(MENAFN- Investor Ideas) GlobalData presents growth snapshot of top 20 pharma companies by revenue in 2018

 

August 26, 2019 (Investorideas.com Newswire) The year 2018 was another great year for the Innovation Bio/Pharma Industry as 16 of the top 20 publicly traded pharma players globally reported year-on-year (YoY) growth in their revenue, says GlobalData, a leading data and analytics company.

GlobalData analyzed the YoY change and compound annual growth rate (CAGR) for revenue, operating profit and net profit of the global publicly traded pharma companies over the past five years and selected the global top 20 firms based on 2018 revenues and the innovative nature of their revenues. This data is taken from the GlobalData Pharma Intelligence Center's Financials, Deals, and Drug Sales database and Consensus Forecast database.

sIn 2018, 16 of the top 20 publicly traded pharmaceutical players globally reported YoY growth in their revenue, with only Takeda Pharmaceutical Co Ltd, Celgene Corp (currently under a merger agreement with Bristol-Myers Squibb Co) and AbbVie Inc reporting over 15% YoY growth in revenue.

Takeda's revenue increased by 18.5% to US$18.9bn, driven by the strong performance of its key drugs Entyvio (vedolizumab) and Ninlaro (ixazomib). Takeda hopes its future growth will be driven by the acquisition of Shire in January 2019.

Celgene's revenue grew by approximately US$2.3bn, a 17.5% increase from 2017, as a result of increased sales of Revlimid (lenalidomide), Otezla (apremilast) and Pomalyst/Imnovid (pomalidomide), prompting the potential acquisition by Bristol-Myers Squibb, which is expected to be finalized later this year.

AbbVie's revenue grew by US$4.5bn, a 16.1% increase from 2017, mostly as a result of strong performances by Mavyret (glecaprevir/pibrentasvir), Imbruvica (ibrutinib) and Humira (adalimumab), which is no longer exclusive.

Gilead Sciences Inc. was the biggest loser among the top 20 players, with a 15.2% decline in revenue due to the weak performance of its hepatitis C virus (HCV) drugs including Harvoni (ledipasvir + sofosbuvir) (US$3.1bn, 72% YoY decline in sales) and Viread (tenofovir disoproxil fumarate) (US$0.7bn, 71% YoY decline in sales).

Despite the fact that Allergan Plc (which is currently in the process of being acquired by AbbVie) reported negative revenue growth in 2018, it has recorded a CAGR of 35.5% in revenue since 2014 due to a series of inorganic growth initiatives, including the reverse merger with Actavis.

Peter Shapiro, Director at GlobalData, comments: "The top gainers reported over 25% growth in operating profit include Eli Lilly and Co., GlaxoSmithKline Plc., and Merck & Co. Inc. as a result of the historic one-time repatriation tax opportunity, which was favorable for these companies. Novartis AG's 61.5% increase in its operating profit was driven by the growth in income of its associated companies (grew from US$1.1bn in 2017 to US$6.4bn) due to the pre-tax gain of US$5.8bn from the sale of 36.5% stake in the GSK consumer healthcare joint venture.

"Gilead Sciences Inc., Bayer AG, AbbVie Inc. and Merck KGaA reported operating profit declines of over 25% in 2018. The operating profit of Gilead Sciences Inc. declined due to its high costs of goods sold (COGS), R&D and selling, general, and administrative (SG&A) expenses, including a renewed investment in Oncology.

"High impairment losses contributed the operating profit decline of Bayer AG. Higher operating costs and expenses contributed to AbbVie's losses, which is seeing the slow decline of Humira sales, which long was the industry leader.

"The increase in provisions for obligations from long-term variable compensation programs negatively impacted the operating result of Merck KGaA in 2018. Although Merck & Co Inc. reported 37.8% growth in its operating profit, it reported a negative CAGR of 16.2% as a result of a one-time gain from the divestiture of its Consumer Care business in 2014 to Bayer AG."

On the profitability side, 10 out of the top 20 companies reported over 25% growth in net profit. Eli Lilly and Co, Johnson & Johnson, Bristol-Myers Squibb Co, Amgen Inc., Merck & Co Inc., and GlaxoSmithKline Plc reported more than 100% growth in profits.

Eli Lilly and Co was back to profitability as a result of the historic one-time repatriation tax opportunity and Johnson & Johnson was also a major beneficiary, with the provisional amount of approximately US$13.6bn associated with the enactment of tax legislation.

Bristol-Myers Squibb Co, Amgen Inc., Merck & Co Inc., and GlaxoSmithKline Plc's profit growth was also mainly attributed to tax reforms, which significantly brought down their effective tax rates along with a stronger operating performance, lower restructuring costs and lower asset impairment charges.

In 2018, the six players that reported YoY declines in profitability were Bayer AG, Sanofi, Pfizer Inc., Takeda Pharmaceutical Co Ltd, AstraZeneca Plc and Allergan Plc. Impairment losses, acquisition costs and restructuring costs mainly led to the drop in net profits seen by Bayer AG.

Sanofi and Pfizer Inc's profit dipped almost 50% in 2018 due to the divestment of Sanofi's Animal Health business in 2017 and Pfizer Inc's non-recurrence of US$10.7bn in tax benefits, as recorded in Q4 2017 to reflect the December 2017 enactment of the Tax Cut and Jobs Act. Over the past five years, Gilead Sciences Inc, Bayer AG, and Merck & Co Inc reported negative CAGRs of 18.1%, 16.1%, and 15%, respectively.

For more information

To gain access to our latest press releases, please visit this website: GlobalData Media Centre

Analysts are available for comment. Please contact the GlobalData Press Office at the phone numbers or email listed below:

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Editor's notes

• Quotes are provided by Peter J. Shapiro Ph.D. Senior Director of Drugs and Business Fundamentals


• The information is based on GlobalData's Pharmaceutical Intelligence Center


• This press release was written using data and information sourced from proprietary databases, primary and secondary research, and in-house analyses conducted by GlobalData's team of industry experts

About GlobalData

A total of 4,000 of the world's largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make timelier and better business decisions thanks to GlobalData's unique data, expert analysis, and innovative solutions, all in one platform. GlobalData's mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology, and professional services sectors.

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