Teva Says Pivot to Growth Accelerating as Branded Drugs and Biosimilars Expand

Johnson & Johnson said it remains on track to grow through biosimilar competition for STELARA and expects its medicines, medical devices and pipeline to support accelerating growth through the end of the decade. Speaking at a Morgan Stanley event, Chief Executive Officer and Chairman Joaquin Duato said the company's current guidance calls for 6.5% adjusted operational sales growth and 7.3% adjusted earnings-per-share growth in 2026, with total revenue expected to exceed $100 billion for the first time. Duato said 2027 should be a better year than 2026 and that the company has line of sight to double-digit growth by the end of the decade, with more detail to come at an enterprise business review in early December. John Reed, executive vice president of Innovative Medicine and R&D, said Johnson & Johnson has 12 molecules that have achieved proof of concept and are in Phase III development, and that beyond DARZALEX it has 10 marketed medicines still early in their product life cycles. Capital allocation priorities center on launches such as ICOTYDE, INLEXZO, RYBREVANT, IMAAVY and the OTTAVA robotic surgical system, plus pipeline funding and earlier-stage business development, including the recent acquisitions of Halda Therapeutics and Firefly Bio and a collaboration with an option to acquire Sail. Duato said the company can reach double-digit growth this decade without acquisitions but views M&A as a way to reinforce growth into the following decade.

Morgan Stanley downgraded Novo Nordisk to Underweight from Equal-weight while keeping a $40 price target, sending NVO shares down 2.1% on Friday. The bank argued the valuation does not fully reflect muted medium-term growth and the looming semaglutide patent cliff, with key protections for Ozempic, Rybelsus and Wegovy expiring around 2031 in Europe and 2032 in the United States. Semaglutide concentration is acute: adjusted sales of Wegovy injectable, Wegovy pill, Ozempic injection and the Ozempic pill/Rybelsus franchise totaled about DKK 112.2 billion in the first half of 2026, roughly 75.5% of total adjusted first-half sales. Eli Lilly's competitive pressure compounds the problem, as Mounjaro generated $18.6 billion in the first half, up 106%, and Zepbound generated $9.1 billion, up 60%, for a combined $27.7 billion, while Novo's first-half Ozempic sales declined 2% at CER and Wegovy product sales rose just 7% at CER. Lilly also launched oral Foundayo in the United States in April 2026, and smaller rivals Structure Therapeutics and Viking Therapeutics are advancing their own GLP-1 obesity therapies.

Merck is relying on a growing pipeline and an expanding portfolio of newer medicines, including acquired assets, to offset the eventual loss of exclusivity for its blockbuster cancer drug Keytruda. Keytruda generated sales of $16.40 billion in the first half of 2026, up nearly 4.2% year over year, and is expected to remain strong until it loses patent exclusivity in 2028, after which biosimilars entering around 2028-2029 are likely to drive a sharp decline. Merck's phase III pipeline has almost tripled since 2021, and the company expects to launch 20 new drugs by 2030, with newer products already emerging as growth drivers: pulmonary arterial hypertension drug Winrevair and 21-valent pneumococcal conjugate vaccine Capvaxive generated $1.1 billion and $325 million, respectively, in first-half 2026 sales, while cancer drug Welireg sales surged 57% year over year to $470 million. Merck expects more than $70 billion of potential non-risk-adjusted commercial opportunity for the current pipeline by the mid-2030s, more than double the peak consensus sales estimate for Keytruda of $35 billion in 2028, and has stepped up acquisitions ahead of the patent expiry with deals for Verona Pharma, Cidara Therapeutics and Terns Pharmaceuticals. Management expects the Keytruda LOE period to look like a shallow dip with a fast return back to growth, even as Keytruda faces competition from Bristol Myers' Opdivo, Roche's Tecentriq and AstraZeneca's Imfinzi.