- Solid First-Quarter Results Reflect Continued Growth of Key
Products and Progress in Executing 2024 Priorities
- First-Quarter 2024 Revenues of $14.9 Billion
- Expected Decline in Comirnaty(1) and Paxlovid Revenues Drove a
Year-Over-Year Operational Decrease in Revenues of 19%
- Excluding Contributions from Comirnaty(1) and Paxlovid,
Revenues Grew 11% Operationally
- First-Quarter 2024 Reported(2) Diluted EPS of $0.55 and
Adjusted(3) Diluted EPS of $0.82
- Both Include an $0.11 Favorable Impact from Final Revenue
Adjustment Reflecting Actual EUA-labeled Treatment Courses of
Paxlovid Returned by U.S. Government(4)
- On Track to Deliver at Least $4 Billion in Net Cost Savings by
End of 2024 from Previously Announced Cost Realignment
Program(5)
- Reaffirms Full-Year 2024 Revenue Guidance(6) of $58.5 to $61.5
Billion and Raises Adjusted(3) Diluted EPS Guidance to $2.15 to
$2.35
Pfizer Inc. (NYSE: PFE) reported financial results for the first
quarter of 2024 and raised its Adjusted(3) diluted EPS guidance
while maintaining all other components of its 2024 financial
guidance(6).
The first-quarter 2024 earnings presentation and accompanying
prepared remarks from management as well as the quarterly update to
Pfizer’s R&D pipeline can be found at www.pfizer.com.
EXECUTIVE COMMENTARY
Dr. Albert Bourla, Chairman and Chief Executive Officer, stated:
“We delivered strong performance in our non-COVID product portfolio
in the first quarter of 2024, including increased revenue from
several of our recent commercial launches and acquired products, as
well as robust year-over-year growth for several key in-line
brands, namely the Vyndaqel family, Eliquis, and the Prevnar
family. In addition, we had strong oncology revenue contributions
from Ibrance, Xtandi, Padcev and Adcetris. Our Paxlovid revenues in
the quarter indicate a successful transition into the commercial
marketplace in the U.S. and a demonstrated trust in the brand.
“Overall, I am encouraged by a well-executed quarter, setting
the tone for the year. Pfizer’s commercial leadership is focused on
data-driven opportunities across several key growth brands, both in
the U.S. and internationally, and we intend to build on this
positive momentum in the quarters ahead.”
David Denton, Chief Financial Officer and Executive Vice
President, stated: “I am very pleased by the strong 11% operational
revenue growth of our non-COVID products in the first quarter,
demonstrating our focus on commercial execution. In addition, we
continue to progress our cost realignment program and remain on
track to deliver on our targeted cost savings goal by the end of
the year.”
OVERALL RESULTS
In the first quarter of 2024, we reclassified royalty income
(substantially all of which is related to Biopharma) from Other
(income)/deductions––net to revenues and began presenting Royalty
revenues as a separate line item within Total revenues in our
consolidated statements of income. Prior-period amounts have been
recast to conform to the current presentation.
At the beginning of 2024, we made changes in our commercial
organization that went into effect on January 1, 2024 to
incorporate Seagen Inc. (Seagen) and improve focus, speed and
execution. Specifically, within our Biopharma reportable segment we
created the Pfizer Oncology Division, the Pfizer U.S. Commercial
Division, and the Pfizer International Commercial Division. See the
Item 1. Business––Commercial Operations section of Pfizer's 2023
Annual Report on Form 10-K (available at www.pfizer.com).
Some amounts in this press release may not add due to rounding.
All percentages have been calculated using unrounded amounts.
References to operational variances pertain to period-over-period
changes that exclude the impact of foreign exchange rates(7).
Results for the first quarter of 2024 and 2023(8) are summarized
below.
($ in millions, except
per share amounts)
First-Quarter
2024
2023
Change
Revenues
$
14,879
$
18,486
(20
%)
Reported(2) Net Income
3,115
5,543
(44
%)
Reported(2) Diluted EPS
0.55
0.97
(44
%)
Adjusted(3) Income
4,674
7,036
(34
%)
Adjusted(3) Diluted EPS
0.82
1.23
(33
%)
REVENUES
($ in millions)
First-Quarter
2024
2023
% Change
Total
Oper.
