Citi has launched coverage of what it calls the "Big 6" European pharmaceutical companies, assigning Buy ratings to AstraZeneca (LON:AZN), Novartis AG (SIX:NOVN) and Roche (SIX:ROG), and Neutral ratings to GSK (LON:GSK), Sanofi (EPA:SASY) and Novo Nordisk (CSE:NOVOb). The bank identifies AstraZeneca and Novartis as its top picks among the group.
Sector outlook and growth expectations
In its initial coverage, Citi takes a positive stance on the pharmaceutical sector, citing innovation and a notably full late-stage development pipeline as the key drivers. The bank's forecast calls for average earnings per share growth of 7% in 2026 and an 8% compound annual growth rate through 2030, supported by new product introductions that Citi says should largely counteract revenue losses from patents expiring.
"Despite its increasing revenue base and pricing and access headwinds, demand for new innovative products that improve patient outcomes and address unmet medical needs continues," Citi analysts led by Graham Parry said. "We see the sector continue to drive growth with new launches mostly able to offset loss of patent protection."
Citi quantifies the sector's late-stage opportunity, noting the combined pipeline carries $167 billion in risk-adjusted peak sales potential. That figure sits well above the roughly $93 billion of revenue the bank models as being lost to loss of exclusivity by 2034.
Catalyst calendar and policy context
The analysts highlight 2026 as a particularly busy year for catalytic events, pointing to a large number of Phase III data readouts across major therapeutic areas. Citi singles out AstraZeneca and Novartis as beneficiaries of that dense readout schedule.
On the regulatory and policy front, Citi says some uncertainty has eased after most favored nation pricing agreements with the U.S. administration late last year. The bank views those developments as having reduced tariff and drug pricing uncertainty for most companies in the group.
Why the Buy ratings
Within the Buy cohort, Citi portrays AstraZeneca as the most compelling long-term growth story, underscoring what the analysts describe as "by far the best R&D pipeline in the sector." The bank points to a heavy cadence of late-stage trial results and cites more than $30 billion in unadjusted peak sales potential tied to the company's late-stage programs.
Novartis is characterized as a "serial earnings outperformer." Citi expects Novartis to exceed consensus sales growth, driven by traction from both approved products and late-stage assets. The bank notes: "We expect Novartis to achieve its 4-5% 25-30E sales guidance, beating consensus 3.5-4.0% and seeing our 30E forecasts 7-8% above consensus."
Roche's Buy recommendation rests on what Citi calls an improving pipeline, led by giredestrant in breast cancer and fenebrutinib in multiple sclerosis, along with "8 new PIII starts with $23bn peak sales potential."
Reasons for Neutral ratings
On the Neutral side, Citi points to specific company-level constraints. For GSK, the bank says operational improvements and new launches do not fully counterbalance a sizeable loss of exclusivity expected in its HIV franchise later in the decade.
Sanofi's Neutral rating reflects the analysts' view that the stock's current valuation already incorporates a series of pipeline setbacks observed over the past year.
For Novo Nordisk, Citi flags multiple near-term headwinds on pricing, access and competition, despite early strength in prescriptions for the company's oral Wegovy launch.
The broader takeaway from Citi's debut coverage is a cautiously optimistic view of the European pharmaceutical sector: structurally driven growth from innovation and a deep late-stage program underpin the bank's forecasts, while company-specific risks tied to patent cliffs, pricing, access and competition shape relative ratings across the six names.