Buffett's Berkshire bets on Big Pharma, invests in four drugmakers

Andrew Cummings
November 18, 2020

() - Warren Buffett's Berkshire Hathaway (NYSE:) Inc said on Monday it has begun in the stocks of four large drugmakers, betting on an industry that could benefit as the world tries to emerge from the coronavirus pandemic.

Berkshire Hathaway Inc. filed an update on its stock portfolio with the Securities and Exchange Commission Monday.

The billionaire investor's company bought about 21 million AbbVie shares, 30 million BMS shares, 22 million Merck shares, and 3.7 million Pfizer shares in the third quarter, it disclosed in a regulatory filing.

"The Warren Buffett Shareholder" author Lawrence Cunningham and Smead Capital Management CEO and CIO Bill Smead respond to Berkshire Hathaway's shareholder meeting this year that featured only Warren Buffett and his possible successor Greg Abel.

The AbbVie, BMS, and Merck positions were each worth between $1.8 billion and $1.9 billion at the end of last quarter, while the smaller Pfizer position was worth $136 million.

While Bank of America accounted for 10.6% of Berkshire's $228.9 billion 13-F portfolio at the end of September 2020, Apple (despite the sale of some 36 million share post the company's 4-for-1 split) remained its largest holding, accounting for 47.8% of the portfolio's holdings (up from 44.1% at the end of June 2020).

Berkshire officials don't typically comment on these quarterly stock filings.

Proceeds from these sales helped fund the new-money purchases of the aforementioned healthcare names, as well as a new-money purchase of T-Mobile US and participation in the Snowflake initial public offering.

Berkshire added to its holdings in Bank of America, Kroger and General Motors during the quarter. Berkshire also confirmed it trimmed its Apple (NASDAQ:) stake and bought more Bank of America (NYSE:) stock.

Berkshire also said it cut its stake in Barrick Gold Corp.by 42.6 per cent to 12 million shares. The conglomerate also owns furniture, shoe, jewelry, chocolate, manufacturing, brick and underwear companies.

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