Large Cap Biopharma Winners YTD: Looking for Growth and Value in a Choppy Market..Update-2 BIG movers

Update-2 3p EDT BIOTECH Movers from our SMID trading list: EYPT up 14% to $10.46, ADPT up 10.4% to $1.74. Also many stocks are on top of daily range.

• Gilead Sciences (GILD) makes a new oncology deal for inhibiting tumor growth with Kymera Therapeutics.

Update-1 2:45P 6/24..Nice broad rally day with strength in tech stocks and financials. Green screen in biotech so we bought some ARKG cause it has slightly better momentum than XBI up 2%.Many ibg movers from our SMID biotech trading list: EXEL, EYPT, GH, RXRX etc. Even IBB and REGN is up 2%. Biotechs have room to run.

3p ET Medtech rally as well: ABT ,IHI,SYK.etc

Large Cap Biopharma Winners 2025: Looking for Growth and Value Amidst Unknown Tariiffs

• Large Cap biopharmaceuticals used to be a favorite market sector providing reliable growth, innovative products and attractive valuations but onerous government involvement in pricing and HHS cutbacks may have changed the longer term outlook.
• A portfolio of five stocks plus one ETF or fund should provide outperformance for 2025 despite unknown government pricing controls via tariffs.
• The ASCO conference provide some positive breakthroughs for the sector in immuno-oncology: innovation in molecular diagnostics and bispecifc antibodies.

You know we always have favored Large Cap biopharma stocks but this year it’s different . The industry has been under fire from Democrats for a few years over high drug prices and now we have attacks by Republicans trying to develop a pricing policy based on low prices in Europe . And on top of that you have a new Regulatory structure with massive cuts at HHS. As a result the performance of these stocks along with a lot of changes in product mix and competition create a lot of stock volatility..

Nonetheless if you have a basket off FIVE of these stocks you should be able to beat the market (the SPY or S&P 500) as we have done over the last year. Most of the TEN large caps we track are near their lows for the past 12 months so unless the TRUMP Administration hits the sector very hard with an unusually harsh pricing model they should do well. The valuations are not really stretched with PEs in the mid- teens and Price to Sales ratios of 3-5. We used the Conservative metric of PEG or price earnings to growth. We currently do not have buys on any of these stocks due to the backdrop of the industry but we would not sell any of them near term until earnings.

So we picked Five stocks for the portfolio and we may have to re-balance after earnings or any product portfolio news for these companies. We currently own the following stocks in order of weighting plus a few Health Science Funds (BBH and FBIOX) with large cap weighting and comparison. The FIVE for now are: ABBV, GILD, LLY PFE and VRTX. Here are some comments on the group based on about 6 months performance:

1. A few stocks we have owned in the past have been hit hard: Regeneron (REGN)down 31% YTD and we still have lost money getting this trade right.
2. Our best pick  is Gilead Sciences (GILD)  up 17.46% YTD, yet we still did not have enough of it. There is still good value in some of the losers like AZN and PFE and we have traded both, AZN has the best overall analyst recommendation, a buy at 1.37.
3. Note that with the exception of maybe BMY and PFE with an RSi (relative strength) in low 50s, there is very little MOMENTUM in any of these stocks.
4. Without a doubt the best stock of the group over 3-5 years has been LLY with their GLP-1 products for obesity and Diabetes Type 2 yet the stock has been volatile and overvalued for most of its run.
5. We expect clinical development news and small M&A and Licensing deals to support growth in the for the balance of 2025.
6. Shopping for bargains in underperforming  stocks: AZN and MRK.
7. Abbvie (ABBV) has been our best performer over the years with strong management and strength in Neuroscience and Inflammatory diseases. The stock is at $185 off its recent high $219.
8. Vertex up over 9% YTD has always been a favorite and should their new pain klller drug Journavx deliver it could be a big winner in 2025.
9. Another option by an ETF or a FUND: PPH up 1.2%, YTD, FBIOX down 4.6% YTD, JNGLX down 4.3%; but surely you can beat those returns.
10. Here is a Q1 performance summary published 4/28/25.

Must reading for 2025: GENETIC  ENGINEERING  NEWS 25 Years!! Get the special tissue today.

LARGE CAP Biopharma Stocks- LONG: ABBV, BMY, GILD, LLY, PFE ,VRTX;  long also Novariis (NVS) and Roche (RHHBY).

TECH= technicals (Flat, Down , Up); RSI =relative strength , PICK =Hold, Buy.