Pfizer Raises Profit Outlook as Investors Anticipate Turnaround, According to Reuters

By Michael Erman and Bhanvi Satija

Pfizer has raised its annual profit forecast, driven by cancer treatments acquired through a significant $43 billion acquisition of Seagen and robust sales of its heart disease medication. This update comes as the company faces a substantial revenue decline from its COVID-related products.

The market for Pfizer’s COVID-19 vaccine and treatment has diminished by billions of dollars annually. In response to this downturn, CEO Albert Bourla has undertaken several acquisitions, including the Seagen purchase, alongside implementing cost-cutting measures. The company is placing a renewed emphasis on cancer treatments.

With concerns over COVID-19 easing, investors have withdrawn from Pfizer, leading to its shares trading at approximately half of their peak values during the pandemic. Bourla articulated the necessity for the company to demonstrate its execution capability in an interview. "We will continue executing this year on our cost containment, our pipeline, and all our new product launches," he remarked. He believes these efforts will help improve the company’s stock price.

J.P. Morgan analyst Chris Schott foresees that Pfizer’s stock will likely remain within its current range due to constrained revenue growth and increasing competition from its rivals. He noted that "stronger new launch performance or further progress on the pipeline will be necessary to significantly change the narrative."

Pfizer’s shares were mostly unchanged at $30.67. Additionally, sales of Eliquis, the blood thinner it shares with another pharmaceutical company, are anticipated to be limited starting in 2026, when the U.S. begins negotiating prices for certain medications covered by Medicare for individuals aged 65 and above.

Bourla mentioned that negotiations regarding Eliquis with U.S. regulators proved challenging, but he expressed confidence alongside other pharmaceutical executives that the company would manage the effects of the new pricing on Eliquis, which remains a vital product for Pfizer.

Overall, Chief Financial Officer David Denton indicated that the law allowing U.S. price negotiations would have a "somewhat muted" impact on Pfizer, as many products likely to be selected for negotiation will be nearing the end of their patent protections.

In its latest quarterly report, Pfizer announced a 3% operational growth in sales, reaching $13.3 billion, marking the first growth in sales since COVID revenue peaked in late 2022. This quarter’s results were bolstered by sales of its heart disease drug and cancer therapy.

Pfizer now anticipates its annual profit to fall in the range of $2.45 to $2.65 per share, an increase from its previous forecast of $2.15 to $2.35. Analyst Evan Seigerman noted that, given Pfizer’s previously cautious outlook, this upward revision is somewhat expected, while expressing encouragement about the company’s operational execution.

The company also raised its annual sales forecast for its antiviral treatment for high-risk COVID cases by $500 million, elevating it to $3.5 billion. Sales for the heart drug exceeded analyst expectations, reaching $1.32 billion for the quarter. Sales for Padcev, a medication for bladder and urinary tract cancers, also surpassed estimates, totaling $394 million.

Quarterly sales of Pfizer’s COVID vaccine amounted to $195 million, while sales for its antiviral medication were $251 million. Analysts had projected $176 million for the vaccine and $247.7 million for the antiviral treatment.

Despite facing disappointment from its 2023 launch of the RSV vaccine Abrysvo, Pfizer remains hopeful about its prospects in the U.S. this year. Chief U.S. Commercial Officer Aamir Malik highlighted that the company has significantly improved its contracting position, with changes set to take effect in August. Last year, a competitor captured the majority of the RSV vaccine market due to its contracts with retail pharmacies.