Pfizer, a leading pharmaceutical giant, experienced a notable dip in its stock value in Wednesday’s trading session. The decline came in response to the company’s announcement of projected flat revenue for 2024, a forecast shadowed by diminishing vaccine sales.
The company anticipates 2024 revenues to hover between $58.5 billion and $61.5 billion, closely aligning with its reiterated sales prediction for this year, which spans from $58 billion to $61 billion. However, the outlook isn’t as bright on the profit front, with projections ranging from $2.05 to $2.25 per share, a noticeable drop from the previously anticipated $2.45 to $2.65 per share. This downward adjustment is partly attributed to the impact of Pfizer’s significant $43 billion acquisition of Seagen, a cancer drug specialist, which is nearing completion.
The slump in vaccine sales, a major revenue driver for Pfizer in 2022, pushing its overall revenue beyond the $100 billion mark, has necessitated a reevaluation of the company’s 2023 projections made back in October. At that time, Pfizer also announced its decision to write off approximately $4.6 billion in inventories of Paxlovid, its oral COVID-19 treatment, and recognized a substantial $5.5 billion non-cash charge against its third-quarter earnings.
Despite these challenges, Pfizer’s CEO Albert Bourla remains optimistic about the company’s product portfolio. “Comirnaty and Paxlovid are expected to generate combined revenues of approximately $8 billion in 2024, and our comprehensive portfolio of Pfizer and Seagen products is projected to see an operational revenue growth of 8% to 10%,” Bourla stated. Additionally, he highlighted the anticipated savings of at least $4 billion by the end of 2024 from the company’s cost-realignment program, aiming to restore Pfizer’s pre-pandemic operating margins.
The merger with Seagen is viewed as a strategic move to bolster Pfizer’s position in cancer treatment development. “Joining forces with Seagen will enhance our capabilities, bringing us closer to delivering on the long-promised cures for certain cancers,” Bourla added.
Pfizer’s shares experienced a 9% fall in early Wednesday trading, landing at $26.02 each. This downturn marks a continuation of a six-month decline, now tallying at approximately 35.4%.
In another development, Pfizer recently halted the advancement of its two-dose obesity treatment, danuglipron, due to significant side effects observed in Phase II trial participants. This decision marks a setback in Pfizer’s entry into the competitive weight-loss drug market, currently led by Novo Nordisk’s Wegovy and Eli Lilly’s newly FDA-approved Zepbound.
As Pfizer navigates these challenges and opportunities, investors and industry observers are keenly watching how the pharmaceutical titan adapts and evolves in the dynamic healthcare landscape.