Stock Watch: Novartis And The Changing Face Of Big Pharma

Are Multi-Blockbusters Endangered Beyond The Current Crop?

 
• By Andy Smith
  
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The sun shines over a sector with multi-blockbuster products in their prime. But clouds are looming, and highly innovative products that cannot replace the sales shortfalls could lead to a re-rating of the sector’s growth prospects.

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ANDY SMITH OFFERS A LIFE SCIENCE INVESTOR'S PERSPECTIVE ON BIOPHARMA BUSINESS

When Novartis AG reported its first-quarter 2024 results, the difference in investors’ reaction compared with Johnson & Johnson’s results a week earlier could not have been greater. Novartis’s stock price opened up strongly in Zurich with a brief rise above 5% before trading commenced in New York. Novartis’s NYSE-listed stock price also rose by nearly 5% before closing the day of its announcement on both exchanges up about 2%. This compared with a gain of just over 1% for the NYSE Arca Pharmaceutical Index (DRG). In contrast, J&J’s share price opened down and continued to fall on the day of its announcement, declining by more than 2% while the DRG dropped less than 1%.

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