The Covid-19 pandemic has brought the large-pharma industry's defensive nature to the fore. Novo Nordisk and Eli Lilly are the least-affected, given most of their revenue is generated from self-administered drugs. As for four large-pharma companies that reported earnings as of April 27, all four beat sales and EPS estimates and maintained their 2020 guidance ranges. The worst-affected business area has been J&J's medical devices, given the collapse in elective surgeries, while the company's consumer health business, and that of Sanofi, has benefited from "pantry filling." According to Bloomberg Intelligence analysts, GlaxoSmithKline, Merck and Pfizer's vaccine franchises will suffer, as will consumer-health businesses. Bristol-Myers Squibb and Merck & Co. could be the most exposed to the Covid-19 outbreak, based on Bloomberg Intelligence analysis. New drugs that need heavy promotion and marketing, including medical conferences, are expected to have slower growth in 2020. Meanwhile, companies with consumer health products, especially cold and flu as well as pain relievers, and vaccine manufacturers, in particular those with influenza vaccines, may see increased demand for their products. Bristol-Myers Squibb, Eli Lilly and Novo Nordisk have the highest potential exposure to the impact of Covid-19 from curtailed promotional activities, including canceled medical conferences. Bristol-Myers' exposure comes mostly from Opdivo, given the intense competition from Merck and Keytruda's significant lead. Merck is most exposed to patient access to hospitals. Merck, Bristol, AstraZeneca and Roche are most exposed to the coronavirus outbreak curbing patients' drug access, Bloomberg Intelligence analysts suggest. The period of social distancing, self-isolation and reduced access to health-care facilities is likely to have hindered those drugs requiring administration by a health-care professional. Meanwhile, companies with mostly oral products driving growth, such as Pfizer (with Ibrance and Elqiuis) will be less affected. The lack of access to physicians is also hampering Glaxo, Merck, Pfizer and Sanofi vaccines businesses. Near-term drag is to China, one of pharma's key growth platform. China is the second-largest drug market globally, and coronavirus pandemic poses a near-term headwind that may have affected all activity in the region in 1Q, though reopening will ease the pressure from 2Q. AstraZeneca has the highest drug sales in China, which accounts for about a fifth of its revenue. Astra, like Merck, is being driven by novel cancer therapies, with Merck also benefiting from Gardasil uptake. Consumer health, vaccines provide resilience during pandemic. It is believed that consumer-health units can provide not only a relatively stable base, but also potential upside for companies with cold and flu remedies, as well as general wellness products, such as vitamins. This is in-line with what Johnson & Johnson and Sanofi said in their 1Q update. Vaccine manufacturers, especially Glaxo and Sanofi with flu vaccines, will likely see robust business in 2H20, given the heightened awareness brought on by Covid-19. All vaccine manufacturers, except Merck, are working on SARS-cov-2 vaccines. Covid-19 drag could shave 3.3% from 2023 pharma sales. Bloomberg Intelligence analysts suggest a 3.3% reduction to aggregate 2023 sales, with Novartis likely to be hardest hit. This is based on various assumptions of reduced promotional activity, impeded access to hospital drugs and delays in important clinical trials. Bayer and Johnson & Johnson should be the least impacted, though this is mostly a reflection of their diversified businesses. Novartis, Novo Nordisk and Eli Lilly are set to be affected most, with much of the former's sales growth dependent on new drugs or recently launched products - which need a lot of promotion. The latter issue should also influence Lilly - with tirzepatide, mirikizumab and selpercatinib - and Novo, with Rybelsus. Bristol, Novartis PDUFAs are most exposed to Covid-19 delay. Travel restrictions are likely to impede the FDA's ability to complete site visits at the dates required for new drug approvals under the Prescription Drug User Fee Act (PDUFA), with Bloomberg Intelligence’s analysis suggesting Bristol-Myers Squibb will be affected most. Bristol-Myers' BB2121 and JCAR017 - with PDUFA dates in 2H - are likely threatened, while Lilly and Pfizer's tanezumab December PDUFA looks vulnerable too. Bloomberg Intelligence analysts also believe Novartis may face delays to the approvals of capmatinib and inclisiran, acquired through its Medicines Company purchase. Sanofi's BIVV-009 is also menaced. Robust gains in China