Broadly speaking, the pharmaceutical industry develops and manufactures a wide range of prescription drugs for a plethora of diseases and conditions, creating some of the biggest pharmaceutical companies across the globe.
As defined by Encyclopedia Britannica, the pharmaceutical sector involves “the discovery, development, and manufacture of drugs and medicines by public and private organizations.”
With an industry that is projected to grow at a compound annual growth rate (CAGR) of 6.9 percent to reach a staggering US$1.18 trillion in revenue by 2024, the Investing News Network takes a look at the five biggest pharmaceutical companies currently on the market.
The pricing of pharmaceutical products remains a hot topic of debate, however, especially in the US, which is the largest global pharmaceutical market. Evaluate’s report says that the Trump administration has been working towards changing drug policies by the 2020 elections, but that it could be “challenging for pharmaceutical manufactures” because it will impact drug pricing.
That being said, investors interested in the pharmaceutical industry can certainly benefit in knowing which companies are the major players in the space and what products they are working on. Despite the pricing issues the sector faces, pharma companies continue to develop innovative drugs in areas like immuno-oncology and neurology, as well as novel drugs for a range of rare diseases.
With that in mind, here are the five largest pharma companies by market cap size. Data for this article was compiled using Investing.com’s stock screener on February 20, 2020. The companies are listed in order of market cap size from largest to smallest.
1. Johnson & Johnson (NYSE:JNJ)
Market cap: US$369.11 billion
Starting off this list of the biggest pharmaceutical companies is Johnson & Johnson, a holding company focused on the overarching life sciences field. Life science companies often specify their focus, but thanks to its massive scale, Johnson & Johnson covers many areas through its subsidiaries.
In terms of pharmaceuticals, Johnson & Johnson’s treatment focus is on six therapeutic areas: cardiovascular and metabolism, infectious diseases and vaccines, neuroscience, oncology, immunology and pulmonary hypertension.
2. Roche Holding (OTCQX:RHHBY)
Market cap: US$289.86 billion
Roche Holding is one of the largest biotech companies in the field. Its reach expands into oncology, immunology, ophthalmology and diseases related to the central nervous system. The company has more than 90,000 employees spanning 100 countries around the globe. Roche boasts that it spends approximately 9 billion Swiss francs on research and development each year.
The pharmaceutical side of its business is focused on developing medicines for areas with unmet needs such as oncology, immunology, opthalmology, infectious diseases and neuroscience.
3. Novartis (NYSE:NVS)
Market cap: US$219.23 billion
Novartis is a healthcare company based in Switzerland. It has been in business since 1996 via the merger of Sandoz and Ciba-Geigy; the two companies combined have a history dating back more than 200 years.
Novartis prides itself on drugs that are manufactured for the treatment of cardiovascular diseases, Alzheimer’s disease, age-related macular degeneration, osteoporosis and more. The Sandoz division of the company produces over 1,000 different generic medicines and biosimilars. For its part, the Alcon division focuses on eyesight and related products. Novartis also employs 6,000 scientists and physicians to further its research and development in the field.
4. Merck (NYSE:MRK)
Market cap: $208.77 billion
Merck has risen as a global biopharmaceutical company operating in four different market areas: pharmaceuticals, animal health, healthcare services and alliances. The company, which has its headquarters in New Jersey, produces medicines, vaccines and animal health products.
The company claims to be developing products that address unmet medical needs and has more than 50 prescription products that target areas such as: cardiovascular disease, respiratory disease, oncology, neuroscience, infectious diseases, immunology and women’s health.
5. Pfizer (NYSE:PFE)
Market cap: US$200.50 billion
Another giant in the medical world, Pfizer is active in the development of multiple healthcare products. The company’s area of focus includes medical disciplines such as immunology, oncology, cardiology, endocrinology and neurology.
The company operates its commercial divisions under two segments: Pfizer Innovative Health and Pfizer Essential Health. The former focuses on medicines and vaccines that directly improve patient lives and products for consumer healthcare, while the latter is focused on therapeutic areas such as internal medicine, vaccines, oncology, inflammation and immunology, rare diseases and consumer healthcare.
This is an updated version of an article originally published by the Investing News Network in 2016.
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Securities Disclosure: I, Nicole Rashotte, hold no direct investment interest in any company mentioned in this article.