Global Biopharmaceuticals Business
(Biopharma)
$
14,604
$
18,173
(20
%)
(19
%)
Business Innovation
275
313
(12
%)
(12
%)
TOTAL REVENUES
$
14,879
$
18,486
(20
%)
(19
%)
2024 FINANCIAL GUIDANCE(6)
Pfizer raises Adjusted(3) diluted EPS Guidance to $2.15 to $2.35
while maintaining all other components of its 2024 Financial
Guidance(6). The company still expects full-year 2024 revenues to
be in the range of $58.5 to $61.5 billion, which includes
approximately $8 billion in anticipated revenues for Comirnaty(1)
and Paxlovid (approximately $5 billion and $3 billion,
respectively), and approximately $3.1 billion in anticipated
revenues from legacy Seagen. Comirnaty(1) revenues continue to
perform consistently with our expectations and we anticipate
approximately 90% of sales to occur in the second half of the year,
mostly in the fourth quarter given the anticipated seasonality of
demand for COVID vaccinations.
The updated 2024 Adjusted(3) diluted EPS guidance takes into
consideration our confidence in delivering on our cost realignment
program target as well as our confidence in the underlying strength
in our business.
Pfizer’s 2024 financial guidance(6) is presented below.
Revenues
$58.5 to $61.5 billion
Adjusted(3) SI&A Expenses
$13.8 to $14.8 billion
Adjusted(3) R&D Expenses
$11.0 to $12.0 billion
Effective Tax Rate on Adjusted(3)
Income
Approximately 15.0%
Adjusted(3) Diluted EPS
$2.15 to $2.35
(previously $2.05 to $2.25)
Changes in foreign exchange rates have had a minimal incremental
impact since full-year 2024 guidance was reaffirmed on January 30,
2024. Please refer to Press Release Footnote (6) for additional
information.
CAPITAL ALLOCATION
During the first three months of 2024, Pfizer deployed its
capital in a variety of ways, which primarily include the following
two categories:
- Reinvesting capital into initiatives intended to enhance the
future growth prospects of the company, including:
- $2.5 billion invested in internal research and development
projects, and
- Approximately $100 million invested in business development
transactions.
- Returning capital directly to shareholders through $2.4 billion
of cash dividends, or $0.42 per share of common stock.
No share repurchases were completed to date in 2024. As of May
1, 2024, Pfizer’s remaining share repurchase authorization is $3.3
billion. Current financial guidance does not anticipate any share
repurchases in 2024.
First-quarter 2024 diluted weighted-average shares outstanding
used to calculate Reported(2) and Adjusted(3) diluted EPS were
5,697 million shares.
QUARTERLY FINANCIAL HIGHLIGHTS (First-Quarter 2024 vs.
First-Quarter 2023)
First-quarter 2024 revenues totaled $14.9 billion, a decrease of
$3.6 billion, or 20%, compared to the prior-year quarter,
reflecting an operational decline of $3.5 billion, or 19%,
primarily due to a significant decrease in Comirnaty(1) and
Paxlovid revenues globally, as well as an unfavorable impact of
foreign exchange of $107 million, or 1%. Excluding contributions
from Comirnaty(1) and Paxlovid, revenues totaled $12.5 billion, an
increase of $1.2 billion, or 11%, operationally compared with the
prior-year quarter.
First-quarter 2024 Comirnaty(1) revenues of $354 million
declined $2.7 billion, or 88%, operationally compared with the
prior-year quarter, driven largely by lower contractual deliveries
and demand in international markets as well as lower U.S. volumes,
reflecting the anticipated seasonality of demand for vaccinations
and as certain markets, including the U.S., transition to
traditional commercial market sales.
First-quarter 2024 Paxlovid revenues of $2.0 billion declined
$2.0 billion, or 50%, operationally compared with the prior-year
quarter, driven primarily by lower contractual deliveries in most
international markets and in the U.S. as a result of the transition
to traditional commercial market sales, as well as lower demand in
China due to the non-recurrent surge in COVID-19 infection during
the first quarter of 2023, partially offset by a $771 million
favorable final adjustment to the estimated non-cash revenue
reversal of $3.5 billion recorded in the fourth quarter of
2023.
