(Washington Post illustration; iStock)

SAN FRANCISCO — The biggest biopharmaceutical event of the year kicks off this week as 450 health-care companies and thousands of investors descend on this city for a week of dealmaking, networking and trying to read the tea leaves for what President-elect Donald Trump will do — or not do — about drug prices.

The J.P. Morgan Healthcare Conference, held Monday through Thursday, brings together leaders from across the health-care ecosystem: drug companies that are household names, up-and-comers trying to launch the next big medicine and insurers who help pay for it all. At packed sessions and investor meetings scattered across a soggy, rain-soaked city, hundreds of companies will set the tone for the next year. But they face an added layer of uncertainty this year, trying to divine what a president-elect who has been critical of high drug prices and vowed to repeal the Affordable Care Act will mean for business.

“Everybody is going to be trying to figure out what’s going on with the new administration and drug pricing. Everyone’s going to be asking that question — and nobody’s going to have answers,” said Brad Loncar, an independent biotech investor. “That’s the No. 1 thing that’s going to impact our entire industry.”

No drug company wants to find itself catapulted into the national spotlight on the wrong end of President-elect Trump’s tweets. And the industry may be at a particularly vulnerable moment, because with the flip of the calendar year, people’s health insurance deductibles have been reset. That means people with high deductible plans will find themselves burdened with the full price of their prescriptions at the pharmacy counter until they hit their limit — providing possible kindling to spark another outrage on drug prices. Controversy over EpiPen maker, Mylan, was stirred by social media in the summer, right when many parents were restocking EpiPens for the school year.

The industry is coming off a tough year, with only 22 novel drugs reaching the market, compared with 45 last year. And the political outrage over high drug prices, though directed at a handful of companies and drugs, casts a looming shadow over the entire industry. Drug companies were initially buoyed by Trump's election, and politicians are focused on repealing President Obama's signature health-care law, but a poll by the Kaiser Family Foundation suggests that the affordability of medical care and drug prices will remain a key issue for people.

Brent Saunders, chief executive of Allergan, vowed last year to limit drug price increases to one-time, single digit hikes annually. And according to an investor note from Evercore ISI senior managing director, Umer Raffat, the company technically followed through, raising the prices of many drugs by 9 or 9.5 percent in the first days of this year.

Will other companies follow suit and temper their price increases? Will simply staying below 10 percent be safe? Some analysts think that the industry may be at a turning point, when it can no longer rely on price increases of existing drugs to boost their sales. Others are more cynical and think companies will continue to try to raise prices under the radar — and launch drugs at very high prices.

“I expect people to continue to try to maximize on new launches, because that one has been flying under the radar. About 50 percent of drug cost increases come from launching at a new higher cost,” said Ronny Gal, an analyst at Sanford C. Bernstein. “As for drug price increases, the short answer is they’ll try to sneak it in — day before Thanksgiving,” for example.

Geoffrey Porges, an analyst at Leerink Partners, said that if the industry stops relying on price increases to grow their revenue, the overall growth rate could be slashed in half.

That means companies will have to grow by other means, such as inventing new medicines or increasing the volume of drugs they sell. And because many big companies don't have a new big blockbuster drug ready and waiting in the wings, this shift could pave the way for big deals between companies. Dealmaking could be bolstered if there's a tax repatriation holiday under the new administration, which could allow companies to bring cash into the country they've been stowing overseas. The possibility of broader corporate tax reform will also fuel the deal speculation.

“If we can’t grow by price and we have a finite amount of innovation internally, how do we become more aggressive at consolidating the industry?” Porges said. “There’s a lot of discussion about deals going in to J.P. Morgan, and I think even more so than ever there are going to be discussions about what deals are possible or even likely as a result of these changes.”

Striking the tricky balance between bolstering innovation and paying for it is one that goes beyond just this industry event. President Obama recently spoke about why the United States pays more for drugs than other countries, during an interview about health care with Vox on Friday.

“It is true that we essentially come up with the new drugs in this country because our drug companies are fat and wealthy enough that they can invest in the research and development. They make bigger profits, which they can plow back into drug development,” Obama said. “This is an example where you probably do want some balance to maintain innovation, but to have some tougher negotiations around the system as a whole.”