In this article, we will take a look at some of the best dividend stocks.
Drug pricing has become one of the biggest pressure points for pharmaceutical companies this year, as the U.S. moves to rein in what consumers pay at the pharmacy counter.
For most drugmakers, the US is the largest single market. Prices there are often close to three times higher than in other developed countries. Branded medicines carry even steeper premiums. That gap explains why so much of the industry’s revenue still depends on American sales.
Donald Trump has pushed to lower drug prices through a so-called Most Favored Nations pricing model. Under that approach, US prices would be tied to the lowest levels paid by other wealthy countries. If implemented at scale, the impact on pharmaceutical balance sheets could be significant.
According to a report by CNBC, five of the 10 largest biopharmaceutical companies in the Stoxx 600 Health Care generate the majority of their total sales from the US. That exposure helps explain why pricing reform remains such a sensitive issue for the sector.
Market performance has held up so far. The S&P 500 Health Care is up more than 13% this year. Bloomberg reported that in the third quarter of 2025, health-care companies led all 11 S&P 500 sectors in earnings beats. It marked the industry’s strongest quarter in more than four years.
In an interview, Kevin Caliendo, senior health-care analyst at UBS, said that looking ahead, attention will shift to how pharmaceutical companies adjust now that drug pricing uncertainty has started to ease.
Given this, we will take a look at some of the best dividend stocks in the pharma sector.
Our Methodology:
For this article, we screened for pharma companies that develop, manufacture, and sell prescription drugs and vaccines. We also identified companies that offer contract manufacturing to other pharma and biotech companies. From that list, we picked 14 companies that were most popular among hedge funds, as per Insider Monkey’s database of Q3 2025, and ranked them accordingly.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
14. Viatris Inc. (NASDAQ:VTRS)
Number of Hedge Fund Holders: 55
Dividend Yield as of December 29: 3.87%
Viatris Inc. (NASDAQ:VTRS) is among the best dividend stocks from the pharma sector.
On December 9, Barclays analyst Glen Santangelo initiated coverage of Viatris Inc. (NASDAQ:VTRS) with an Overweight rating and a $15 price target. The firm launched coverage of the specialty pharmaceuticals industry with a neutral view, noting that investor sentiment is starting to improve as companies place more emphasis on innovation, margin expansion, and de-leveraging. In a research note, the analyst said pricing pressure across the group is easing, while debt leverage is moving lower. Barclays sees “plenty of opportunity” in the space, adding that the sector “remains in a transition phase.” That transition, in the firm’s view, is beginning to show through both balance sheets and operating focus.
Earlier in December, Viatris Inc. (NASDAQ:VTRS) announced it had entered into definitive agreements with Biocon Limited to sell its equity stake in Biocon Biologics Limited. Under the terms, Biocon will acquire all of Viatris’ convertible preferred equity in Biocon Biologics for total consideration of $815 million. The transaction includes $400 million in cash and $415 million in newly issued equity shares of Biocon.
Scott A. Smith, Chief Executive Officer, Viatris, made the following statement:
“This agreement is another important step in Viatris’ evolution. Monetizing the value of our equity stake in Biocon Biologics and regaining access to the biosimilars market globally provides significant additional optionality as we continue to build a portfolio of generics, established brands and innovative brands that can contribute to our future growth.”
Citi is acting as financial advisor to Viatris. Cravath, Swaine & Moore LLP and Indian law firm Khaitan & Co. are serving as legal advisors to the company.
Viatris Inc. (NASDAQ:VTRS) is a global pharmaceutical company that provides a wide range of medicines, including generics, branded drugs, biosimilars, OTC products, and active pharmaceutical ingredients (APIs).
13. Gilead Sciences, Inc. (NASDAQ:GILD)
Number of Hedge Fund Holders: 61
Dividend Yield as of December 29: 2.54%
Gilead Sciences, Inc. (NASDAQ:GILD) is one of the best dividend stocks to invest in.
On December 29, Gilead Sciences, Inc. (NASDAQ:GILD) announced an agreement with the US government aimed at lowering drug costs for Americans. The move reinforces the company’s long-standing focus on US-based innovation, affordability, and global health leadership.
Under the three-year agreement, Gilead agreed to all requests by President Trump to adopt a new pricing strategy that prioritizes American patients. The goal is to ensure the US no longer carries a disproportionate share of global healthcare costs. The agreement also supports America’s role in global health and biomedical innovation. It builds on Gilead Sciences, Inc. (NASDAQ:GILD)’s recently announced partnership with the US Department of State to provide its breakthrough HIV prevention medicine, lenacapavir, at no profit to up to two million people in the countries most affected by the disease over the next three years.
Daniel O’Day, Chairman and Chief Executive Officer, Gilead Sciences, made the following statement:
“This agreement reflects a foundational commitment to both affordability and future innovation, a commitment that we have long seen as essential to shaping the future of healthcare. The progress toward expanding access and increasing investment in U.S. innovation will meaningfully contribute to America’s health and economic priorities. Gilead Sciences will continue to work with the Administration in service of these priorities for the benefit of generations to come.”
Alongside these efforts, Gilead Sciences, Inc. (NASDAQ:GILD) recently said it plans to invest $32 billion in US-based manufacturing, research and development, and infrastructure over the next five years. The company expects this investment to generate $43 billion in national economic value and create more than 3,000 direct and indirect jobs.
Gilead Sciences, Inc. (NASDAQ:GILD) is a major biopharmaceutical company that researches, develops, and sells innovative medicines, with a focus on treating life-threatening diseases.
12. Amgen Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 62
Dividend Yield as of December 29: 3.05%
Amgen Inc. (NASDAQ:AMGN) is among the best dividend stocks to invest in.
Amgen Inc. (NASDAQ:AMGN) has outperformed the broader market this year, supported by strong financial results and steady clinical progress, even as investors keep an eye on upcoming patent expirations. The stock is up more than 27% since the start of 2025.
In the third quarter, revenue rose 12% from a year earlier to $9.6 billion. Several of the company’s key growth drivers delivered solid numbers. Repatha, a treatment for high cholesterol, generated $794 million in sales during the period, a 40% increase from the prior year. Tezspire, Amgen’s asthma therapy, posted revenue of $377 million, also up 40% year over year.
Growth may slow over the next few quarters as biosimilar competition for denosumab, a bone-health drug sold under the Prolia and Xgeva brands, begins to gain traction. That pressure is real, and it is already on investors’ radar. Amgen Inc. (NASDAQ:AMGN) still has multiple ways to offset that impact. Several existing products continue to offer years of sales growth, and the pipeline remains active. One of the more closely watched programs is MariTide, a long-acting investigational treatment for weight management. The company has moved MariTide into phase 3 studies across obesity, type 2 diabetes, and other conditions.
Steady financial performance and an ability to refresh its pipeline support Amgen’s dividend outlook. The company has raised its dividend every year since initiating the program in 2011. The stock now offers a forward yield of about 3%, compared with the S&P 500 average of roughly 1.2%. With a cash payout ratio near 46%, there is still room for further increases.
Amgen Inc. (NASDAQ:AMGN) is a leading global biotechnology company that discovers, develops, manufactures, and delivers innovative medicines for serious illnesses.
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