Excluding contributions from Comirnaty(1) and Paxlovid,
first-quarter 2024 operational revenue growth was driven primarily
by:
- Global revenues of $742 million from legacy Seagen, which was
acquired in December of 2023;
- Vyndaqel family (Vyndaqel, Vyndamax, Vynmac) globally, up 66%
operationally, driven largely by continued strong uptake of the
transthyretin amyloid cardiomyopathy (ATTR-CM) indication,
primarily in the U.S. and developed markets in Europe;
- Eliquis globally, up 10% operationally, driven primarily by
continued oral anti-coagulant adoption and market share gains in
the non-valvular atrial fibrillation indication in the U.S. and
certain markets in Europe, partially offset by declines due to loss
of exclusivity and generic competition in certain international
markets;
- Abrysvo, which contributed $145 million in global revenues,
driven primarily by the launch of the older adult indication in the
U.S. in July 2023; and
- Prevnar family (Prevnar 20 & 13) globally, up 7%
operationally, driven primarily by the pediatric indication in the
U.S. due to favorable timing of government purchases and higher
patient demand in the private market, as well as strong uptake of
the adult indication in certain international markets, partially
offset by fewer adult vaccinations in the U.S.;
partially offset primarily by lower revenues for:
- Oncology biosimilars in the U.S., down 47% operationally,
largely due to lower net price;
- Sulperazon internationally, down 45% operationally, driven
largely by lower demand in China in the first quarter of 2024 as
compared to the first quarter of 2023; and
- Ibrance globally, down 7% operationally, driven primarily by
lower demand globally due to competitive pressure and price
decreases in certain international developed markets.
GAAP Reported(2) Income Statement Highlights
SELECTED REPORTED(2) COSTS AND EXPENSES
($ in millions)
First-Quarter
2024
2023
% Change
Total
Oper.
Cost of Sales(2)
$
3,379
$
4,886
(31
%)
(29
%)
Percent of Revenues
22.7
%
26.4
%
N/A
N/A
SI&A Expenses(2)
3,495
3,418
2
%
3
%
R&D Expenses(2)
2,493
2,505
—
—
Acquired IPR&D Expenses(2)
—
21
(100
%)
(100
%)
Other (Income)/Deductions—net(2)
680
275
*
*
Effective Tax Rate on Reported(2)
Income
8.6
%
11.4
%
* Indicates calculation not
meaningful.
First-quarter 2024 Cost of Sales(2) as a percentage of revenues
decreased by 3.7 percentage points compared with the prior-year
quarter, driven primarily by favorable changes in sales mix,
including lower sales of Comirnaty(1), which resulted in a lower
related charge for the 50% gross profit split with BioNTech and
applicable royalty expenses; and, to a much lesser extent, the
impact of a $771 million favorable final adjustment to the non-cash
Paxlovid revenue reversal, partially offset by the amortization of
the fair value step-up of inventory related to the Seagen
acquisition, as well as lower sales of Paxlovid.
First-quarter 2024 SI&A Expenses(2) increased 3%
operationally compared with the prior-year quarter, driven
primarily by an increase in marketing and promotional expenses for
recently acquired and launched products, partially offset by a
decrease in marketing and promotional expenses for Paxlovid and
Comirnaty(1).
First-quarter 2024 R&D Expenses(2) were relatively flat
operationally compared with the prior-year quarter, primarily due
to lower spending as a result of our cost realignment program as
well as lower spending on certain ongoing vaccine programs, largely
offset by increased investments mainly to develop certain medicines
acquired from Seagen.
The unfavorable period-over-period change in Other
deductions—net(2) of $406 million for the first quarter of 2024,
compared with the prior-year quarter, was driven primarily by
higher net interest expense and lower dividend income, partially
offset by net gains on equity securities in the first quarter of
2024 versus net losses on equity securities in the first quarter of
2023.
Pfizer’s effective tax rate on Reported(2) income for the first
quarter of 2024 decreased compared to the prior-year quarter
primarily due to a favorable change in the jurisdictional mix of
earnings.
Adjusted(3) Income Statement Highlights
SELECTED ADJUSTED(3) COSTS AND EXPENSES
($ in millions)
First-Quarter
2024
2023
% Change
Total
Oper.
