The Major Pharma Stocks That Are Making Short Sellers Sick

Health and Healthcare

Published: April 11, 2018 8:30 am

Last Updated: January 12, 2020 1:33 am

Pharmaceutical companies usually are involved in a lengthy process of getting their drug candidates to market through clinical trials. There is a fair amount of risk involved, should a study come back negative or a candidate not be approved. Conversely, if a drug gains FDA approval or passes a clinical trial, there can be big upside.

The White House has promised reforms in the health care sector, such as changing the bidding process for drugs and shortening the FDA approval process. It has yet to be seen how much headway they can actually make with these reforms.

Keep in mind that short sellers betting against big pharma are taking on an added risk. They have to pay out the ongoing high dividends on top of the cost of borrowing the shares.

The March 29 short interest data have been compared with the previous figures, and short interest in most of these selected pharmaceutical stocks decreased.

Short interest in Pfizer Inc. (NYSE: PFE) decreased to 98.32 million shares from the previous 142.88 million. The stock was last seen trading at $35.95, within a 52-week range of $31.67 to $39.43.

The number of Merck & Co. Inc. (NYSE: MRK) shares short increased to 23.67 million from 22.19 million in the previous period. Its shares were trading at $56.49, in a 52-week range of $52.83 to $66.41.

Teva Pharmaceutical Industries Ltd.’s (NYSE: TEVA) short interest decreased to 59.40 million from the previous level of 65.32 million. Shares were trading at $17.88, in a 52-week range of $10.85 to $33.82.

Bristol-Myers Squibb Co. (NYSE: BMY) short interest decreased to 11.14 million shares from the previous reading of 13.48 million. Shares were trading at $61.21, within a 52-week range of $51.56 to $70.05.

The number of shares short in AbbVie Inc. (NYSE: ABBV) decreased to 15.25 million, compared to the previous 15.90 million. The stock was trading at $93.62, in a 52-week range of $63.12 to $125.86.

Eli Lilly and Co.’s (NYSE: LLY) short interest decreased to 10.53 million shares from the previous 14.33 million. The stock was trading at $79.22. The 52-week range is $73.69 to $89.09.