2022-12-03-瑞士信贷集团-US_Large-Cap_BioPharma_Initiation_40页_2mb

US Large-Cap BioPharma Research Summary

Overview

Credit Suisse initiates coverage of US Large-Cap BioPharma stocks, recommending defensive exposure amid macro uncertainty. The sector is viewed as a refuge with strong secular growth drivers and manageable risks despite patent cliffs and regulatory pressures. Research highlights innovation, M&A, and catalysts for stock selection.

Stock Ratings and Recommendations

• Outperform: Merck, AbbVie, Eli Lilly, Pfizer due to higher growth potential, undervalued catalysts, and defensive positioning.
  • Merck: Strong oncology growth with Keytruda; valuation reflects lower risk compared to peers.
  • AbbVie: High short-term growth from portfolio leverage; lower relative valuation.
  • Eli Lilly: Leadership in obesity and Alzheimer's with positive pipeline catalysts.
  • Pfizer: Undersupplied pipeline and large-cap advantages post-COVID impact.
• Neutral: Johnson & Johnson, Bristol-Myers Squibb due to muted growth from patent expirations, LOE concerns, and pipeline uncertainties.
  • JNJ: Consumer separation pressures dividend; big pharma ROE below expectations.
  • BMY: High LOE risk; limited upside from current assets.
• Underperform: Amgen due to competition risks, overestimated long-term guidance, and lower growth potential compared to peers.

Key Themes

• Defensive Characteristics: US Large-Cap Pharma outperforms in economic volatility with high margins and stable revenues, offering better value than other sectors.
• Innovation and Growth: Secular drivers include biologics, cell/gene therapies, and mRNA; R&D spend is rising to offset patent cliffs.
• Patent Cliff Management: Expected $87 billion revenue loss by 2025–2030; companies are mitigating through M&A and pipeline advances.
• Regulatory and Reimbursement: US Inflation Reduction Act introduces drug price controls; however, impacts are manageable with short-term NPV effects.
• M&A Activity: Strategic acquisitions for small-cap assets remain likely, especially for larger firms, due to patent cliffs and pipeline needs.

Valuation and Risks

• Forward P/E ratios show US Pharma at 16–17x, cheaper than utilities and staples (18–20x).
• Methodologies use DCF blended with relative P/E, with risks including competition, clinical trial failures, and policy changes.
• Major risks: Patent expirations for big-name drugs, regulatory hurdles, pricing pressures, and macroeconomic uncertainties.

Author and Disclosure

Research by Trung Huynh and Carson Wong. Analyst certifications, conflicts, and local legal disclosures apply, ensuring independence and client focus.