Global Healthcare Pharmaceuticals Back to School Kickstart 10 High Level Themes; Selectively Constructive

Equity Research 6 September 2026 | 7:11PM EDT

GLOBAL HEALTHCARE: PHARMACEUTICALS

Back-to-School Kickstart: 10 High-Level Themes; Selectively Constructive

The back-to-school backdrop for large-cap biopharma has been marked by ongoing Asad Haider, CFA | outperformance through the summer months and while recent moves through Goldman Sachs & Co. LLC

August’s thin trading volumes were likely exaggerated by positioning and narratives Salveen Richter, CFA | rather than fundamentals, we see the sector on fairly solid ground entering fall and Goldman Sachs & Co. LLC remain constructive, selectively. The S&P 500 Pharma Index is now up ~18% YTD (vs. S&P 500 +13%) following a non-linear but sustained rally that started late last year James Quigley | with multiple cross-currents proving to be tailwinds — including macro and Goldman Sachs International positioning alongside fundamental considerations evidenced by strong earnings Rajan Sharma execution, M&A momentum and, importantly for generalist sentiment, disruptive | practice-changing innovation trends representing category expansion in oncology Goldman Sachs International

treatment particularly (RVMD; MRK/MRNA). In US LC biopharma, almost every name Matt Dellatorre, Ph.D. | has now outperformed the S&P 500 on the year, underscoring a broad sector-level Goldman Sachs & Co. LLC re-rating underway — though performance in EU pharma has been far more uneven Nick Jennings given greater fundamental debates amidst more uneven clinical catalyst delivery | (Novartis’ HORIZON trial setback over the weekend adds to the list) and a perception Goldman Sachs & Co. LLC

of greater willingness of US companies to offset patent expiry risks through M&A. Jeff Su | Goldman Sachs & Co. LLC At a single stock level, the most notable narrative pivots through the summer have been, to the positive in MRK (best YTD performer, now +43% in 2026, on a growing appreciation of the post-LOE revenue trajectory) and VRTX (underwhelming competitor CF data removed an overhang into an eventful 2H+; was added to the CL), while AZN has become increasingly debated (media reports of potential interest in large M&A has put heightened focus on post 2030 LOEs rather than the near-term growth trajectory).

On the innovation theme, the market has significantly upgraded its view of personalized cancer vaccines following the recent MRK/MRNA melanoma immunotherapy data — we expect this theme to be a key focus in the sector this fall. On the flip side, the failure of Novartis/IONS HORIZON trial over the weekend is a major setback for the Lp(a) class in cardiovascular treatment, raising questions about programs from AMGN, LLY, etc. with readacross to NAMS and RPRX (see within). Fall will feature a clinical catalyst-rich period for several large caps, representing potential for volatility and idiosyncratic alpha generation.

Names we see as best positioned into the balance of this year include: JNJ, LLY, AMGN, RPRX (scope for upward topline revisions); MRK, TEVA, VRTX (on the event

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Goldman Sachs Global Healthcare: Pharmaceuticals

path), AZN (sector-best growth and pipeline not reflected in current valuation) andBayer (ongoing turnaround story). Names we view more cautiously given a higher-risk catalyst path include: Novartis, BMY and PFE.

10 High-Level Themes In Focus Exiting the Summer 1. Top Down Considerations. o Per our equity strategist, Ben Snider, from a top-down perspective, three key factors have been tailwinds for LC biopharma stocks in recent weeks and will factor into the direction of travel for the sector in the remainder of the year: the economy, earnings expectations, and the AI trade. First, LC biopharma…