Warren Buffet’s conglomerate holding company Berkshire Hathaway Inc announced on Monday that it would be focusing its investment habits on four major pharmaceutical companies. This comes after the industry enjoyed positive press following the announcements of effective COVID-19 vaccine candidates from the likes of Moderna, Pfizer, and BioNTech.
James Armstrong, president of Henry H. Armstrong & Associates in Pittsburgh which owns some of Berkshire, explained how the coronavirus pandemic has shifted people’s views about healthcare.
“The sector has become more efficient as big drug companies partner with smaller, inventive rivals,” he explained. “But you will always need companies with scale for manufacturing and distribution, including vaccines with global application.”
Pfizer is among the companies that Berkshire Hathaway has chosen to inject capital into, with $136 million being allocated to the pharmaceutical manufacturer. The other companies are Abbvie Inc, Bristol-Myers Squibb Co, and Merck & Co. Berkshire is expected to spend $1.8 billion on each of these companies.
This shift in focus from Berkshire comes unexpectedly given the conglomerate’s focal area during Q3. It forked over a $276 million investment in cellular phone company T-Mobile US Inc., while also choosing to buy more stocks in the Kroger supermarket chain.
