Because of the anemic outlook for its hepatitis C franchise and recent clinical setbacks, Gilead Sciences (NASDAQ: GILD) may not be the outright bargain that its rock-bottom forward price-to-earnings ratio of about seven would seem to indicate. In fact, Pfizer (NYSE:PFE) and GlaxoSmithKline plc (NYSE:GSK) both appear to be far more attractive biopharma stocks to buy right now. Here's why.  

Image Source: Getty Images.

Image Source: Getty Images.

Pfizer has ample dry powder to go after a galaxy-sized acquisition in 2017

Trump's proposed corporate tax reforms, combined with his administration's stated desire to somehow lower the prices of specialty medicines, could dramatically reshape the pharmaceutical landscape. 

Pfizer, for example, would have a much easier time accessing its ginormous foreign cash reserves under a Trump-inspired corporate tax rate. And the drugmaker would also be clearly incentivized to move away from its controversial practice of hiking the prices of older medicines on a regular basis.

To do so, Pfizer would most likely tap its $80 billion worth of overseas cash to pursue several tuck-in acquisitions -- or perhaps one galaxy-sized deal -- as a way to ramp up its sales volumes.

Now, the really intriguing part is that if Pfizer does go big-game hunting with its newly unlocked overseas cash this year, there is at least one target that would make a lot of sense: Bristol-Myers Squibb (NYSE:BMY).

First off, Bristol's stock has gone into free-fall in the last couple of months because of Opdivo's stumble in the frontline lung cancer setting, giving it an incredibly attractive valuation for a potential buyer. This drugmaker, after all, sports a well-established franchise-level product in Opdivo, along with several other high-growth medicines.

Further, Bristol's immuno-oncology portfolio and pipeline would instantly make Pfizer the industry leader in this ultra-high-growth marketplace and give the drugmaker a rock star lineup of approved cancer products that would include the breast cancer drug Ibrance, the prostate cancer medicine Xtandi, and of course, Opdivo.

Simply put, this deal would go a long way toward achieving Pfizer's goal of significantly boosting its footprint in oncology, and it could possibly serve as the springboard for the long-awaited breakup of this pharma giant. 

Circling back to less speculative ground, the key point is that Pfizer is in a strong position to take advantage of any significant changes to the corporate tax code and to weather any legislation aimed at curbing prescription drug costs in the United States.

Matter of fact, these winds of change, so to speak, may turn out to be the catalysts that finally force the drugmaker's conservative management team into making the moves necessary to unlock the company's deeper layers of value. 

GlaxoSmithKline is now a bona fide comeback story

The British pharma giant GlaxoSmithKline is in many ways the perfect hedge against the possibility of sweeping changes to U.S. drug pricing schemes. Because of Glaxo's fierce battle with payers over the reimbursement status of its core respiratory medicines -- such as Anoro and Breo Ellipta -- that helped to tank its value over the past couple of years, this drugmaker smartly decided to start exploring alternative vehicles to drive top-line growth.

GSK Chart

GSK data by YCharts.

Glaxo's somewhat unusual answer to this pushback from payers was to double down on its less profitable businesses, like consumer health and vaccines, as a way to deliver more sustainable levels of growth. The net result is that the drugmaker's top line is finally set to rebound next year and actually grow by a healthy 8.6% in 2018.

While its pharmaceutical segment still makes up over half of the company's total revenue, this strategic shift has tamped down Glaxo's potential exposure to a full-blown political war over drug prices in the United States. The same simply can't be said for other drugmakers that, like Gilead, rely almost exclusively on super-expensive specialty medicines for revenue growth. 

As Glaxo's consumer health and vaccine units are set to produce mid- to high-single-digit sales growth this year, and the company offers an outstanding dividend yield of 4.77%, this pharma stock arguably stands apart from its peer group. At the very least, it comes with far less risk than Gilead right now. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.