Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTAndy Gould, The Motley FoolSun, July 5, 2026 at 5:36 PM GMT+2 4 min readThe iShares U.S. Pharmaceuticals ETF (NYSEMKT:IHE) offers lower fees and a higher dividend yield, while the Invesco Pharmaceuticals ETF (NYSEMKT:PJP) spreads its holdings more evenly across the sector's biggest players.Investors seeking pharmaceutical exposure in an ETF often have to choose between broad industry coverage and a more concentrated strategy. This comparison examines how IHE and PJP navigate the regulatory and research-heavy world of American drugmakers -- weighing fees, portfolio concentration, and long-term performance in a sector that can swing hard on a single clinical trial or FDA decision.Snapshot (cost & size)MetricPJPIHEIssuerInvescoiSharesExpense ratio0.57%0.38%1-year return (as of July 3, 2026)50.12%54.34%Dividend yield0.96%1.62%Beta0.500.55AUM$341.3 million$912.9 millionBeta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.IHE is the less expensive option with a 0.38% expense ratio, compared to PJP's 0.57%. IHE also pays a 1.62% dividend, meaningfully higher than PJP's 0.96%.Performance & risk comparisonMetricPJPIHEMax drawdown (5 yr)(17.51%)(16.02%)Growth of $1,000 over 5 years (total return)$1,562$1,747What's insideLaunched in 2006, IHE holds 56 positions -- all in U.S.-based pharmaceutical companies. However, its top two holdings dominate its portfolio: Eli Lilly (NYSE:LLY) and Johnson & Johnson (NYSE:JNJ) alone make up roughly 44% of the fund, at 24.2% and 20.3%, respectively, with Merck (NYSE:MRK) a distant third at 5.2%.PJP has an even narrower portfolio of 29 companies, but spreads the risk more evenly among its top holdings. Its largest positions include Eli Lilly at 5.4%, Abbott Laboratories (NYSE:ABT) at 5.3%, and Liquidia (NASDAQ:LQDA) at 5.1%. The fund was launched in 2005.For more guidance on ETF investing, check out the full guide at this link.What this means for investorsThe choice between IHE and PJP really comes down to how much company-specific risk you're comfortable taking on within your pharma exposure. IHE's cap-weighted approach means its fortunes are closely tied to just two companies, Johnson & Johnson and Eli Lilly -- so if either stumbles on a drug trial, patent cliff, or regulatory setback, the whole fund will feel it. That's a normal trait of cap-weighted sector funds -- not necessarily a red flag -- but worth knowing going in.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info