Lilly, Novo Nordisk and Vertex lead on market capitalisation growth

Stock market

The top 20 global biopharmaceutical companies have reported 1.6% market capitalisation growth to $3.67 trillion in 2023, according to data analysts GlobalData.

The top 20 global biopharmaceutical companies experienced varied year-on-year (YoY) market capitalisation shifts in 2023 amid the macroeconomic headwinds, steep patent cliffs and the commencement of US drug price negotiations under the Inflation Reduction Act (IRA).

Nonetheless, there was a resilient upturn of 1.6% in aggregate market capitalisation from $3.61 trillion on 31 December 2022 to $3.67 trillion on 31 December 2023, GlobalData has revealed.

Out of the top 20 players, nine companies indicated positive growth in stock market value, with four companies – Lilly (59.2%), Novo Nordisk (51.5%), Vertex Pharmaceuticals (41.4%) and Regeneron Pharmaceuticals (21.8%) – reporting more than 20% YoY growth in market capitalisation.

The top players in biopharma

Alison Labya, MSc, Business Fundamentals Analyst at GlobalData, comments: “Lilly witnessed the largest market capitalisation growth of almost 60% to $553.4 billion in 2023, displacing Johnson & Johnson as the top player in the biopharmaceutical industry.”

Lilly’s substantial market capitalisation growth in 2023 was attributed to the positive performance of its injectable synthetic peptide diabetes drug Mounjaro (or Zepbound). Lilly’s growth was further fuelled by Mounjaro’s FDA approval for the treatment of obesity received in Q3, with Mounjaro forecasted to reach global forecast sales of $4.7 billion for 2023.

Like Lilly, the success of Novo Nordisk’s obesity and diabetes drugs – Wegovy and Ozempic – drove its market capitalisation growth to $355 billion.

Vertex moved up by four places in the list with a market capitalisation growth of 41.4% in 2023, fuelled by the FDA approval of its CRISPR-based ex vivo cell therapy Casgevy.

Regeneron’s market capitalisation growth was attributed to the FDA approval of its high-dose Eylea – a VEGF fusion protein – for eye diseases, which may likely offset standard Eylea’s expected sales decline following looming biosimilar competition.

Companies seeing a market capitalisation decline

A total of 11 biopharmaceutical companies saw a market capitalisation decline in 2023, with Moderna (-45.1%), Pfizer (-43.5%), Bristol-Myers Squibb (-31.8%), Johnson & Johnson (-18.3%) and Daiichi Sankyo (-14.1%) registering more than 10% YoY decline in their market capitalisation.

Moderna and Pfizer’s market capitalisation decline was due to the diminishing demand for their Covid-19 products. Furthermore, Pfizer announced in Q4 its oral GLPR1 agonist danugliplon will not progress into Phase III trials for the treatment of obesity. Danugliplon was anticipated to rival Novo Nordisk’s Wegovy and Lilly’s Mounjaro in the weight loss drug market, amid efforts to mitigate post-Covid declines in revenue.

Bristol-Myers Squibb reported a market capitalisation decline of 31.8% in 2023, largely due to the reduced sales of its blockbuster blood cancer drug Revlimid resulting from generic competition.

Labya concluded: “In light of the waning demand for Covid-19 products, the biopharmaceutical companies that reaped success in 2023 have shifted to those that have developed weight loss drugs, such as Lilly and Novo Nordisk. However, other biopharmaceutical companies are faced with the imminent patent cliffs and ongoing US drug price negotiations under the IRA, with the CEOs of Merck, Johnson & Johnson and Bristol-Myers Squibb having testified on high drug prices at a US Senate hearing in February 2024.”

By DIANA SPENCER, Senior Digital Content Editor, DDW

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