Pharma Market Forecast: Top Trends for Pharma in 2026

Policy pressure and revenue erosion

Potential tariffs on pharmaceutical imports to the US are projected to reach up to 200 percent starting in 2026, posing risks of increased costs and potential drug shortages in the country.

That's according to the American Journal of Managed Care, a peer-reviewed monthly publication that focuses on healthcare outcomes research, managed care and policy impacts on clinical and economic results.

To mitigate the risk of high penalties, major pharmaceutical companies committed billions to expanding US-based manufacturing in 2025. Novartis (NYSE:NVS) has said it will spend US$23 billion for 10 new US facilities, while AstraZeneca (NASDAQ:AZN) has pledged US$50 billion by 2030 to US manufacturing and R&D expansions.

However, 11 major pharma firms — Pfizer (NYSE:PFE), Eli Lilly and Company (NYSE:LLY), Amgen (NASDAQ:AMGN), Bristol-Myers Squibb (NYSE:BMY), Boehringer Ingelheim, Genentech, Gilead Sciences (NASDAQ:GILD), GSK (NYSE:GSK), Merck & Company (NYSE:MRK), Novartis and Sanofi (NASDAQ:SNY) — struck Most Favored Nation (MFN) pricing deals with the Trump administration to suspend tariffs for three years, mitigating immediate broad trade risks.

These pricing agreements cap US drug prices at the lowest global rates to avoid tariffs, with discounts of at least 38 percent off 2023 list prices for select drugs. The drugs will be available through TrumpRx, the government’s direct-to-consumer platform, set to launch in January 2026. The administration claims the platform will yield billions in Medicaid savings, while encouraging companies to invest in American manufacturing and donate active pharmaceutical ingredients to a national stockpile, lessening trade risks and increasing domestic production.

MFN deals compound pressure from the Inflation Reduction Act (IRA), through which the Centers for Medicare & Medicaid Services finalized 38 to 79 percent Medicare discounts on 10 high-cost drugs effective in January 2026.

These changes will squeeze margins for pharma giants reliant on US sales. Blockbuster drugs losing key US patents in 2026 without immediate replacements will add further pressure through the year as generic erosion accelerates, forcing M&A spending to refill dry pipelines amid IRA/MFN pricing caps, and compressing R&D budgets.

AI: Beyond hype to real integration

Artificial intelligence (AI) builders have long promised productivity gains and cost savings in healthcare.

“We’ve done some preliminary work that suggests there could be significant, long-term productivity gains in areas like biopharmaceuticals, drug discovery and clinical development,” Dr. David Song, a portfolio manager overseeing Tema ETFs' oncology and cardiovascular/metabolic exchange-traded funds, told INN.

“There (are also opportunities) … to be more efficient. Efficiency gains could lead to consumer gains, but also margin improvements for (companies) engaging in that," he added. Song also noted that while AI is an important driver in healthcare, it hasn’t been priced in to the largest extent in many pockets of healthcare.

For her part, life science market analyst Anastasia Bystritskaya cautioned that while AI assets advance, investors must probe for ecosystem embedding to avoid overvaluation. In emailed correspondence with INN, she urged investors to look beyond AI model hype in healthcare, focusing on practical signals of real clinical integration.

These include concrete alliances, like hospital electronic health record integrations, health system collaborations or medtech co-development deals that embed AI into daily clinician tools rather than edge prototypes.

Standalone tools often land in pilot purgatory due to data silos, procurement delays, regulatory shifts and clinician friction, while infrastructure plays build slowly into sticky, high-retention platforms.

Second, Bystritskaya said to check live data access: “What clinical data does the model use in daily operation? How is the data accessed, cleaned and updated? How are privacy and security handled in practice?”

Finally, the expert advised that investors listen for operational talk, commenting, “Mature companies speak about workflow fit, information technology security, staff training, regulatory strategy and reimbursement pathways. Companies that only describe model accuracy are usually not yet embedded.”

In her view, investors should tie valuations to deployment evidence like live sites, multi-year budgets and clear payment paths, avoiding bets on lab promise alone.

GLP-1s charge toward peak sales

GLP-1s are charging toward potential peak sales in 2026, with Eli Lilly and Novo Nordisk (NYSE:NVO) set to dominate as oral pills unlock massive volume despite regulatory headwinds. Novo Nordisk's Wegovy pill won US Food and Drug Administration (FDA) approval on December 22, with plans to launch in January 2026. The approval beat Eli Lilly's orforglipron, which is also slated for a Q1 entry, and sparked a 9 percent share price surge for the firm.

Pill simplicity and lower prices via TrumpRx could fuel uptake for obesity and cardiometabolic combinations, stabilizing supply post-shortages that allowed telehealth companies to sell cheap compounded semaglutide and tirzepatide without risk warnings. The FDA hit over 100 firms with warning letters in September 2025 for fair balance violations, and Novo Nordisk and Eli Lilly sued compounders for copying their drugs.

Telehealth firms have argued that the FDA lacks authority to regulate their advertising because they are not drug manufacturers, wholesalers or distributors. These legal battles continue to drag on, but Eli Lilly and Novo Nordisk have regained pricing power as compounders retreat.

Foley Lardner’s Kyle Faget told INN that Congress may need to intervene to clarify FDA jurisdiction over telehealth promotions, especially on fair balance and off-label claims.

“Anticipated regulations that will allegedly roll back the adequate provision standard for broadcast advertising could have a major impact on drug advertising, including the feasibility of doing so,” she explained.

“Drug pricing and how the MFN pricing will take shape have everyone on the edge of their seats. To the extent that pharmaceutical companies comply and come to the table with a new pricing scheme or simply adopt MFN pricing, there will be less money in the coffers for product development. It will be interesting to see if pharmaceutical companies go back to the negotiating table with other countries with respect to drug pricing.”

Meanwhile, vaccines face acute risks from RFK Jr.’s US Department of Health and Human Services overhaul.

“Gold standard” randomized controlled trials for vaccines risk frozen approvals and over US$2 billion in annual losses for Moderna (NASDAQ:MRNA) and Pfizer via slashed Medicaid and Vaccines for Children reimbursements.

Investor takeaway

2026 is shaping up to be a year of intense pressure and strategic redirection for the pharmaceutical industry.

Established giants are facing compounded margin compression and looming patent expirations, a challenging environment that is contrasted by key growth drivers.

Ultimately, the sector’s outlook hinges on a successful transition from reliance on blockbuster monopolies to a model focused on operational efficiency, differentiated therapeutic areas and clear pathways for tech deployment.

The ongoing regulatory battles in the pharmaceutical space underscore a rapidly shifting landscape where compliance and policy engagement are as critical as clinical innovation.