Q2 2020 Revenue Declines for Seven Multinational Pharma Companies Amid Pandemic and Portfolio Shifts

　　【Pharmaceutical Network - Industry Trends] July and August mark the intensive disclosure period for listed companies’ second-quarter earnings reports. According to incomplete statistics, more than 10 multinational pharmaceutical companies have released their Q2 financial reports so far, including Johnson & Johnson, Bayer, Sanofi, Novartis, Merck & Co., and AstraZeneca. In terms of performance, the results for Q2 2020 show a divergent trend among multinational pharmaceutical firms: six companies, including Roche, experienced a decline in revenue, while others, such as AstraZeneca, maintained positive growth.
 

　7 Multinational Pharmaceutical Companies Report Declining Revenue
 

The seven multinational pharmaceutical companies are Roche, Johnson & Johnson, Merck & Co., Bayer, Pfizer, Novartis, and Sanofi. Among them, Roche’s second-quarter revenue declined by 4% year-on-year, primarily due to the impact of the pandemic. In contrast, Roche maintained a 7% revenue growth in the first quarter. The company expects its full-year 2020 performance to achieve mid-to-low single-digit growth.
 

Johnson & Johnson reported second-quarter sales of $18.3 billion, a year-on-year decrease of 10.8%. By business segment, global operational sales of its MedTech business (excluding the net impact of acquisitions and divestitures) dropped by as much as 32.5%, driven by reduced utilization of interventional medical device solutions due to the pandemic. Additionally, sales in its Consumer Health segment also declined.
 

Merck & Co.’s recently released second-quarter 2020 financial report showed global sales of $10.9 billion, a year-on-year decrease of 8%. Excluding the impact of foreign exchange fluctuations, global sales declined by 5%. The company’s pharmaceutical business generated $9.7 billion in revenue, a 7% year-on-year decrease, primarily due to the impact of the pandemic and the ongoing effects of loss of market exclusivity for certain products.
 

Bayer released its Q2 2020 financial report on August 4, reporting group sales of €10.054 billion, a year-on-year decrease of 2.5%. Sales in both the Pharmaceuticals and Consumer Health divisions declined, falling by 8.8% and 1.9% respectively, while the Crop Science division maintained positive growth of 3.2%. Although the primary reasons for the revenue decline in the second quarter were the pandemic and the volume-based procurement policy, Bayer still achieved robust performance in the first half of the year, with group sales reaching €22.899 billion, a year-on-year increase of 8.4%.
 

Pfizer reported second-quarter revenue of $11.8 billion, an 11% year-over-year decline, primarily due to the sale of its consumer healthcare business to GSK. The company forecasts full-year revenue to range between $48.6 billion and $50.6 billion.
 

Novartis reported declines in both second-quarter sales and net profit, with net profit falling 4% to $1.9 billion. Sales decreased by 1% to $11.35 billion on a constant-currency basis. Novartis also lowered its 2020 sales guidance, projecting only mid-single-digit growth. Meanwhile, the company narrowed its operating profit guidance range, forecasting low-double-digit growth in core operating profit.
 

Sanofi’s net sales in the second quarter amounted to €8.207 billion, representing a year-on-year decline of 3.4% at constant exchange rates. Sales across its three major business segments—Vaccines, General Medicines, and Consumer Healthcare—all decreased, with year-on-year declines of 6.8%, 12.7%, and 8.0%, respectively.
 

　　AstraZeneca and Others Maintained Positive Growth in Performance
 

Multinational pharmaceutical companies maintaining positive growth in the second quarter include AstraZeneca, Amgen, and AbbVie. Among them, AstraZeneca’s second-quarter financial report revealed a surge in net profit. For the second quarter ended June 30, AstraZeneca reported a net profit of $756 million, compared to $130 million in the same period last year; sales increased by 8% to $6.28 billion, exceeding market expectations. The company’s core product lines are currently performing well, and it is expected to maintain growth for the third consecutive year.
 

Amgen’s Q2 2020 financial report showed operating revenue of $6.2 billion, a year-on-year increase of 6%, with product sales amounting to $5.9 billion, also up 6%; profits were $1.8 billion, down 17%. Meanwhile, Amgen reaffirmed its full-year revenue outlook, expecting it to be between $25 billion and $25.6 billion. Additionally, AbbVie reported net revenue of $10.425 billion in the second quarter, representing a 26.3% year-on-year growth.