Pharma stocks are set to take off this year, says UBS' Michael Yee

Watch on YouTube ↗  |  January 08, 2026 at 16:01  |  2:31  |  CNBC
Speakers
Michael Yee — Senior Pharma and Biotech Analyst, UBS

Summary

Michael Yee, UBS global head of biotechnology research, tells CNBC's Squawk on the Street that he is bullish on pharma and biotech stocks for the year. He highlights accelerating M&A, a passing drug-pricing overhang, and a favorable setup for Eli Lilly and upgraded Bristol-Myers. Yee also sees a green light for biotech consolidation in 2026 and identifies cardio-metabolic/obesity, cardiovascular, and oncology as key areas of large-pharma M&A interest.

  • UBS' Michael Yee is bullish on pharma and biotech for the year.
  • He says M&A activity is accelerating, with Lilly and other large pharma acquiring smaller biotechs.
  • Yee is bullish on Eli Lilly and says UBS upgraded Bristol-Myers.
  • He expects biotech consolidation to pick up in 2026, helped by drug-pricing visibility, lower rates, FTC deregulation, and patent cliffs.
  • He sees cardio-metabolic/obesity, cardiovascular, and oncology as top M&A target areas.
  • The segment cites the recent Lilly/Ventrix deal and a GLP-1 bidding war as evidence of active dealmaking.
Ideas
Michael Yee Senior Pharma and Biotech Analyst, UBS 0:44
Pharma stocks set to take off.
Pharma stocks are set to take off this year as M&A activity accelerates and the drug-pricing overhang passes, making it a good year for the group.
XPH HIGH
Michael Yee Senior Pharma and Biotech Analyst, UBS 0:48
Bullish Lilly on obesity pipeline deals.
UBS is bullish on Eli Lilly because it has roughly $100 billion of obesity revenue potential over the next 5-10 years and will keep doing deals to build an early-stage pipeline.
LLY HIGH
Michael Yee Senior Pharma and Biotech Analyst, UBS 0:51
Upgraded Bristol-Myers as overhang passes.
UBS upgraded Bristol-Myers, which has had a tough past 3-4 years and is ready to take off as M&A improves and the drug-pricing overhang passes.
BMY HIGH
Michael Yee Senior Pharma and Biotech Analyst, UBS 0:53
Biotech ready to take off.
Biotech is ready to take off after a tough past 3-4 years, helped by M&A and the passing drug-pricing overhang.
XBI HIGH
Michael Yee Senior Pharma and Biotech Analyst, UBS 1:23
Biotech M&A green light accelerates.
Large pharma including Lilly and AbbVie are set to pick off smaller biotechs, and consolidation should pick up in 2026 as FTC deregulation, lower rates, greater drug-pricing visibility, and 2028-29 patent cliffs create a green light for M&A; small companies near approval without sales forces are targets.
Smaller biotechs HIGH
Michael Yee Senior Pharma and Biotech Analyst, UBS 1:34
Obesity, cardiovascular attractive for M&A.
Cardio-metabolic/obesity and cardiovascular disease are key M&A areas for large pharma; Pfizer and Novo Nordisk's bidding war for a monthly GLP-1 injection and cardiovascular disease being part of a recent transaction show strong appetite.
OZEM Cardiovascular disease MED
Michael Yee Senior Pharma and Biotech Analyst, UBS 1:45
Oncology demand for next big drug.
Oncology is a favored M&A area because every large pharma wants the next $5 billion cancer drug.
Oncology MED
Up Next
6:10
TERRAS RARAS: A ARMA SECRETA QUE COLOCOU O BRASIL NA MIRA DE TRUMP
Market Makers · Jan 08
3:24
65% of agents expect housing market to improve: CNBC Housing Market Survey
CNBC · Jan 08
1:23
Zcash Plunges Over 16% as ECC Team Resigns
CoinDesk · Jan 08
45:46
Jim Bianco Explains Why 2026 Marks the End of the Old Economic Playbook
Milk Road Macro · Jan 08
4:05
The U.S. also needs to rebuild its power grid — not just Venezuela: Rebecca Patterson
CNBC · Jan 08

This CNBC video, published January 08, 2026, features Michael Yee discussing XPH, LLY, BMY, XBI, Smaller biotechs, OZEM, Cardiovascular disease, Oncology. 7 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Michael Yee  · Tickers: XPH, LLY, BMY, XBI, Smaller biotechs, OZEM, Cardiovascular disease, Oncology