It is no secret that the human population has grown much older over the past thirty years. In fact, the global average age has consistently risen every ten years from 21.5 years in 1970 to 30.9 in 2020 due to a combination of decreasing birth rates and better longevity. And with the global average age projected to go up to 38.7 by 2070, this trend is one that is not going away soon.
How can investors use this unstoppable trend to their advantage? Since an aging population will most likely need more prescription drugs, I think that these two dividend-paying biotech stocks are excellent picks for investors to purchase right now.
With the global medication industry expected to increase from $1.03 trillion in 2021 to $1.41 trillion by 2026, it will become more important for doctors, insurers and patients around the world to manage prescription drug prices. An increased emphasis on biosimilar and generic drugs to keep costs down should be favorable for biotech stock Viatris.
While 39% of its $13.5 billion in 2021 revenue has already came from biosimilar and generic drugs, this share will continue to increase in value even more in the coming years for two main reasons.The first reason is that Viatris drugs (like EpiPen, Lipitor, and Viagra) will likely have ongoing revenue reductions as they’ve been off patent for a while. Secondly, the Viatris is getting ready for a number of biosimilar and generic drug launches.
The largest selling point for the company besides its promising prospects and solid pipeline for biosimilars and generics is its really cheap valuation. Its forward price-to-earnings ratio of lower than four and 3% dividend price makes it a smart biotech stock purchase for patient income investors.
Investors might also want to consider buying Pfizer. Recently, this mega cap pharmaceutical stock is most known for the COVID-19 vaccine that it co-developed with BioNTech, known as Comirnaty, which it predicts will make up 44.2% of its $81.5 billion in forecast revenue in 2021.
Yet Pfizer still is far more than its COVID-19 vaccine. The company produced a 7% year-over-year increase just in the third quarter of this year, led by the blood thinner drug Eliquis and the rare heart disease drugs Vyndamax and Vyndaqel, which points to a powerful portfolio overall.
Second, Pfizer’s oral pill, known as Paxlovid, that is used to treat the covid virus, stopped clinical trials early because of its successful results; it lowered the risk of death or hospitalization among patients with a chance of developing severe covid by 89%. This will most likely give Pfizer a major therapy when the FDA provides Emergency Use Authorization, which might be just months away.
Author: Blake Ambrose