Sector News

Big Pharma’s market cap stars of 2014: Lilly, AbbVie, AstraZeneca

March 19, 2015
Life sciences
Who can resist a numbers match-up? Not us, obviously. Even better when the winners are a bit unexpected. Today, it’s market cap, courtesy of EvaluatePharma and its annual state of the industry report.
Market cap growth, specifically. And the top performers aren’t necessarily those you’d expect.
Among Big Pharma, the company with the biggest jump in market cap last year was Eli Lilly & Co. That could surprise some folks who don’t follow LLY shares. The company isn’t the best-performing among its peers, when it comes to sales growth or R&D productivity. Still, investors boosted Lilly’s market value by 35%, with a share price boost to $68.99 from $51. Year-end total? $76.8 billion.
AbbVie comes in second, during a very dramatic year. It was going to buy Shire and move its headquarters to tax-friendly Ireland. But then the feds changed tax inversion rules, and AbbVie backed out. And at the end of the year, the company made it to market with Viekira Pak, its hep C treatment–and promptly inked a big exclusive deal with Express Scripts. Its market cap grew by 24%, to $104.3 billion. Share price at year’s end: $65.44.
Then there’s AstraZeneca, which might have had the most dramatic year of all. (Except, perhaps, Pfizer.) The U.K.-based drugmaker fended off a hostile bid from Pfizer, in a battle that grew heated, political and a bit impolite. In the process, CEO Pascal Soriot promised big things to his shareholders–including $45 billion in revenue by 2023–and apparently, investors listened. The company’s market value grew by 19%, to $88.9 billion. Year-end share price: $70.38. Pfizer’s final bid? £55 per share, or about $81 at today’s rates. At the time, the offer was worth more than $100 billion.
Biggest losers in Big Pharma–by market cap growth, at least? GlaxoSmithKline ($GSK) leads that group, with a 15% decline. The company suffered some big declines in sales of its megablockbuster lung drug Advair, with newer respiratory meds slow to pitch in. And China slapped GSK with a $489 million fine in connection with that bribery scandal that broke in mid-2013. Not good for the company image. GSK shares ended the year at £13.76, putting its market cap at $107.6 billion, per EvaluatePharma.
Sanofi edged downward by 2% and Pfizer eked out 2% growth, rounding out the three worst market performers of 2014, Big Pharma edition. Among the smaller companies, Allergan, Actavis and Shire took the growth cake, with Allergan skyrocketing by 91%, and Actavis and Shire each growing by about half.
By Tracy Staton

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