We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Pfizer (PFE) Seems Well-Poised for Long-Term Growth: Here's How
Read MoreHide Full Article
Pfizer’s(PFE - Free Report) top line has been declining due to steep drops in revenues from its COVID-19 products, Comirnaty vaccine and Paxlovid oral pill, on lower demand due to the end of the pandemic. During the pandemic, Pfizer gave the world the first and most widely used vaccine, Comirnaty and the oral treatment for COVID-19, Paxlovid.
Pfizer records direct sales and alliance revenues from its partner, BioNTech (BNTX - Free Report) , for Comirnaty and product revenues from Paxlovid.
In the second quarter of 2023, though the decline in sales of COVID products was expected, sales of several other key medicines like Prevnar, alliance revenues from Bristol-Myers (BMY - Free Report) for Eliquis and Ibrance missed expectations. Pfizer said that some near-term individual product challenges hurt its sales performance in the quarter. The short-term headwinds included the tornado damage to Pfizer’s facility in Rocky Mount, the approval of Talzenna in the United States in a narrower patient population than expected and shared decision-making recommendation by ACIP for the RSV vaccine for older adults.
Pfizer also narrowed its 2023 revenue guidance as well as its non-COVID operational revenue growth expectations.
Concerns remain about its near-term growth drivers due to competitive pressure. Nonetheless, Pfizer looks well-positioned to deliver several breakthrough medicines in the next five years, which can drive long-term growth. In fact, Pfizer has the largest number of new product and indication launches planned for 2023, most of which are expected to occur in the second half of the year.
Pfizer is more than halfway of its goal of launching 19 new products or indications in 18 months' time (all non-COVID indications), which are expected to generate around $20 billion in sales by 2030. Two-thirds of these products have blockbuster potential, according to Pfizer.
The FDA approved Abrysvo, Pfizer’s RSV vaccine for older adults, in May. Zavzpret (zavegepant nasal spray), Pfizer’s CGRP receptor antagonist for the acute treatment of migraine was approved in March 2023.
In June, the FDA approved Litfulo (ritlecitinib), its JAK3 inhibitor for treating severe alopecia areata in adults and adolescents. The FDA also approved Ngenla, a long-acting once-weekly treatment for pediatric growth hormone deficiency in the same month.
Pfizer believes some of its new product launches like Abrysvo RSV vaccine, etrasimod for ulcerative colitis (under review in United States and EU) and its pentavalent meningococcal vaccine (under review in Europe and the United States), coupled with business development activities, including the proposed acquisition of Seagen position Pfizer strongly for operational growth in 2025 and beyond
Pfizer offered to buy cancer drugmaker Seagen for $229 per share in cash or a total enterprise value of approximately $43 billion in March.
Seagen’s acquisition is expected to strengthen Pfizer’s portfolio of cancer drugs by adding a class of antibody-drug conjugates. Seagen currently markets four cancer drugs — Adcetris, Padcev, Tukysa and Tivdak. The Pfizer/Seagen transaction is expected to be closed in late 2023 or early 2024. The shareholders of Seagen have already approved the deal.
The huge profits that Pfizer generated from its COVID products in 2021 and 2022 also strengthened its cash position, which is being used to make acquisitions, increase dividends, buy back shares and reduce debt. The cash enabled it to acquire Arena, ReViral, Biohaven and Global Blood Therapeutics in 2022. It also allowed Pfizer to increase investments in research and marketing investments to support its expected new product launches. Overall, the profits and cash from COVID products allowed Pfizer to support its growth plans for the second half of this decade.
Conclusion
Overall, after a weaker first half of 2023, Pfizer expects better non-COVID operational revenue growth in the second half of 2023, driven by its in-line products, new launches like Abrysvo vaccine for older adults and Zavzpret as well as newly acquired products like Nurtec and Oxbryta. Nurtec ODT/Vydura was added to Pfizer’s portfolio with the acquisition of most of Biohaven in 2022. Oxbryta was added with the October 2022 acquisition of Global Blood Therapeutics.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Pfizer (PFE) Seems Well-Poised for Long-Term Growth: Here's How
Pfizer’s (PFE - Free Report) top line has been declining due to steep drops in revenues from its COVID-19 products, Comirnaty vaccine and Paxlovid oral pill, on lower demand due to the end of the pandemic. During the pandemic, Pfizer gave the world the first and most widely used vaccine, Comirnaty and the oral treatment for COVID-19, Paxlovid.