Adjusted(3) Cost of Sales
$
3,036
$
4,746
(36
%)
(34
%)
Percent of Revenues
20.4
%
25.7
%
N/A
N/A
Adjusted(3) SI&A Expenses
3,454
3,350
3
%
3
%
Adjusted(3) R&D Expenses
2,477
2,491
(1
%)
(1
%)
Adjusted(3) Other
(Income)/Deductions—net
296
(324
)
*
*
Effective Tax Rate on Adjusted(3)
Income
16.6
%
14.0
%
* Indicates calculation not
meaningful.
See the reconciliations of certain Reported(2) to non-GAAP
Adjusted(3) financial measures and associated footnotes in the
financial tables section of the press release located at the
hyperlink below.
RECENT NOTABLE DEVELOPMENTS (Since January 30, 2024)
Product Developments
Product/Project
Recent Development
Link
Abrysvo
(respiratory syncytial virus
vaccine)
April 2024. Reported positive
top-line immunogenicity and safety data from the ongoing pivotal
Phase 3 clinical trial, MONeT (RSV IMmunizatiON Study for AdulTs at
Higher Risk of Severe Illness), evaluating a single dose of Abrysvo
versus placebo in adults 18 to 59 years of age at risk of
developing severe RSV-associated lower respiratory tract disease
(LRTD). Participants demonstrated RSV-A and RSV-B subgroup
neutralizing responses non-inferior to the response seen in the
Phase 3 RENOIR study of Abrysvo in adults aged 60 or older where
vaccine efficacy was previously demonstrated. The vaccine was
well-tolerated during the trial, and safety findings were
consistent with those from previous investigations of Abrysvo in
other populations.
The company intends to submit these data
to regulatory agencies and request expansion of the age group from
the current indication to 18 years of age and older.
Full Release
February 2024. Reported positive
top-line efficacy and safety data for Abrysvo in adults 60 years of
age and older following a second season in the Northern and
Southern Hemispheres from the ongoing pivotal Phase 3 clinical
trial RENOIR. The vaccine demonstrated durable efficacy after two
seasons against RSV-associated LRTD. Consistent vaccine efficacy
was demonstrated for both RSV-A and RSV-B after season two with
vaccine efficacy against each subtype of ≥80% for LRTD with three
or more symptoms. Vaccine efficacy was also sustained against less
severe LRTD, defined by two or more symptoms after the end of
season two. No new adverse events were reported through the second
RSV season beyond what was reported in the clinical trial during
the first season.
Pfizer intends to submit the data to
regulatory authorities and vaccine technical committees as well as
publish the findings in a peer-reviewed scientific journal and
share them at an upcoming scientific congress.
Full Release
Adcetris
(brentuximab vedotin)
March 2024. The Phase 3 study,
ECHELON-3, of Adcetris in combination with lenalidomide and
rituximab for the treatment of patients with relapsed/refractory
diffuse large B-cell lymphoma (DLBCL) showed a statistically
significant and clinically meaningful improvement in overall
survival (OS) compared to lenalidomide and rituximab plus placebo.
Positive outcomes were also observed in key secondary endpoints.
The safety and tolerability of Adcetris in the ECHELON-3 trial were
consistent with what has been previously presented for patients
with relapsed/refractory DLBCL treated with Adcetris in clinical
trials.
Pfizer plans to share the ECHELON-3 data
with the U.S. Food and Drug Administration (FDA) to potentially
support regulatory filing in the U.S.
Full Release
Beqvez (fidanacogene
elaparvovec-dzkt)
April 2024. The FDA approved
Beqvez, a one-time gene therapy for adults with moderate to severe
hemophilia B who currently use factor IX prophylaxis therapy, or
have current or historical life-threatening hemorrhage, or have
repeated, serious spontaneous bleeding episodes, and do not have
neutralizing antibodies to adeno-associated virus serotype Rh74var
(AAVRh74var) capsid as detected by an FDA-approved test. Beqvez has
provided sustained bleed protection relative to standard of care.
In the Phase 3 study, BENEGENE-2, bleeds were eliminated in 60% of
patients compared to 29% in the prophylaxis arm, and a median
annualized bleeding rate (ABR) of zero was observed after up to
three years of follow up (range of 0 to 19) compared to the lead-in
pre-treatment period in which a median ABR of 1.3 was observed
(range of 0 to 53.9).
