Government deals lift overhang on pharma group, says BofA

BofA says Friday’s U.S. Government deals with big pharmaceutical companies were generally in-line with prior updates and provide a three-year tariff reprieve in exchange for certain drug price concessions and other conditions, adding that it believes the net price concessions “look manageable.” The firm, which sees the deals as “largely an overhang-lift,” argues that this sentiment appears to be shared by the market given the positive move in the DRG pharma index in recent days. Publicly traded large cap drugmakers include AstraZeneca (AZN), Bristol Myers (BMY), Eli Lilly (LLY), GSK (GSK), Johnson & Johnson (JNJ), Merck (MRK), Novartis (NVS), Pfizer (PFE), Roche (RHHBY) and Sanofi (SNY).