Believe it or not, the year is close to halfway over, and it’s been a busy one for pharmaceutical companies, to say the least.
So far this year, drugmakers have released two quarters’ worth of earnings, and they’ve covered everything from GLP-1 sales to Medicare Part D changes to tariffs.
Here’s a half-time earnings roundup in case you need to catch up.
Ups and downs
The only way to describe Q4 2024 earnings, which were reported in January and February, is mixed bag. Many pharma companies performed better-than-expected in some parts of their businesses but worse-than-expected in others.
On Feb. 4, Merck, for example, reported revenue higher than analysts had projected, bringing in $15.6 billion compared to the expected $15.5 billion, CNBC reported. However, the drugmaker has projected it will bring in $64.1 billion to $65.6 billion for 2025, which is just under the $67.3 billion analysts were expecting, according to CNBC.
Johnson & Johnson reported on Jan. 22 Q4 2024 sales had increased to $22.5 billion, up roughly 5% from $21.4 billion YoY. That was due largely to its oncology segment, which brought in $5.5 billion worldwide, a 19% increase over the prior year.
But EVP and CFO Joseph Wolk said during the earnings call that J&J expects changes to the Medicare Part D program—including a $2,000 cap on out-of-pocket spending—to have a roughly $2 billion negative impact on the company in 2025. Despite this, the company still expects a 3% sales growth this year, chairman and CEO Joaquin Duato said on the call.
And Eli Lilly reported on Feb. 6 better-than-expected overall earnings ($5.32 per share compared to the expected $4.95 per share), but worse-than-expected sales of GLP-1s Mounjaro and Zepbound, according to CNBC.
Mounjaro, Lilly’s Type 2 diabetes GLP-1, brought in $3.5 billion, though analysts had expected $3.6 billion, CNBC reported. And the drugmaker’s obesity GLP-1, Zepbound, brought in $1.91 billion while analysts had called $1.98 billion.
Homing in on tariffs
Q1 2025 results, which were reported in April and May, were heavily focused on tariffs and increasing US manufacturing efforts.
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Johnson & Johnson paved the way, saying in an April 15 earnings call the company expects about $400 million in tariff costs this year. Merck followed shortly after, announcing it expects a $200 million hit from tariffs.
Despite the anticipated losses, the drugmakers didn’t project much of an impact on future earnings. In fact, J&J raised its 2025 sales guidance to $91.6 billion–$92.4 billion up from the $90.9 billion–$91.7 billion announced in January. Merck maintained its expected 2025 sales guidance, but lowered its expected profit forecast to $8.82–$8.97 per share, down from $8.88–$9.03 per share.
And not all drugmakers reported anticipated losses from tariffs—CEOs for both Novo Nordisk and Eli Lilly said tariffs in place at the time of their earnings calls earlier this month wouldn’t materially impact their companies, yet warned potential pharmaceutical tariffs could.
Pharma companies also focused heavily on US manufacturing efforts.
AbbVie CEO Robert Michael said the company will spend $10 billion in the US to support “volume growth” and “expansion into new areas such as obesity.” The pharma giant plans to build four new manufacturing sites in the US to make active pharmaceutical ingredients, peptides, and devices, EVP and CFO Scott Reents said on the earnings call.
Merck chairman and CEO Robert Davis said the company will invest $9 billion in US manufacturing through 2028, adding that investments “are leading to more of our products for US patients being manufactured in the US as well as more opportunities for export.”