Full Release
Emblaveo
(aztreonam-avibactam)
April 2024. The European Commission
(EC) granted marketing authorization for Emblaveo for the treatment
of adult patients with complicated intra-abdominal infections
(cIAI), hospital-acquired pneumonia (HAP), including
ventilator-associated pneumonia (VAP), and complicated urinary
tract infections (cUTI), including pyelonephritis. It is also
indicated for the treatment of infections due to aerobic
Gram-negative organisms in adult patients with limited treatment
options. It combines aztreonam, a monobactam β-lactam, with
avibactam, a recent broad-spectrum β-lactamase inhibitor. Pfizer
holds the global rights to commercialize this therapy outside of
the U.S. and Canada, where the rights are held by AbbVie Inc.
Full Release
Prevnar 20
(20-valent pneumococcal
conjugate vaccine)
March 2024. The EC granted
marketing authorization for the company’s 20-valent pneumococcal
conjugate vaccine, marketed in the European Union (EU) under the
brand name Prevenar 20, for active immunization for the prevention
of invasive disease, pneumonia and acute otitis media caused by
Streptococcus pneumoniae in infants, children and adolescents from
6 weeks to less than 18 years of age. The authorization is valid in
all 27 EU member states plus Iceland, Liechtenstein and Norway.
Full Release
Tivdak
(tisotumab
vedotin-tftv)
April 2024. The FDA granted Pfizer
and Genmab A/S full approval for Tidvak for the treatment of
patients with recurrent or metastatic cervical cancer with disease
progression on or after chemotherapy. Conversion to full approval
from accelerated approval was based on positive results from the
global Phase 3 innovaTV 301 study which demonstrated an overall
survival (OS) benefit of Tidvak compared to chemotherapy.
Full Release
February 2024. The European
Medicines Agency (EMA) validated for review the marketing
authorization application (MAA) of tisotumab vedotin, an
antibody-drug conjugate (ADC) developed for the treatment of adult
patients with recurrent or metastatic cervical cancer with disease
progression on or after first-line therapy.
If approved, tisotumab vedotin would be
the first ADC granted EU marketing authorization for people living
with cervical cancer.
Full Release
Velsipity
(etrasimod)
February 2024. The EC granted
marketing authorization for Velsipity in the EU to treat patients
16 years of age and older with moderately to severely active
ulcerative colitis (UC) who have had an inadequate response, lost
response, or were intolerant to either conventional therapy, or a
biological agent.
The marketing authorization for Velsipity
is valid in all 27 EU member states as well as Iceland,
Liechtenstein, and Norway.
Full Release
Pipeline Developments
A comprehensive update of Pfizer’s development pipeline was
published today and is now available at
www.pfizer.com/science/drug-product-pipeline. It includes an
overview of Pfizer’s research and a list of compounds in
development with targeted indication and phase of development, as
well as mechanism of action for some candidates in Phase 1 and all
candidates from Phase 2 through registration.
Product/Project
Recent Development
Link
Vepdegestrant
(ARV-471)
February 2024. The FDA granted Fast
Track designation for the investigation of vepdegestrant for
monotherapy in the treatment of adults with estrogen receptor (ER)
positive/human growth epidermal growth factor 2 (HER2) negative
(ER+/HER2-) locally advanced or metastatic breast cancer previously
treated with endocrine-based therapy.
Full Release
Corporate Developments
Topic
Recent Development
Link
“Oncology Innovation
Day”
February 2024. Pfizer hosted a
meeting with the investment community where it outlined its
strategic priorities for its Oncology organization. Pfizer’s
Oncology portfolio is focused on three core scientific modalities:
small molecules, ADCs, and bispecific antibodies, including other
immuno-oncology biologics; and is focused on expanding its
leadership in four main cancer types: breast cancer, genitourinary
cancer, hematology-oncology, and thoracic cancers. By 2030, the
company anticipates eight or more potential blockbusters in
Oncology alone.
