Pfizer increased its profit forecast for the year on Wednesday following first-quarter results that surprisingly surpassed Wall Street predictions. This unexpected increase was due to cost reductions, a lesser slump in sales of its COVID antiviral drug than initially feared, and a robust performance from its pneumonia vaccine.
The sales of the cancer drug Padcev, which Pfizer acquired via its sizable £31.1 billion agreement with Seagen, also delighted analysts by surpassing their projections. The Seagen agreement, along with a £2.9 billion cost-saving plan, makes up a crucial component of Pfizer’s growth strategy post-COVID. Investors have also been keeping tabs on Pfizer’s new RSV vaccine, which has been lagging its competitor GSK’s alternative vaccine since they both hit the market.
Pfizer has increased both the lower and upper limits of its 2024 profit forecast by 10 cents and now predicts earnings per share of $2.15 to $2.35. Despite experiencing an 11% drop in value this year, the New York-based pharmaceutical giant’s stocks saw about a 1% jump to $25.89 during premarket trading.
Seagen’s precision oncology treatments Padcev and Adcetris accounted for combined sales of $598 million for Pfizer in the quarter. Nevertheless, Adcetris failed to meet analysts’ sales expectations. Chris Schott, an analyst at JP Morgan, expressed the belief that increased new launch outcomes and improvements in the development pipeline are needed to shift the present narrative on Pfizer’s stock.
Despite a drop in Paxlovid sales by 50% to $2.04 billion for this quarter, Pfizer still expects a total revenue of $8 billion from its COVID-19 products – the Comirnaty vaccine it co-develops with BioNTech and the oral antiviral drug Paxlovid. The sales decrease was more favourable than analysts’ $762.5 million projection.
Following a revision of a US deal last year, Pfizer made a favourable adjustment of $771 million in the quarter thanks to the US Government returning unused Paxlovid inventory.
However, Pfizer’s COVID vaccine sales saw a decrease of 88% to $354 million, underperforming the estimated $496.5 million. In contrast, the Prevnar pneumonia vaccines surpassed expectations, generating sales of $1.69 billion against the projected $1.66 billion.
The Abrysvo vaccine, carefully monitored by Pfizer, which defends against the respiratory syncytial virus (RSV), only managed to generate revenues of $145 million, quite lower compared to the analyst’s predicted $353.3 million. Pfizer, nevertheless, reported an adjusted profit of 82 cents per share, a figure that significantly superseded the average analyst expectations of 52 cents based on data from LSEG. – Reuters.