Ups and downs: top pharma stocks post-COVID


There is little argument that the COVID-19 pandemic has reshaped the world. As families and governments continue to grapple with Omicron variants, back to school and flu season, the latest CDC guidelines have effectively eliminated masking and testing mandates, and scaled back protocols to stay current with vaccinations. Unofficially, we are now living a post-COVID life, at least culturally.

Here’s a deeper look at today’s biggest pharma companies and how they weathered COVID.

Modern pharmaceutical giants

Pfizer, Moderna, AstraZeneca and Johnson & Johnson grabbed headlines when they released the most anticipated vaccines of all time. But these are not the only names to know in the industry. Here’s an overview of the top pharma stocks you should know, ranked by market capitalization:

  • Johnson & Johnson: Long before COVID, Johnson and Johnson was a diversified medical, pharmaceutical and consumer goods company. The New Jersey-based company was founded in 1886. The central business plans to transform its consumer healthcare business into a new company. The former J&J will focus on pharmaceuticals and medical devices. The new spin-off will include brands such as Band-Aid, Tylenol, Neutrogena, Aveeno, Motrin and Johnson’s Baby Powder. Over the past two quarters, the stock has been pretty much stable. That’s down about 5% from last month.
  • Eli Lily: Another great old company, Eli Lilly was founded in 1876. It offers a line of commonly prescribed drugs for diabetes, cancer and other ailments. One of the most recognizable brands owned by Eli Lilly is the men’s health drug Cialis. He sells several varieties of insulin injections, a highly sought-after and essential drug to keep patients alive. Eli Lilly has risen dramatically over the past six months, delivering impressive gains of 28% with multiple short-term gain spells. It’s modestly last month.
  • Rock : Swiss-based healthcare company with major divisions focused on pharmaceuticals and diagnostics. The 125-year-old company focuses pharmaceutical research on blood disorders, infectious diseases, inflammatory bowel disease, cancer, respiratory diseases, women’s health and others. Roche is listed on a Swiss stock exchange or directly in the United States via an ADR. It has risen slightly over the past month and six-month periods, although the stock has been through a volatile period where returns were much less stable.
  • Pfizer: Another big winner in the race for the COVID vaccine. Tracing its roots to 1849, this pharmaceutical giant produces several blockbuster drugs, but all pale in comparison to the Pfizer and BioNTech vaccine, which generated nearly $60 billion in sales last year. He sells many other drugs, including prescription blood thinners, cancer drugs, and a pneumococcal vaccine. One-month and six-month returns leave investors roughly even.
  • AbbVie: A relative newcomer, founded in 2013. However, it was spun off from a major pharmaceutical company, Abbott Laboratories, so it didn’t start from scratch. Its top seller is Humira, which reached $20 billion in sales in 2021. However, the company is not without controversy. The pharmaceutical giant is among several drugmakers known to raise prices for critical drugs, Humira included. Other noteworthy drugs treat lymphoma, psoriasis, and arthritis. Well-known brands include Botox and Celexa. It has fallen slightly over the past six months, and one-month holders of this stock saw a loss of just under 5%.

These top five pharma stocks don’t include big names like Merck, Astrazeneca, Amgen, Moderna or GlaxoSmithKline. About 500 companies participate in the pharmaceutical industry worldwide.

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GSK in the news

Formerly GlaxoSmithKline, GSK didn’t release the first COVID drug, but that doesn’t mean it’s not worth investigating. The stock fell on August 11, 2022 due to negative news regarding the heartburn drug Zantac.

Once upon a time, Zantac was a darling at GSK. The drug was pulled from stores by government order in 2020 over fears that Zantac could cause cancer. GSK maintains that there is no evidence that Zantac causes cancer. Either way, GSK and two related pharmaceutical stocks, Sanofi and Haleon, fell on the news. A Deutsche Bank analyst has suggested a possible liability of billions of dollars.

Unique Opportunities and Risks of Pharmaceutical Stocks

A blockbuster drug can make or break a small pharmaceutical company. Many small pharmaceutical companies come and go quietly. For big pharma, spending millions or billions of dollars on a drug that doesn’t turn out to be a success is not uncommon.

When boutique pharma companies come up with a winning drug that generates big sales, these smaller companies are often acquired by one of the larger pharma companies, offering its founders and investors a chance to profit while adding scale of production. and marketing power to build the value of the drug under its new ownership.

For example, GSK has agreed to acquire biopharmaceutical company Sierra Oncology for $1.9 billion, adding new drugs to its approvals pipeline, trials it hopes to submit to regulators in the United States and Europe. European Union by the end of 2022. That’s a big $1.9 billion bet. for GSK. If the drugs are approved, the purchase will probably pay off well. If the drug unexpectedly fails approval, it could be nearly $2 billion lost with little to show beyond patents.

Huge investment risks in pharmaceutical research

In 2021, the FDA approved around 50 new drugs. With dozens of companies working around the clock to deliver the next high-grossing drug, there’s never a guarantee that a drug will succeed even after going through late-stage trials.

The The FDA published a study (PDF) of promising drugs that have passed phase two trials but have not been approved. For example, darapladib was a drug intended to treat heart attack risk, but was not approved due to lack of efficacy. GSK also had the MAGE-A3 vaccine, an immunotherapy treatment for lung cancer, denied for the same reason.

Major Pharmaceutical Developments on the Horizon

Just as bad news can wreck a pharmaceutical company’s financial prospects, a winner can send a stock price soaring. Here are some important developments on the horizon that could change the health of the world and generate a healthy profit doing so:

  • CRISPR: CRISPR is a gene editing technology that has the potential to treat almost any genetic disease. Early successes aim to treat sickle cell disease, while others focus on cancer, diabetes, cardiovascular disease and other conditions. Five stocks to be aware of in this industry include Beam Therapeutics, CRISPR Therapeutics, Editas Medicine, Intellia Therapeutics, and Verve Therapeutics.
  • Alzheimer’s: The degenerative brain disease has several potential treatments in the pipeline of big pharma, including Eli Lilly and Roche.
  • Diabetes: Eli Lilly has high hopes for a new diabetes drug that it estimates will bring in nearly $5 billion a year by 2026. As a growing health problem, diabetes drugs are a growing market. full growth to watch.
  • Cancer: While there may never be a “one-size-fits-all cure for cancer,” many big pharma and biotech companies have their research and development teams hard at work on treatments to fight specific cancers.

If you are serious about pharmaceutical investments, it is important to cast a wider network of information than expected blockbuster drugs. Even smaller drugs for lesser-known diseases sell to patients who need them. These sales represent millions and billions of dollars per year. Depending on the drug and the company, that might be enough to influence the stock price.

Conclusion on Pharmaceutical Actions

Although companies may receive mixed feedback from consumers about pricing practices, there is no doubt that the pharmaceutical industry is vital to people’s lives and is not going away any time soon. While legislation and news about new drugs can quickly alter stock prices, savvy investors strive to stay one step ahead.

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