Full Release
“Change the Odds: Uniting to
Improve Cancer Outcomes™”
February 2024. Pfizer and the
American Cancer Society announced the launch of a three-year
initiative to bridge the gap in cancer care disparities. Through
$15 million in funding from Pfizer, the initiative aims to improve
health outcomes in medically underrepresented communities across
the U.S. by enhancing awareness of and access to cancer screenings,
clinical trial opportunities, and patient support and comprehensive
navigation.
Full Release
Please find Pfizer’s press release and associated financial
tables, including reconciliations of certain GAAP reported to
non-GAAP adjusted information, at the following hyperlink:
https://investors.pfizer.com/Q1-2024-PFE-Earnings-Release
(Note: If clicking on the above link does not open a new
webpage, you may need to cut and paste the above URL into your
browser's address bar.)
For additional details, see the financial schedules and
product revenue tables attached to the press release located at the
hyperlink above, and the attached disclosure notice.
(1)
As used in this document,
“Comirnaty” refers to, as applicable, and as authorized or
approved, the Pfizer-BioNTech COVID-19 Vaccine; Comirnaty (COVID-19
Vaccine, mRNA) original monovalent formula; the Pfizer-BioNTech
COVID-19 Vaccine, Bivalent (Original and Omicron BA.4/BA.5); the
Pfizer-BioNTech COVID-19 Vaccine (2023-2024 Formula); Comirnaty
(COVID-19 Vaccine, mRNA) 2023-2024 Formula; Comirnaty
Original/Omicron BA.1; Comirnaty Original/Omicron BA.4/BA.5; and
Comirnaty Omicron XBB.1.5. “Comirnaty” includes product revenues
and alliance revenues related to sales of the above-mentioned
vaccines.
(2)
Revenues is defined as revenues
in accordance with U.S. generally accepted accounting principles
(GAAP). Reported net income and its components are defined as net
income attributable to Pfizer Inc. common shareholders and its
components in accordance with U.S. GAAP. Reported diluted earnings
per share (EPS) is defined as diluted EPS attributable to Pfizer
Inc. common shareholders in accordance with U.S. GAAP.
(3)
Adjusted income and Adjusted
diluted EPS are defined as U.S. GAAP net income attributable to
Pfizer Inc. common shareholders and U.S. GAAP diluted EPS
attributable to Pfizer Inc. common shareholders before the impact
of amortization of intangible assets, certain acquisition-related
items, discontinued operations and certain significant items. See
the reconciliations of certain GAAP Reported to Non-GAAP Adjusted
information for the first quarter of 2024 and 2023 in the press
release located at the hyperlink above. Adjusted income and its
components and Adjusted diluted EPS measures are not, and should
not be viewed as, substitutes for U.S. GAAP net income and its
components and diluted EPS(2). See the Non-GAAP Financial Measure:
Adjusted Income section of Management’s Discussion and Analysis of
Financial Condition and Results of Operations in Pfizer’s 2023
Annual Report on Form 10-K and the Non-GAAP Financial Measure:
Adjusted Income section of the press release located at the
hyperlink above for a definition of each component of Adjusted
income as well as other relevant information.
(4)
First-quarter 2024 Reported(2)
and Adjusted(3) diluted EPS were favorably impacted by $0.11
resulting from a $771 million final adjustment to the estimated
non-cash Paxlovid revenue reversal of $3.5 billion recorded in the
fourth quarter of 2023, reflecting 5.1 million EUA-labeled
treatment courses returned by the U.S. government through February
29, 2024 versus the estimated 6.5 million treatment courses that
were expected to be returned as of December 31, 2023.
(5)
The targeted $4 billion in net
cost savings is calculated versus the midpoint of Pfizer’s SI&A
and R&D expense guidance provided on August 1, 2023. As an
additional reference, see the ‘2024 Financial Guidance’ section of
Pfizer’s fourth-quarter 2023 earnings release.
(6)
Pfizer does not provide guidance
for GAAP Reported financial measures (other than revenues) or a
reconciliation of forward-looking non-GAAP financial measures to
the most directly comparable GAAP Reported financial measures on a
forward-looking basis because it is unable to predict with
reasonable certainty the ultimate outcome of unusual gains and
losses, certain acquisition-related expenses, gains and losses from
equity securities, actuarial gains and losses from pension and
postretirement plan remeasurements, potential future asset
impairments and pending litigation without unreasonable effort.