likely sustained, but coronavirus still is a risk. Merck should sustain longer term double-digit gains in China driven by cancer drugs, Gardasil and Januvia, despite some short term effect from the coronavirus disruption. Keytruda will benefit from use in first-line lung cancer and could accelerate if broad reimbursement is secured. Eli Lilly gains are fueled by Tyvyt, which is the only PD-1 drug on the NDRL, while Trulicity, Taltz and Olumiant will help sustain momentum. With Tresiba and Victoza both on the NDRL, and a likely 2021 approval of Ozempic, China is a key driver for Novo. Roche faces biosimilar drags, which will be outweighed by recent launches. These include Tecentriq in liver cancer - highly prevalent in China. Cancer and respiratory drugs support Astra's gains, where further near-term approvals and launches are due. Vaccines businesses are facing both positives and negatives. Covid-19 pandemic is significantly increasing the attention on vaccines. The public, knowing the mortality rate of flu infections, is likely to drive higher demand for these products in the coming winter. The problem for Sanofi and GlaxoSmithKline, the two large pharma companies with a flu-vaccines business, both face supply constraints. While Glaxo's shingles vaccine Shingrix and Merck's cervical cancer vaccine Gardasil may see a negative impact in the interim due to the impaired access to physicians, a lack of supply remains the longer-term problem. The short-term drag in the U.S. and Europe for both products may be reduced by increased demand in China. Pfizer's Prevnar, used to prevent pneumonia, after a short term boost, is now suffering. Sanofi's travel vaccines are also falling. Consumer-health business will suffer longer term. While there's potential for a short-term boost to large pharma companies' consumer health-care (CHC) businesses from Covid-19, the longer-term disruption from a serious economic recession will slow growth, Bloomberg Intelligence analysts believe. A decline in CHC sales will be tough for Glaxo, Pfizer and Sanofi. Animal-health sales are somewhat exposed to recessions. A recession and associated unemployment levels that follow the Covid-19 outbreak will likely lead to reduced demand for animal protein, which will affect livestock numbers and the animal-health businesses tied to them. The impact is likely to be manageable, however, as seen during previous recessions. Companion businesses tend to suffer less since pet owners rarely cut back on treatments. Short-term concerns related to lockdowns in many cities are also unlikely to adversely affect this segment, as veterinary practices are open for emergencies. AbbVie, GlaxoSmithKline, Pfizer shine on dividend yields. Pharma cash flows are expected to remain robust enough for most companies to keep paying dividends. The ones at most risk, based on their dividend coverage, are AstraZeneca, Sanofi and Bayer. AbbVie, Glaxo and Pfizer in particular are the highest-yielding large-pharma companies with coverage ratios above 1. At the other end of the scale, Eli Lilly and Novo Nordisk have the lowest dividend yields. Bayer's dividend is most exposed if cash flow stalls. Many, but not all, pharma companies have strong enough balance sheets to be able to raise more debt to service their dividends if cash flow is pressured by the effects of the coronavirus pandemic. The weakest of the top 13, according to Bloomberg Intelligence analysts, which assumes a target leverage ratio of 2.5x total debt-to-consensus 2020 Ebitda - are GlaxoSmithKline, Bayer and AstraZeneca. Amongst these three, if business activity falls 10% due to the impact of the coronavirus, Bloomberg Intelligence analysts see Bayer and Glaxo being most exposed, unless they are prepared to raise their leverage ratios. Coronavirus risks to large pharma are manageable. There are four ways in which public measures in response to the coronavirus could impact large-pharma companies, Bloomberg Intelligence analysts believe. Firstly, when the virus was limited to China, companies such as AstraZeneca - with the highest direct sales exposure (17% in 2019) in the region - faced most risk. Secondly, with broader spread, supply-chain disruptions have not impacted ability to supply drugs to date. As patients will need to continue to take their medication, it can be assumed that the global community will continue to prioritize drug access despite travel restrictions. The third effect is a delay in drug approvals and FDA inspections. The depth of the damage will depend on how long the U.S. travel ban lasts. Lastly, reduction in doctor office visits and access to infusion centers/hospitals has slowed growth in some drugs.