The financial information company S&P Global, most known for the S&P 500 index, rated the world’s top pharmaceutical companies in a new report this month. Its ratings were based on two factors: business strength — which includes competitive advantage, prospects for sustaining revenue growth, and product diversification — as well as financial risk.
These are 10 of the strongest pharma companies, according to S&P.
Johnson & Johnson was one of two companies determined by S&P to have an excellent business risk profile and a minimal financial risk profile. S&P said that Johnson & Johnson’s main strength was its scale. In 2023, the pharma giant generated $85 billion in revenue — the most of any company on this list.
Roche was the other pharma company to have an excellent business risk profile and a minimal financial risk profile. Its primary strength was its number of blockbuster drugs — drugs that generated over $1 billion in sales annually. In 2023, the company had 15 blockbuster drugs.
Although Sanofi was determined to have an excellent business risk profile, it has a modest financial risk profile, according to S&P. In 2023, the French pharma giant generated $46 billion in sales and its net income was $11 billion.
S&P said that Novartis has an excellent business risk profile and a modest financial risk profile. Among its strengths was the diversity of its products at targeting different diseases. The company’s three top-selling drugs in 2023 treated heart failure, psoriasis, and anemia.
AstraZeneca joins Sanofi and Novartis in having excellent business risk profile and a modest financial risk profile. S&P said one of its weaknesses was its history of revenue declines. In the last 10 years, AstraZeneca had four years where its sales fell year over year.
Novo Nordisk, the maker of Ozempic, is the only company on this list to have a strong business risk profile and a minimal financial risk profile. Its strengths are a lack of historical revenue declines and innovation driven revenue growth. Its main weakness is a lack of product diversity. S&P wrote that Novo Nordisk’s revenue concentration from its top product “is materially higher than the average of peers,” at above 40% of its total revenue.
Eli Lilly, the company behind Mounjaro, rated slightly below its rival Novo Nordisk with a strong business risk profile and a modest financial risk profile. It had similar strengths and weaknesses as Novo Nordisk.
“Both Eli Lilly and Novo Nordisk have higher focus in products for a single disease (diabetes) than similar peers,” wrote S&P in its report. “We expect this will decline, helped by strong revenue growth in GLP-1 based products approved for obesity.”
Merck, like Eli Lilly, was rated as having a strong business risk profile and a modest financial risk profile. Its main strength was that it generated over half of its revenue outside of the United States.
Despite being rated as having an excellent business risk profile, Pfizer was also rated has having an intermediate financial risk profile. S&P noted that a decline in sales in COVID-19 related products in recent years has significantly reduced revenues at Pfizer.
GSK had the same ratings as Pfizer — an excellent business risk profile and an intermediate financial risk profile. Its weakness was it scale. In 2023, it generated $38 billion in revenue, among the lowest from companies on this list.