These items are uncertain, depend on various factors, and could
have a material impact on GAAP Reported results for the guidance
period.
Financial guidance for full-year
2024 reflects the following:
- Does not assume the completion of any business development
transactions not completed as of March 31, 2024.
- An anticipated immaterial impact in fiscal-year 2024 of recent
and expected generic and biosimilar competition for certain
products that have recently lost patent protection or that are
anticipated to lose patent protection.
- Exchange rates assumed are a blend of actual rates in effect
through first-quarter 2024 and mid-April 2024 rates for the
remainder of the year. Financial guidance reflects the anticipated
unfavorable impact of approximately $0.4 billion on revenues and
the anticipated favorable impact of approximately $0.02 on
Adjusted(3) diluted EPS as a result of changes in foreign exchange
rates relative to the U.S. dollar compared to foreign exchange
rates from 2023.
- Guidance for Adjusted(3) diluted EPS assumes diluted
weighted-average shares outstanding of approximately 5.75 billion
shares, and assumes no share repurchases in 2024.
(7)
References to operational
variances in this press release pertain to period-over-period
changes that exclude the impact of foreign exchange rates. Although
foreign exchange rate changes are part of Pfizer’s business, they
are not within Pfizer’s control and because they can mask positive
or negative trends in the business, Pfizer believes presenting
operational variances excluding these foreign exchange changes
provides useful information to evaluate Pfizer’s results.
(8)
Pfizer’s fiscal year-end for
international subsidiaries is November 30 while Pfizer’s fiscal
year-end for U.S. subsidiaries is December 31. Therefore, Pfizer’s
first quarter for U.S. subsidiaries reflects the three months ended
on March 31, 2024 and April 2, 2023, while Pfizer’s first quarter
for subsidiaries operating outside the U.S. reflects the three
months ended on February 25, 2024 and February 26, 2023.
DISCLOSURE NOTICE: Except where otherwise noted, the information
contained in this earnings release and the related attachments is
as of May 1, 2024. We assume no obligation to update any
forward-looking statements contained in this earnings release and
the related attachments as a result of new information or future
events or developments.
This earnings release and the related attachments contain
forward-looking statements about, among other topics, our
anticipated operating and financial performance, including
financial guidance and projections; reorganizations; business
plans, strategy, goals and prospects; expectations for our product
pipeline, in-line products and product candidates, including
anticipated regulatory submissions, data read-outs, study starts,
approvals, launches, clinical trial results and other developing
data, revenue contribution and projections, potential pricing and
reimbursement, potential market dynamics, including patient demand,
market size and utilization rates and growth, performance, timing
of exclusivity and potential benefits; strategic reviews; capital
allocation objectives; an enterprise-wide cost realignment program,
which we launched in October 2023 (including anticipated costs,
savings and potential benefits); dividends and share repurchases;
plans for and prospects of our acquisitions, dispositions and other
business development activities, including our December 2023
acquisition of Seagen, and our ability to successfully capitalize
on growth opportunities and prospects; manufacturing and product
supply; our ongoing efforts to respond to COVID-19, including our
plans and expectations regarding Comirnaty (as defined in this
earnings release) and our oral COVID-19 treatment (Paxlovid); our
expectations regarding the impact of COVID-19 on our business,
operations and financial results; and our Environmental, Social and
Governance (ESG) priorities, strategies and goals. Given their
forward-looking nature, these statements involve substantial risks,
uncertainties and potentially inaccurate assumptions and we cannot
assure that any outcome expressed in these forward-looking
statements will be realized in whole or in part. You can identify
these statements by the fact that they use future dates or use
words such as “will,” “may,” “could,” “likely,” “ongoing,”
“anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,”
“believe,” “assume,” “target,” “forecast,” “guidance,” “goal,”
“objective,” “aim,” “seek,” “potential,” “hope” and other words and
terms of similar meaning. Pfizer’s financial guidance is based on
estimates and assumptions that are subject to significant
uncertainties.
