Lack of products affects pharmaceutical stocks

Pharmaceutical companies are not investing enough in research and development and as a result have few new drugs in the pipeline with top line growth on average between 5%-6. A few years ago companies in the sector enjoyed growth of around 10%. Gartmore is underweight in the sector with around 6.5% exposure, whereas the index figure is 9. Guillaume Rambourg, investment manager at Gartmore, said: "There is a lack of new products appearing on the market and many existing ones are approaching their expire dates, when the company loses its patent for the drug. Also, governments are reducing s...