JPMorgan gave clients its favorite drug stock ideas based on the industry's recent product launches.
"On 2017, we see an upward bias to numbers on an operational basis based on the ongoing product cycle," analyst Chris Schott wrote in a note to clients Tuesday. "With President Trump's drug pricing commentary over the past few weeks, we have seen renewed investor focus on this topic. Nonetheless, we do not see any wholesale shift in the current healthcare market structure in the foreseeable future."
The analyst did cite the risk of a rising U.S. dollar, which may hurt drug companies as 55 percent of the industry's sales are international.
Here are three overweight-rated pharmaceutical companies JPMorgan recommends.