Pfizer, Bristol Myers Squibb, and Johnson & Johnson: Navigating the Looming Patent Cliff

1. Patent Cliff Impact: By 2030, patents will expire for nearly 200 drugs, affecting almost every major pharma company, including Pfizer, Bristol Myers Squibb, and Johnson & Johnson.
2. Revenue Loss: The industry's total value of sales at risk will spike to $44.4 billion in 2024, with significant revenue losses expected for key drugs like Humira, Keytruda, Opdivo, and Stelara.
3. Biologics and Biosimilars: Biologics, such as Keytruda, Opdivo, and Stelara, will face less immediate competition from biosimilars compared to generics, but biosimilars are not identical copies and may not sell at significant discounts.
4. Company Strategies:
- Pfizer: Acquired Seagen for $43 billion to expand its cancer drug portfolio and mitigate the impact of patent expirations.
- Bristol Myers Squibb: Testing a more convenient version of Opdivo, which could lead to extended market exclusivity if approved.
- Johnson & Johnson: Strengthening its heart business through acquisitions like Shockwave Medical and focusing on cancer and heart disease treatments.
5. Industry Trends: Pharmaceutical companies are shifting focus to cancer and heart disease treatments, and are engaging in mergers and acquisitions to replenish their pipelines and offset revenue losses.
6. Market Projections: Despite the challenges, JPMorgan expects the patent cliffs to be "largely manageable" as drug pipelines improve, with biopharmaceutical industry sales projected to remain "roughly stable" through 2030.