Pfizer records direct sales and alliance revenues from its partner, BioNTech (BNTX - Free Report) , for Comirnaty and product revenues from Paxlovid.
In the second quarter of 2023, though the decline in sales of COVID products was expected, sales of several other key medicines like Prevnar, alliance revenues from Bristol-Myers (BMY - Free Report) for Eliquis and Ibrance missed expectations. Pfizer said that some near-term individual product challenges hurt its sales performance in the quarter. The short-term headwinds included the tornado damage to Pfizer’s facility in Rocky Mount, the approval of Talzenna in the United States in a narrower patient population than expected and shared decision-making recommendation by ACIP for the RSV vaccine for older adults.
Pfizer also narrowed its 2023 revenue guidance as well as its non-COVID operational revenue growth expectations.
Concerns remain about its near-term growth drivers due to competitive pressure. Nonetheless, Pfizer looks well-positioned to deliver several breakthrough medicines in the next five years, which can drive long-term growth. In fact, Pfizer has the largest number of new product and indication launches planned for 2023, most of which are expected to occur in the second half of the year.
Pfizer is more than halfway of its goal of launching 19 new products or indications in 18 months' time (all non-COVID indications), which are expected to generate around $20 billion in sales by 2030. Two-thirds of these products have blockbuster potential, according to Pfizer.
The FDA approved Abrysvo, Pfizer’s RSV vaccine for older adults, in May. Zavzpret (zavegepant nasal spray), Pfizer’s CGRP receptor antagonist for the acute treatment of migraine was approved in March 2023.
In June, the FDA approved Litfulo (ritlecitinib), its JAK3 inhibitor for treating severe alopecia areata in adults and adolescents. The FDA also approved Ngenla, a long-acting once-weekly treatment for pediatric growth hormone deficiency in the same month.
Pfizer believes some of its new product launches like Abrysvo RSV vaccine, etrasimod for ulcerative colitis (under review in United States and EU) and its pentavalent meningococcal vaccine (under review in Europe and the United States), coupled with business development activities, including the proposed acquisition of Seagen position Pfizer strongly for operational growth in 2025 and beyond
Pfizer offered to buy cancer drugmaker Seagen for $229 per share in cash or a total enterprise value of approximately $43 billion in March.
Seagen’s acquisition is expected to strengthen Pfizer’s portfolio of cancer drugs by adding a class of antibody-drug conjugates. Seagen currently markets four cancer drugs — Adcetris, Padcev, Tukysa and Tivdak. The Pfizer/Seagen transaction is expected to be closed in late 2023 or early 2024. The shareholders of Seagen have already approved the deal.
The huge profits that Pfizer generated from its COVID products in 2021 and 2022 also strengthened its cash position, which is being used to make acquisitions, increase dividends, buy back shares and reduce debt. The cash enabled it to acquire Arena, ReViral, Biohaven and Global Blood Therapeutics in 2022. It also allowed Pfizer to increase investments in research and marketing investments to support its expected new product launches. Overall, the profits and cash from COVID products allowed Pfizer to support its growth plans for the second half of this decade.
Conclusion
Overall, after a weaker first half of 2023, Pfizer expects better non-COVID operational revenue growth in the second half of 2023, driven by its in-line products, new launches like Abrysvo vaccine for older adults and Zavzpret as well as newly acquired products like Nurtec and Oxbryta. Nurtec ODT/Vydura was added to Pfizer’s portfolio with the acquisition of most of Biohaven in 2022. Oxbryta was added with the October 2022 acquisition of Global Blood Therapeutics.