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JPMorgan has identified four large-cap U.S. pharmaceutical stocks it expects to perform strongly in 2026, citing a favorable mix of easing regulatory pressures, solid fundamentals, and attractive valuations. According to the investment bank, large-cap biopharma stocks are positioned to outperform again in 2026, even after the sector already surpassed the S&P 500’s performance in 2025. JPMorgan believes the combination of lower policy risk, robust drug pipelines, and durable cash flows creates a compelling backdrop for continued gains, making the sector one of its preferred areas for investors heading into the next year.
Among its “favorite ideas,” JPMorgan ranks Eli Lilly as its top large-cap biopharma pick. The bank highlights exceptional demand momentum across Lilly’s obesity and diabetes franchises, driven largely by GLP-1 therapies. JPMorgan sees sustained volume growth, pricing resilience, and expanding indications supporting long-term upside. Confidence is also bolstered by Lilly’s strong execution in manufacturing scale-up and lifecycle management, along with a deep pipeline beyond metabolic diseases that helps reduce concentration risk. Recent positive Phase 3 results for Lilly’s oral weight-loss drug orforglipron further reinforce its growth outlook.
Gilead Sciences is viewed as offering a balanced risk-reward profile. JPMorgan points to stable HIV cash flows combined with gradually improving oncology prospects, particularly from Trodelvy. While growth may be slower compared to some peers, disciplined capital allocation and dividend support remain attractive for investors. Recent positive Phase 3 data for an investigational HIV combination therapy and pricing agreements with the U.S. government add to Gilead’s long-term visibility.
AbbVie is praised for executing a smoother-than-expected transition following Humira’s loss of exclusivity. Strong uptake of Skyrizi and Rinvoq is more than offsetting Humira erosion, supporting earnings durability and cash generation. Regulatory wins, including FDA approval for EPKINLY and positive reimbursement news for Skyrizi, reinforce confidence in AbbVie’s strategy.
Regeneron rounds out JPMorgan’s list, supported by its innovation-driven model and high-quality pipeline. While execution and clinical readouts remain key, JPMorgan believes Regeneron’s core franchises and pipeline optionality position it well for sustained performance into 2026.
