At its Sept. 16 meeting, the Fed raised rates, and Chair Kevin Warsh said inflation “is too high and has been for too long.” The article reads his remarks as implying further hikes and elevated rates, which could pressure big pharma dividends as Treasuries compete for income.
A 10-year U.S. Treasury yielded 5.17% on Sept. 24, compared with forward yields of 6.1% for Pfizer, 4.1% for Bristol Myers Squibb and 2.6% for AbbVie. The article notes Treasury coupons are fixed, while company dividends can change. Bristol Myers Squibb raised its quarterly payout to $0.63 per share in January 2026; Pfizer’s payout had remained $0.43 since early 2025 as pandemic-product sales shrank.
Stock performance also differed across the 2022–23 rate hikes: AbbVie gained 19% and Bristol Myers Squibb 15% in 2022 as Pfizer fell 13%; in 2023, Pfizer fell 44%, Bristol Myers Squibb 29% and AbbVie 4%. The article says company-specific pressures mattered more than rates, including declining pandemic sales at Pfizer, faster-than-expected generic erosion of Revlimid sales at Bristol Myers Squibb and Humira’s first U.S. biosimilar competitor for AbbVie. It says AbbVie’s planned $2.9 billion in 2026 net interest expenses equaled 16% of its $17.8 billion in free cash flow in 2025.
