It's important to determine the true valuation of a pharmaceutical company, according Brand Finance's "25 2020: The annual report on the most valuable and strongest pharma brands." "By valuing brands, we provide a mutually intelligible language for marketing and finance teams," writes Brand Finance's CEO David Haigh. "Marketers then have the ability to communicate the significance of what they do, and boards can use the information to chart a course that maximizes profits. Without knowing the precise, financial value of an asset, how can you know if you are maximizing your returns?" Related: 10 most profitable companies in the health care sector This year, Johnson & Johnson again tops the list, with a brand value of $10.9 billion. Despite suffering an 11 percent drop in brand value from last year because the New Brunswick, N.J.-based company failed to meet its financial targets in the final quarter of 2019, Johnson & Johnson retains a healthy lead over competitors, according to the report. "Johnson & Johnson is the most valuable pharma brand thanks to its continued investment in research and development, most recently in a vaccine designed to battle the deadly coronavirus, says Brand Finance managing director Richard Haigh. "With a timely and relevant R&D program, Johnson & Johnson can hope to maintain its prime position in the industry for years to come." Brand Finance calculates the values of the brands in its league tables using the "Royalty Relief approach"–a brand valuation method compliant with the industry standards set in ISO 10668. This involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a 'brand value' understood as a net economic benefit that a licensor would achieve by licensing the brand in the open market. Check out this year's top 10 most valuable brands in the slideshow above. Read more: |

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