Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Royalty Pharma (NASDAQ: RPRX) and the best and worst performers in the branded pharmaceuticals industry.
Looking ahead, the branded pharmaceutical 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 10 branded pharmaceuticals stocks we track reported a satisfactory Q1. As a group, revenues were in line with analysts’ consensus estimates.
While some branded pharmaceuticals stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.4% since the latest earnings results.
Royalty Pharma (NASDAQ: RPRX)
Pioneering a unique business model in the pharmaceutical industry since 1996, Royalty Pharma (NASDAQ: RPRX) acquires rights to receive portions of sales from successful biopharmaceutical products, providing funding to drug developers without conducting research itself.
Royalty Pharma reported revenues of $568.2 million, flat year on year. This print was in line with analysts’ expectations, and overall, it was a satisfactory quarter for the company with a solid beat of analysts’ EPS estimates.
“Our business momentum continued in the first quarter of 2025 as we delivered double-digit growth in Portfolio Receipts and raised our financial guidance,” said Pablo Legorreta, Royalty Pharma’s founder and Chief Executive Officer.
Interestingly, the stock is up 6.4% since reporting and currently trades at $34.91.
Is now the time to buy Royalty Pharma? Access our full analysis of the earnings results here, it’s free.
Best Q1: Bristol-Myers Squibb (NYSE: BMY)
With roots dating back to 1887 and a transformative merger in 1989 that gave the company its current name, Bristol-Myers Squibb (NYSE: BMY) discovers, develops, and markets prescription medications for serious diseases including cancer, blood disorders, immunological conditions, and cardiovascular diseases.
Bristol-Myers Squibb reported revenues of $11.2 billion, down 5.6% year on year, outperforming analysts’ expectations by 3.9%. The business had a very strong quarter with an impressive beat of analysts’ EPS estimates and full-year revenue guidance slightly topping analysts’ expectations.
Bristol-Myers Squibb achieved the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 3.2% since reporting. It currently trades at $46.93.
Is now the time to buy Bristol-Myers Squibb? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Eli Lilly (NYSE: LLY)
Founded in 1876 by a Civil War veteran and pharmacist frustrated with the poor quality of medicines, Eli Lilly (NYSE: LLY) discovers, develops, and manufactures pharmaceutical products for conditions including diabetes, obesity, cancer, immunological disorders, and neurological diseases.
Eli Lilly reported revenues of $12.73 billion, up 45.2% year on year, exceeding analysts’ expectations by 0.9%. Still, it was a slower quarter as it posted a significant miss of analysts’ full-year EPS guidance estimates and a miss of analysts’ EPS estimates.
As expected, the stock is down 12.5% since the results and currently trades at $784.03.
Read our full analysis of Eli Lilly’s results here.
Collegium Pharmaceutical (NASDAQ: COLL)
Pioneering abuse-deterrent technology in a field plagued by addiction concerns, Collegium Pharmaceutical (NASDAQ: COLL) develops and markets specialty medications for treating moderate to severe pain, including abuse-deterrent opioid formulations.
Collegium Pharmaceutical reported revenues of $177.8 million, up 22.7% year on year. This print surpassed analysts’ expectations by 2.3%. It was a satisfactory quarter as it also put up a decent beat of analysts’ EPS estimates.
The stock is up 8.5% since reporting and currently trades at $29.60.
Read our full, actionable report on Collegium Pharmaceutical here, it’s free.
Organon (NYSE: OGN)
Spun off from Merck in 2021 to create a company dedicated to addressing unmet needs in women's health, Organon (NYSE: OGN) is a global healthcare company focused on improving women's health through prescription therapies, medical devices, biosimilars, and established medicines.
Organon reported revenues of $1.51 billion, down 6.7% year on year. This result topped analysts’ expectations by 0.6%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ EPS estimates.
The stock is down 23.9% since reporting and currently trades at $9.83.
Read our full, actionable report on Organon here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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