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Drugmakers show recovery in Q3 as COVID-19 touches all aspects of business

Pharmaceutical and biotech companies demonstrated their ability to weather the storm of the COVID-19 pandemic in the third quarter of 2020, but the public health crisis took a toll on aspects of the sector that require face-to-face interaction.

Large U.S. drugmakers in particular beat analyst consensus expectations in the third quarter with only Eli Lilly and Co. missing forecasts due to lower sales of diabetes drug Trulicity and higher costs associated with COVID-19 research.

European companies Novo Nordisk A/S and Bayer AG and U.K. pharmaceutical giant AstraZeneca PLC also missed analyst predictions with product sales dipping due to the COVID-19 pandemic.

But many of the largest U.S. companies like Johnson & Johnson, Pfizer Inc., Merck & Co. Inc., AbbVie Inc., Amgen Inc. and Bristol-Myers Squibb Co. saw a recovery in their core businesses as the pharmaceutical industry poured effort into treatments and vaccines for the infection.

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Companies like Gilead Sciences Inc. and Regeneron Pharmaceuticals Inc. banked on early successes with antiviral drugs that demonstrated efficacy against COVID-19, even as clinical trials faltered in October.

Delays in new starts for key drugs like AstraZeneca's Pulmicort, for example, which is administered in the hospital, gave revenue a hit. Similarly, healthcare equipment companies and medical device businesses were brought down by decreased hospital use due to social distancing restrictions.

Large companies like J&J and Bristol-Myers were more resistant to negative effects from the pandemic. J&J saw stability in major products and the diversity of its business, making up for losses in the company's medical device arm.

Bristol-Myers, fresh from the $95 billion acquisition of Celgene, also took comfort in a diverse set of products and a deep pipeline that analysts said would help to overcome upcoming competition to cancer drug Revlimid. But Bristol-Myers felt the pandemic's impact in the form of delayed regulatory action for the cell therapy liso-cel because pivotal inspections to several manufacturing plants had to be postponed due to travel restrictions.