Pfizer in-line forecasts provide investor relief, shares higher
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The news: Pfizer shares jumped over 4.5% after the drugmaker forecast 2025 revenue of USD61 billion ($96.23 billion) to USD64 billion, aligning with Wall Street estimates despite a USD1 billion hit from Medicare drug benefit changes.
The context: It comes as Pfizer faces mounting pressure from activist investor Starboard Value, which has criticised the company’s USD70 billion in acquisitions and declining post-pandemic performance. The drugmaker has also struggled to compete with rivals thriving on weight-loss drugs.
At an analyst briefing, CEO Albert Bourla defended the company's strategy, pointing to USD4 billion in net operating expenses cuts in 2024, and an additional USD500 million to come in 2025.
Bourla also played down concerns about vaccine policy shifts under Trump and Robert Kennedy Jr’s nomination for Department of Health and Human Services secretary, saying he expects no major changes.
Trump has pledged to reform pharmacy benefit managers to lower drug costs, while Kennedy has long voiced doubts about the safety and efficacy of vaccines.
On Tuesday US time, Pfizer said changes to Medicare Part D under the Inflation Reduction Act—aimed at capping out-of-pocket drug costs for patients—would reduce 2025 revenue by about USD1 billion.
It also said it expected sales of its COVID-19 products in 2025 to be consistent with current-year levels.
The numbers: The company said it expected adjusted earnings per share in 2025 to come between USD2.80 and USD3.00 per share. Analysts expect adjusted earnings of USD2.88 per share in 2025, according to LSEG data.
Shares in the pharmaceutical giant, whose value has dipped close to 12% this year, rose as much as 4.75% in morning trading before paring back some gains.
What they said: “As we look forward, we are confident in our future. With our clear strategic roadmap, a robust pipeline of potential innovative medicines and vaccines and a talented team laser-focused on execution, we believe we are on course to deliver significant shareholder value,” Bourla said in a statement.
The sources: Pfizer statement , The Wall Street Journal , Reuters
