Pharmaceuticals: Asia marketing: Bearish mood persists; yields mark downside

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Pharmaceuticals: Asia marketing: Bearish mood persists; yields mark downside

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Pharmaceuticals

Asia marketing: Bearish mood persists;

yields mark downside

Industry Overview

22 June 2026

Pharma sentiment bearish; fund shifts, rates weigh Equity

We visited Asian investors in Hong Kong and Singapore on March 15-19. While Japanese Japan

equities have performed strongly, investors appear to view the pharma sector as a Pharmaceuticals

relative short candidate, and overall sentiment was predominantly bearish. We believe

this reflects: (1) investors’ preference to allocate funds to AI- and semiconductor-related KoichiResearchMameganoAnalyst >>

names, and (2) a market environment in which defensive stocks are less likely to be BofAS Japan

koichi.mamegano@bofa.com

favored amid changes in the interest-rate environment.

Takefumi Kobayashi >>

Recent weakness is pronounced; Santen offers stability ResearchBofAS JapanAnalyst

takefumi.kobayashi@bofa.com

Looking at sector performance over the past year, only three stocks — Astellas, Otsuka

and Sumitomo — have outperformed TOPIX. Over the past six months as well, many RitsuoResearchWatanabeAnalyst >>

stocks have underperformed TOPIX, suggesting that investor preference for the sector BofAS Japan

ritsuo.watanabe@bofa.com

remains weak overall. Within this context, Santen has traded relatively firmly throughout

the year, supported by the stability of its business and earnings.

Dividend yields may guide downside in a weak market

For the sector outlook, we believe stock selection will continue for the time being as the

impact of the macro environment and fund flows persists. We think Otsuka is likely to

attract interest for its earnings momentum and R&D catalysts, while Santen should