Barclays Initiating Coverage: A Seamless Approach to Biopharmaceuticals
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Rating Summary:
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Today's Overall Ratings:
Up: 7 | Down: 5 | New: 2
Rating Summary:
16 Buy, 13 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 7 | Down: 5 | New: 2
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Barclays Initiating Coverage: A Seamless Approach to Biopharmaceuticals
Barclays analyst, C. Anthony Butler, said, "Introducing a new approach to Life Sciences. We initiate coverage of 21 stocks in the biopharmaceutical space - across the U.S. Biotechnology, Major Pharmaceuticals and Specialty Pharmaceutical sectors. Developments in the industry have led us to take a more integrated approach to covering the sector at Barclays Capital. The distinctions between pharmaceutical, biotechnology and speciality pharmaceutical players have become increasingly blurred. Regardless of market capitalization or stage in drug development, companies across the sector are struggling with similar challenges: R&D productivity, identification of new growth drivers, pricing & reimbursement, and regulatory scrutiny worldwide. These companies are also competing in the same commercial space. At the core, all biopharmaceutical companies have the same mission statement: to develop and commercialize products - innovative or generic - that would improve the quality of life of patients and offer a cost-effective profile to society."
"We are positive on U.S. Major Pharmaceuticals, neutral on U.S. Biotechnology and U.S. Specialty Pharmaceuticals. Reflecting our three themes, we rate U.S. Major Pharmaceuticals 1-Positive because of improving pipelines and the perception that large-cap health care stocks are a relative safe-haven in a challenging macro environment. We are 2-Neutral on U.S. Biotechnology and U.S. Specialty Pharmaceuticals because the stocks in these sectors lack correlation and are typically driven by individual events."
"Our top picks are Johnson & Johnson (NYSE: JNJ), Biogen Idec (Nasdaq: BIIB), Vertex (Nasdaq: VRTX), Mylan (NYSE: MYL) and Jazz Pharma (Nasdaq: JAZZ). Among the three stocks we initiate on in U.S. Major Pharmaceuticals, we favor JNJ because of its innovative products and BIIB because of its stable MS franchise and pipeline. Among the eight U.S. Biotechnology names we initiate on, VRTX is our top pick as we believe its CF franchise will be a major driver of growth. Within U.S. Speciality Pharmaceuticals, among the 10 new names under our coverage, we recommend MYL for its projected strength in the U.S. generics business and JAZZ as we believe the company has an opportunity to replay its Xyrem "playbook" and grow Prialt."
"How we differ from the Street - we are Equalweight (NYSE: EW) on well-liked names such as Amgen (Nasdaq: AMGN), Incyte (Nasdaq: INCY), Medicis (NYSE: MRX), Warner Chilcott (Nasdaq: WCRX) and Teva Pharma (Nasdaq: TEVA). For AMGN, we expect further challenges to pressure the top line; we think Street INCY estimates and MRX growth expectations may be too high; we have concerns about the outlook for WCRX's key franchises and we see headwinds facing TEVA. We downgrade Abbott (NYSE: ABT) to Equalweight (from Overweight) as we see little potential for upside/downside movement near term."
Barclays analyst, C. Anthony Butler, said, "Introducing a new approach to Life Sciences. We initiate coverage of 21 stocks in the biopharmaceutical space - across the U.S. Biotechnology, Major Pharmaceuticals and Specialty Pharmaceutical sectors. Developments in the industry have led us to take a more integrated approach to covering the sector at Barclays Capital. The distinctions between pharmaceutical, biotechnology and speciality pharmaceutical players have become increasingly blurred. Regardless of market capitalization or stage in drug development, companies across the sector are struggling with similar challenges: R&D productivity, identification of new growth drivers, pricing & reimbursement, and regulatory scrutiny worldwide. These companies are also competing in the same commercial space. At the core, all biopharmaceutical companies have the same mission statement: to develop and commercialize products - innovative or generic - that would improve the quality of life of patients and offer a cost-effective profile to society."
"We are positive on U.S. Major Pharmaceuticals, neutral on U.S. Biotechnology and U.S. Specialty Pharmaceuticals. Reflecting our three themes, we rate U.S. Major Pharmaceuticals 1-Positive because of improving pipelines and the perception that large-cap health care stocks are a relative safe-haven in a challenging macro environment. We are 2-Neutral on U.S. Biotechnology and U.S. Specialty Pharmaceuticals because the stocks in these sectors lack correlation and are typically driven by individual events."
"Our top picks are Johnson & Johnson (NYSE: JNJ), Biogen Idec (Nasdaq: BIIB), Vertex (Nasdaq: VRTX), Mylan (NYSE: MYL) and Jazz Pharma (Nasdaq: JAZZ). Among the three stocks we initiate on in U.S. Major Pharmaceuticals, we favor JNJ because of its innovative products and BIIB because of its stable MS franchise and pipeline. Among the eight U.S. Biotechnology names we initiate on, VRTX is our top pick as we believe its CF franchise will be a major driver of growth. Within U.S. Speciality Pharmaceuticals, among the 10 new names under our coverage, we recommend MYL for its projected strength in the U.S. generics business and JAZZ as we believe the company has an opportunity to replay its Xyrem "playbook" and grow Prialt."
"How we differ from the Street - we are Equalweight (NYSE: EW) on well-liked names such as Amgen (Nasdaq: AMGN), Incyte (Nasdaq: INCY), Medicis (NYSE: MRX), Warner Chilcott (Nasdaq: WCRX) and Teva Pharma (Nasdaq: TEVA). For AMGN, we expect further challenges to pressure the top line; we think Street INCY estimates and MRX growth expectations may be too high; we have concerns about the outlook for WCRX's key franchises and we see headwinds facing TEVA. We downgrade Abbott (NYSE: ABT) to Equalweight (from Overweight) as we see little potential for upside/downside movement near term."
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