Big pharmaceutical companies have been beaten down by worries over patent expirations, a lack of new products and low price-to-earnings ratios. But health care strategists aren't all pessimistic.
"History would demonstrate that in fact these companies will again come up with new products," Barbara Ryan, senior pharmaceuticals analyst at Deutsche Bank, told CNBC Tuesday.
"The focus is on those companies today that have the right strategies, are addressing the challenges on their top line with radical restructuring of the cost base, and have a pipeline that looks like it could power another leg up for the group," Ryan said.
Bristol-Myers and Merck are two companies "strategically doing the right things" and they have an "arsenal of new products," she said. Ryan also likes Pfizer.
Les Funtleyder, health care strategist at Miller Tabak, is focused on "pipeline stories" in big pharmaceuticals as well.
"Some of the other pharmaceutical companies, they are a little early in their restructuring and we don’t have the visibility we’d like," he told CNBC.
Les Funtleyder's picks:
Scorecard: What They've Said:
- Deutche Banks's Barbara Ryan on CNBC (July 9, 2010)
- Miller Tabek's Les Funtleyder on CNBC (July 7, 2010)
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Barbara Ryan of Deutsche Bank, and her family, do not own Pfizer or Merck. Ryan has family members who own Bristol-Myer. Deutsche Bank owns Bristol-Myer and Pfizer, and has investment banking relationships with all three companies.
Les Funtleyder and his company do not have any conflicts with Bristol-Myer, Merck and Pfizer.