Nomura bearish on European pharmaceuticals

With rich valuations driven by cyclical rotation towards all defensives, Nomura pharmaceutical analyst Amit Roy has reinforced his 12-month bearish outlook for European Union pharma as the industry continues to struggle with a lack of alternatives to replace lost revenues with growth drivers like emerging markets (EM) slowing down post M&A, new products failing to penetrate their respective markets and ongoing pipeline failures.

Pipeline cracks need a long-term fix, says the analyst, telling investors “don’t buy now at the top.”