Credit Suisse Offers '15 US Large-Cap Pharma Outlook

The pharmaceutical sector was very volatile throughout 2015 and Vamil Divan of Credit Suisse is expecting the sector-wide challenges to remain in the coming year. In a sector-wide outlook, Divan suggested that the large-cap pharmaceutical space is unlikely to outperform in the coming year. Nevertheless, there will be winners in the space (and losers) and will likely be determined by the outcome of a handful of key data release – as has been the norm for the past few years. "Positive product news as well as continued M&A/business development may provide opportunities for upside, although we believe this may be balanced out by fewer impactful pipeline readings in 1H 2016 and increasing payer pressure and public debates around drug prices through the US Presidential Election cycle."

Heading into 2016, Divan prefers owning Eli Lilly given near-term momentum in Jardiance and a "relatively de-risked" product pipeline over the longer term. The analyst added that Pfizer's acquisition of

will warrant a higher multiple as investor confidence surrounding the deal improves. Finally, Bristol-Myers immuno-oncology segment will see an uptick along with a strong uptake of Opdivo in lung cancer and the release of novel I-O combo data expected throughout 2016. Related Link: