As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q4. Today, we are looking at branded pharmaceuticals stocks, starting with Supernus Pharmaceuticals (NASDAQ:SUPN).
The branded pharmaceutical industry relies on a high-cost, high-reward business model, driven by substantial investments in research and development to create innovative, patent-protected drugs. Successful products can generate significant revenue streams over their patent life, and the larger a roster of drugs, the stronger a moat a company enjoys. However, the business model is inherently risky, with high failure rates during clinical trials, lengthy regulatory approval processes, and intense competition from generic and biosimilar manufacturers once patents expire. These challenges, combined with scrutiny over drug pricing, create a complex operating environment. Looking ahead, the industry is positioned for tailwinds from advancements in precision medicine, increasing adoption of AI to enhance drug development efficiency, and growing global demand for treatments addressing chronic and rare diseases. However, headwinds include heightened regulatory scrutiny, pricing pressures from governments and insurers, and the looming patent cliffs for key blockbuster drugs. Patent cliffs bring about competition from generics, forcing branded pharmaceutical companies back to the drawing board to find the next big thing.
The 11 branded pharmaceuticals stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.3%.
While some branded pharmaceuticals stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.4% since the latest earnings results.
Best Q4: Supernus Pharmaceuticals (NASDAQ:SUPN)
Founded in 2005, Supernus Pharmaceuticals (NASDAQ:SUPN) develops and commercializes treatments for central nervous system (CNS) disorders, focusing on epilepsy, ADHD, and Parkinson’s disease.
Supernus Pharmaceuticals reported revenues of $174.2 million, up 6% year on year. This print exceeded analysts’ expectations by 12.2%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EPS estimates and full-year operating income guidance topping analysts’ expectations.
“Our 2024 results reflect solid commercial execution across the company, including continued growth of our core products, and strong growth in operating earnings,” said Jack Khattar, President and CEO of Supernus.
Supernus Pharmaceuticals pulled off the biggest analyst estimates beat of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 6.6% since reporting and currently trades at $30.67.
Is now the time to buy Supernus Pharmaceuticals? Access our full analysis of the earnings results here, it’s free.
Pfizer (NYSE:PFE)
Founded in 1849, Pfizer (NYSE:PFE) is a global pharmaceutical company that develops and produces a wide range of medicines and vaccines for various medical conditions.
Pfizer reported revenues of $17.76 billion, up 21.9% year on year, outperforming analysts’ expectations by 3%. The business had a strong quarter with an impressive beat of analysts’ organic revenue and EPS estimates.
Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 2% since reporting. It currently trades at $25.69.
Is now the time to buy Pfizer? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Zoetis (NYSE:ZTS)
Originally a subsidiary of Pfizer, Zoetis (NYSE:ZTS) is an animal health company that develops and distributes medicines, vaccines, and diagnostic products for livestock and pets.
Zoetis reported revenues of $2.32 billion, up 4.7% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ full-year EPS guidance estimates.
As expected, the stock is down 7.7% since the results and currently trades at $160.42.
Read our full analysis of Zoetis’s results here.
Johnson & Johnson (NYSE:JNJ)
Founded in 1886 by Robert Wood Johnson in New Jersey, Johnson & Johnson (NYSE:JNJ) develops and sells pharmaceuticals, medical devices, and consumer health products.
Johnson & Johnson reported revenues of $22.52 billion, up 5.3% year on year. This print was in line with analysts’ expectations. It was a satisfactory quarter as it also produced a solid beat of analysts’ organic revenue estimates.
The stock is up 10.2% since reporting and currently trades at $163.33.
Read our full, actionable report on Johnson & Johnson here, it’s free.
Eli Lilly (NYSE:LLY)
Founded in 1876, Eli Lilly (NYSE:LLY) is a global pharmaceutical company that develops and produces a wide range of medicines and vaccines for medical conditions such as diabetes, cancer, and mental health disorders.
Eli Lilly reported revenues of $13.53 billion, up 44.7% year on year. This result met analysts’ expectations. It was a strong quarter as it also recorded an impressive beat of analysts’ full-year EPS guidance estimates.
Eli Lilly delivered the fastest revenue growth among its peers. The stock is down 4.7% since reporting and currently trades at $803.48.
Read our full, actionable report on Eli Lilly here, it’s free.
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