Pharma Underperformed for Years. The Past 12 Months Tell a Different Story. Trade the Momentum With 3X Leverage.

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The pharmaceutical industry is undergoing one of the more significant transformations in its history. AI-driven drug discovery is compressing development timelines that once took years. A looming wave of patent expirations is driving major pharmaceutical companies to acquire aggressively, injecting capital and deal flow into the broader sector. 

According to data from PwC, healthcare costs in the United States now exceed $5 trillion and are growing 8% annually, creating structural pressure to develop more effective treatments and expanding the long-term addressable market for pharmaceutical innovation.

After years of underperforming the broader market despite genuine scientific progress, the sector showed clear signs of an inflection in Q4 2025, a shift PwC described as driven by renewed confidence in a new wave of science and new strategies for adapting to market realities.

The S&P Pharmaceuticals Select Industry Index returned approximately 45% over the last year and has gained more than 7% quarter-to-date, suggesting the recovery is gaining traction rather than losing momentum.

For active traders looking to capitalize on bullish daily moves in pharmaceutical stocks, the Direxion Daily Pharmaceutical & Medical Bull 3X ETF (PILL) offers 300% daily leveraged exposure to the sector in a single ticker.

What PILL Tracks

The Direxion Daily Pharmaceutical & Medical Bull 3X ETF (PILL) seeks 300%, before fees and expenses, of the daily performance of the S&P Pharmaceuticals Select Industry Index, a modified equal-weighted index comprising pharmaceutical and medical stocks classified within the GICS pharmaceuticals sub-industry. The index includes 59 constituents ranging from large established pharmaceutical companies to clinical-stage developers.

The equal-weighted structure means no single company dominates fund performance. A cross-section of the index's top holdings illustrates the breadth of the sector exposure:

• Enliven Therapeutics (ELVN): a clinical-stage biopharmaceutical company developing small molecule kinase inhibitors for cancer, with active Phase 1 programs in chronic myeloid leukemia and HER2-mutant non-small cell lung cancer
• Corcept Therapeutics (CORT): focused on cortisol modulation for serious endocrinologic, oncologic, metabolic, and neurologic disorders, with Korlym approved for Cushing's syndrome and a pipeline of selective cortisol modulators in development
• Pfizer (PFE): one of the world's leading pharmaceutical companies with a diversified portfolio spanning oncology, vaccines, rare disease, and anti-infectives, recently reporting a 5.4% year-over-year revenue increase, per Yahoo Finance.
• Axsome Therapeutics (AXSM): a commercial-stage CNS-focused company with approved treatments for major depressive disorder, narcolepsy, and migraine, and an active pipeline targeting Alzheimer's agitation and fibromyalgia

The index spans the full range of pharmaceutical activity, and PILL's performance reflects that breadth rather than concentration in any single therapeutic area or company.

Trading Pharma With 3X Daily Leverage

The Direxion Daily Pharmaceutical & Medical Bull 3X ETF (PILL) seeks 300% of the daily performance of the S&P Pharmaceuticals Select Industry Index, before fees and expenses.

• When the index rises 1%, PILL targets a 3% gain (before fees)
• When the index falls 1%, PILL targets a 3% decline (before fees)
• No need to maintain margin collateral

PILL resets its leverage exposure daily. The 3X target applies to single-day index movements, and holding the fund beyond a single day introduces compounding effects. It is designed for short-term tactical trading, not long-term holds. The 3X leverage amplifies both gains and losses, making active position management essential.

Trade Pharma's Next Chapter

The pharmaceutical sector has spent years proving that science is advancing faster than the stock prices reflect. That gap has been closing, and the conditions supporting continued momentum include a robust M&A environment, a pipeline of novel therapies entering late-stage development, and an accelerating role for AI in drug discovery that is beginning to show up in development timelines and deal structures.

The S&P Pharmaceuticals Select Industry Index is up significantly over the past year and gaining ground quarter-to-date. For active traders with a bullish view on the sector's continued recovery, the Direxion Daily Pharmaceutical & Medical Bull 3X ETF (PILL) offers 300% daily leveraged exposure to that thesis in a single trade.

Leveraged and inverse ETFs pursue daily leveraged investment objectives, which means they are riskier than alternatives that do not use leverage. They seek daily goals and should not be expected to track the underlying index over periods longer than one day. They are not suitable for all investors and should be utilized only by sophisticated investors who understand leverage risk and who actively manage their investments.

An investor should carefully consider a Fund’s investment objective, risks, charges, and expenses before investing. A Fund’s prospectus and summary prospectus contain this and other information about the Direxion Shares. To obtain a Fund’s prospectus and summary prospectus call 866-476-7523 or visit our website at direxion.com. A Fund’s prospectus and summary prospectus should be read carefully before investing.

The S&P Pharmaceuticals Select Industry Index (SPSIPHTR) is a modified equal-weighted index that is designed to measure performance of the stocks comprising the S&P Total Market Index that are classified in the Global Industry Classification Standard (GICS) pharmaceuticals sub-industry. One cannot invest directly in an index.

Direxion Shares Risks – An investment in the Fund involves risk, including the possible loss of principal. The Fund is non-diversified and includes risks associated with the Fund’s concentrating its investments in a particular industry, sector, or geography which can increase volatility. The use of derivatives such as futures contracts and swaps are subject to market risks that may cause prices to fluctuate over time.

Pharmaceutical Industry Risk – The profitability of pharmaceutical companies is highly dependent on the development, procurement and marketing of drugs and the development, protection and exploitation of intellectual property rights and other proprietary information. These companies may be significantly affected by the expiration of patents or the loss of, or the inability to enforce, intellectual property rights.

Healthcare Sector Risk — Companies in the healthcare sector may be affected by extensive, costly and uncertain government regulation, rising costs of medical products and services, changes in the demand for medical products and services, an increased emphasis on outpatient services, limited product lines, industry innovation and/or consolidation, changes in technologies and other market developments.

Distributor: ALPS Distributors, Inc.

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