Goldman Sachs Picks Eli Lilly, J&J and Merck as Pharma Stocks Rally
Goldman Sachs analyst Asad Haider names his favorite large-cap pharma stocks and flags risks for biotech as yields rise, citing Barron's interview.
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what happened
Asad Haider of Goldman Sachs, speaking to Barron's in an interview conducted on October 14, keeps a moderately positive view of the pharmaceutical sector. He said the iShares U.S. Pharmaceuticals and iShares Biotechnology ETFs have gained 22% and 25% so far this year, ahead of the 13% rise in the S&P 500.
Among his leading ideas are Eli Lilly, Johnson & Johnson and Merck. Haider said Lilly interests him beyond its obesity and diabetes drugs, pointing to non-incretin programs with important trial readouts expected next year. He described J&J as having a strong commercial portfolio and pipeline, with its oral psoriasis pill Icotyde showing efficacy close to biologics. Merck, which faces loss of exclusivity on Keytruda in 2028, is strengthening its position through deals and oncology data, in his view.
why it matters
Two factors matter for the market: the Federal Reserve is in a rate-hiking cycle, and rising yields typically weigh on biotech, especially smaller companies valued on discounted cash flows. Haider also noted that AI-exposed tech stocks and healthcare stocks have shown a largely negative correlation, adding an unpredictable variable for investors.
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sources
- Why This Pharma Pro Likes Johnson & Johnson, Eli Lilly, and Merck Stock — Barrons.com, 21 October 2026 at 16:51 UTC
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