Summary: Pharmaceutical giant Pfizer has reported a narrower-than-expected adjusted loss for the third quarter. The loss was largely due to struggles with its Covid antiviral treatment Paxlovid and write-offs for its Covid vaccine. Pfizer recorded a $5.6 billion charge for inventory write-offs, with $4.7 billion attributed to Paxlovid and $900 million to the vaccine. The decline in demand for Covid products has led Pfizer to announce a $3.5 billion cost-cutting plan. Despite the losses, Pfizer reiterated its full-year adjusted earnings and revenue guidance.
Struggles with Paxlovid and Covid Vaccine
Pfizer reported a narrower-than-expected adjusted loss for Q3, largely due to struggles with its Covid antiviral treatment Paxlovid and write-offs for its Covid vaccine. The company recorded a $5.6 billion charge for inventory write-offs, with $4.7 billion attributed to Paxlovid and $900 million to the vaccine.
Decline in Demand for Covid Products
The decline in demand for Covid products has affected Pfizer's financial performance. The pharmaceutical giant's Q3 revenue dropped 42% to $13.23 billion compared to the same period last year. Sales of the Covid vaccine were down 70% to $1.31 billion, while Paxlovid revenue decreased by 97% to $202 million.
Cost-Cutting Plan and Guidance
To mitigate the impact of declining demand, Pfizer announced a $3.5 billion cost-cutting plan. The company aims to strengthen investor sentiment as it and other drugmakers like Moderna navigate the shift of their Covid businesses to the commercial market. Despite the losses, Pfizer reiterated its full-year adjusted earnings and revenue guidance.
Performance of Non-Covid Drugs
Excluding Covid products, Pfizer reported a 10% growth in revenue for the quarter. This was driven by the launch of new drugs and acquisitions. Revenue was fueled by the sales of the new vaccine against respiratory syncytial virus, Biohaven Pharmaceuticals' migraine drug Nurtec ODT, Global Blood Therapeutics' sickle cell disease treatment Oxbryta, and Vyndaqel drugs used to treat certain types of cardiomyopathy.
Focus on Growth Opportunities
Pfizer is shifting investor focus towards its growth opportunities, including mergers and acquisitions and its pipeline of new drugs. The company has recently launched several products and is awaiting updates on a mid-stage trial of its oral obesity pill danuglipron. Pfizer's acquisition of cancer therapy maker Seagen has also been approved by the European Commission and is expected to contribute to future sales.
Tags: Pfizer, quarterly loss, Paxlovid, Covid vaccine write-offs, decline in demand, cost-cutting plan, non-Covid drugs, growth opportunities
