big impact in the marketplace that will actually become law,” Heldman said.

U.S. Representative Elijah Cummings, the top Democrat on the House of Representatives Committee on Oversight and Government Reform, said he would meet with Trump on Wednesday to discuss efforts to lower prescription drug prices.

Trump has long vowed to repeal and replace Obamacare. The House Republicans’ legislation would eliminate the requirement that most Americans obtain medical insurance and create a system of tax credits to encourage people to purchase private insurance.

After Monday's release of the replacement plan, hospital stocks fell, with Tenet Healthcare THC.N and Community Health Systems CYH.N each down more than 5 percent. Shares of health insurers were mostly modestly higher.

Trump’s tweet was his latest criticism of drug prices.

As president-elect, he said in January that the industry was “getting away with murder” in what it charges the government for medicines.

He told Congress last week that more needs to be done to bring down “artificially high” prices for prescription drugs.

While drug stocks have reacted to Trump’s comments, “so far there seems to be no there, there,” said Ira Loss, senior healthcare analyst with Washington Analysis.

Loss noted that Republicans historically are wary of “non-market solutions to drug pricing.”

“I think there is a big disconnect between what he’s talking about ... and what the natural instincts of a Republican-controlled Congress are,” Loss said.

Brad Loncar, manager of the Loncar Cancer Immunotherapy ETF CNCR.O, said Trump's comments are "the type of statement that would have sent biotech stocks down 4 percent six months ago."

“The fact that hasn’t come anywhere near that so far today I think is a good sign the market has learned to wait for specifics on these things and not overreact,” Loncar said. “Even tweets have a law of diminishing returns.”