The R&D Index for the week ending February 8, 2019 closed at 4,235.74 for the 25 companies in the R&D Index. The Index was down -1.49% (or -60.34 basis points) from the week ending February 2, 2019. The stock of 11 R&D Index members gained value from 0.23% (Intel) to 4.82% (GlaxoSmithKline). The stock of fourteen R&D Index members lost value from -0.21% (General Motors) to -9.79% (Daimler).
China’s top electric vehicle (EV) battery maker Contemporary Amperex Technology (CATL) and R&D Index member Honda signed a memorandum of understanding (MOU) last week to cooperate on jointly developing lithium ion batteries for electric vehicles. CATL stated that it would supply 56 gigawatt hours of batteries to Honda by 2027 and set up an office near Honda’s research unit outside Tokyo. They also could supply some batteries for Honda’s North American market. Honda also is in talks with Panasonic for batteries. CATL also supplies batteries to BMW, Volkswagen, Nissan and SAIC Motors Corp.
R&D Index member Sanofi announced last week that it is reprioritizing its $7 billion R&D budget through 2021. It has stopped work on 13 projects in development and another 25 in research and will instead focus on more promising experimental drugs in immunology, oncology and rare blood disorders. They also noted that the company expects to become less dependent on external partners, particularly following its buyouts last year of Bioverativ and Ablynx. Sanofi’s pipeline cuts reflect its commitment to a more focused drug development portfolio. Sanofi expects to submit 9 new medicines and 25 additional indications for regulatory approval by 2022. The company also plans to employ new data science and machine learning techniques to generate higher quality data, accelerate development submissions and reduce costs.
The Federal Reserve system last week announced a new set of stress tests for banks that imagines a 6-point increase in unemployment to 10%, along with stress tests in corporate lending and commercial real estate markets.
R&D Index member Google/Alphabet announced its 2018 4Q results last week with the following data: revenue grew 22% year-over-year to $39.3 billion, its R&D budget grew 40% year-over-year to $6 billion and its capital expenditures grew by 64% to $7.1 billion. These spending increases cut into Google’s growth expectations and worried some investors.
| R&D Index Week Ending February 8, 2019 |
| Ticker | Exchange | 2018 R&D millions U.S. $ | 02/01/19 | 02/09/19 | 2/9/19 to 2/2/19 | 2/8/19 to 12/31/18 | ||
| 1 | Amazon | AMZN | NASDAQ | 26,750 | 1,626.23 | 1,588.22 | -2.34% | 5.74% |
| 2 | Alphabet/Google | GOOGL | NASDAQ | 18,796 | 1,118.62 | 1,102.38 | -1.45% | 5.49% |
| 3 | Apple | AAPL | NASDAQ | 14,037 | 166.52 | 170.41 | 2.34% | 8.03% |
| 4 | Intel | INTC | NASDAQ | 13,702 | 48.73 | 48.84 | 0.23% | 4.07% |
| 5 | Microsoft | MSFT | NASDAQ | 13,558 | 102.78 | 105.67 | 2.81% | 4.04% |
| 6 | Roche Pharm | RHHBY | OTC | 12,284 | 33.01 | 33.76 | 2.27% | 8.62% |
| 7 | Johnson & Johnson | JNJ | NYSE | 11,493 | 134.20 | 132.40 | -1.34% | 2.60% |
| 8 | Merck & Co. | MRK | NYSE | 11,323 | 76.45 | 77.52 | 1.40% | 1.45% |
| 9 | Volkswagen AG | VWAGY | OTC | 10,915 | 17.45 | 16.34 | -6.36% | 4.74% |
| 10 | Toyota | TM | NYSE | 10,848 | 122.00 | 117.31 | -3.84% | 1.06% |
| 11 | Novartis | NVS | NYSE | 8,934 | 87.66 | 88.85 | 1.36% | 3.54% |
| 12 | Honda | HMC | NYSE | 8,180 | 29.13 | 26.76 | -8.14% | 1.17% |
| 13 | Pfizer | PFE | NYSE | 7,942 | 42.88 | 42.23 | -1.52% | -3.25% |
| 14 | Daimler | DDAIY | OTC | 7,615 | 60.65 | 54.71 | -9.79% | 3.68% |
| 15 | General Motors | GM | NYSE | 7,278 | 38.78 | 38.70 | -0.21% | 15.70% |
| 16 | Oracle | ORCL | NYSE | 7,001 | 50.81 | 51.03 | 0.43% | 13.02% |
| 17 | Bristol-Myers Squibb | BMY | NYSE | 6,981 | 49.89 | 50.22 | 0.66% | -3.39% |
| 18 | Eli Lilly Co | LLY | NYSE | 6,769 | 120.89 | 119.60 | -1.07% | 3.35% |
| 19 | GlaxoSmithKline | GSK | NYSE | 6,394 | 39.20 | 41.09 | 4.82% | 7.54% |
| 20 | Cisco | CSCO | NASDAQ | 6,009 | 47.34 | 47.19 | -0.32% | 8.91% |
| 21 | IBM | IBM | NYSE | 5,842 | 134.10 | 133.71 | -0.29% | 17.63% |
| 22 | Bayer AG | BAYN | OTC | 5,743 | 19.24 | 18.86 | -1.98% | 7.34% |
| 23 | Astra Zeneca PLC | AZN | NYSE | 5,483 | 36.65 | 37.01 | 0.98% | -2.55% |
| 24 | Qualcomm | QCOM | NASDAQ | 5,183 | 49.61 | 50.29 | 1.37% | -11.62% |
| 25 | Sanofi SA | SNY | NYSE | 4,694 | 43.26 | 42.64 | -1.43% | -1.77% |
| Total | 243,754 | 4,296.08 | 4,235.74 | -1.40% | 5.17% | |||
| Biopharmaceutical | 683.33 | 684.18 | 0.12% | 1.98% | ||||
| Automotive | 268.01 | 253.82 | -5.29% | 3.88% | ||||
| ICT | 1,718.51 | 1,709.52 | -0.52% | 6.16% | ||||
About the R&D Index
R&D Magazine’s R&D Index is a weekly stock market summary of the top international companies involved in research and development. The top 25 industrial spenders of R&D in 2017 were selected based on the latest listings from Schonfeld & Associates’ June 2018 R&D Ratios & Budgets. These 25 companies include pharmaceutical (11 companies), automotive (5), ICT (8) and conglomerate (1) organizations who invested a cumulative total of more than $209 billion in R&D in 2017, or approximately 10% of all the R&D spent in the world by government, industries and academia combined, according to R&D Magazine’s 2019 Global R&D Funding Forecast. The stock prices used in the R&D Index are tabulated from NASDAQ, NYSE, XETRA and OTC common stock prices (in U.S. dollars) for the companies selected at the close of stock trading business on the Friday preceding the publication of the R&D Index in R&D Magazine’s R&D Daily eNewsletter.