Among the factors that could cause actual results to differ
materially from past results and future plans and projected future
results are the following:
Risks Related to Our Business, Industry
and Operations, and Business Development:
- the outcome of research and development (R&D) activities,
including, the ability to meet anticipated pre-clinical or clinical
endpoints, commencement and/or completion dates for our
pre-clinical or clinical trials, regulatory submission dates,
and/or regulatory approval and/or launch dates; the possibility of
unfavorable pre-clinical and clinical trial results, including the
possibility of unfavorable new pre-clinical or clinical data and
further analyses of existing pre-clinical or clinical data; risks
associated with preliminary, early stage or interim data; the risk
that pre-clinical and clinical trial data are subject to differing
interpretations and assessments, including during the peer
review/publication process, in the scientific community generally,
and by regulatory authorities; and whether and when additional data
from our pipeline programs will be published in scientific journal
publications and, if so, when and with what modifications and
interpretations;
- our ability to successfully address comments received from
regulatory authorities such as the FDA or the EMA, or obtain
approval for new products and indications from regulators on a
timely basis or at all; regulatory decisions impacting labeling,
including the scope of indicated patient populations, product
dosage, manufacturing processes, safety and/or other matters,
including decisions relating to emerging developments regarding
potential product impurities; uncertainties regarding the ability
to obtain, and the scope of, recommendations by technical or
advisory committees; and the timing of, and ability to obtain,
pricing approvals and product launches, all of which could impact
the availability or commercial potential of our products and
product candidates;
- claims and concerns that may arise regarding the safety or
efficacy of in-line products and product candidates, including
claims and concerns that may arise from the outcome of
post-approval clinical trials, which could impact marketing
approval, product labeling, and/or availability or commercial
potential;
- the success and impact of external business development
activities, such as the December 2023 acquisition of Seagen,
including the ability to identify and execute on potential business
development opportunities; the ability to satisfy the conditions to
closing of announced transactions in the anticipated time frame or
at all; the ability to realize the anticipated benefits of any such
transactions in the anticipated time frame or at all; the potential
need for and impact of additional equity or debt financing to
pursue these opportunities, which has in the past and could in the
future result in increased leverage and/or a downgrade of our
credit ratings and could limit our ability to obtain future
financing; challenges integrating the businesses and operations;
disruption to business and operations relationships; risks related
to growing revenues for certain acquired or partnered products;
significant transaction costs; and unknown liabilities;
- competition, including from new product entrants, in-line
branded products, generic products, private label products,
biosimilars and product candidates that treat or prevent diseases
and conditions similar to those treated or intended to be prevented
by our in-line products and product candidates;
- the ability to successfully market both new and existing
products, including biosimilars;
- difficulties or delays in manufacturing, sales or marketing;
supply disruptions, shortages or stock-outs at our facilities or
third-party facilities that we rely on; and legal or regulatory
actions;
- the impact of public health outbreaks, epidemics or pandemics
(such as COVID-19) on our business, operations and financial
condition and results, including impacts on our employees,
manufacturing, supply chain, sales and marketing, R&D and
clinical trials;
- risks and uncertainties related to our efforts to continue to
develop and commercialize Comirnaty and Paxlovid or any potential
future COVID-19 vaccines, treatments or combinations, as well as
challenges related to their manufacturing, supply and distribution,
including, among others, the risk that as the market for COVID-19
products continues to become more endemic and seasonal, demand for
our COVID-19 products has and may continue to be reduced or not
meet expectations, or may no longer exist, which has and may
continue to lead to reduced revenues, excess inventory on-hand
and/or in the channel which, for Paxlovid and Comirnaty, resulted
in significant inventory write-offs in 2023 and could continue to
result in inventory write-offs, or other unanticipated charges;
challenges related to the transition to the commercial market for
our COVID-19 products; uncertainties related to the public’s
adherence to vaccines, boosters, treatments or combinations; risks
related to our ability to accurately predict or achieve our revenue
forecasts for Comirnaty and Paxlovid or any potential future
COVID-19 vaccines or treatments; and potential third-party
royalties or other claims related to Comirnaty or Paxlovid;
- trends toward managed care and healthcare cost containment, and
our ability to obtain or maintain timely or adequate pricing or
favorable formulary placement for our products;
- interest rate and foreign currency exchange rate fluctuations,
including the impact of currency devaluations and monetary policy
actions in countries experiencing high inflation or deflation
rates;
- any significant issues involving our largest wholesale
distributors or government customers, which account for a
substantial portion of our revenues;
- the impact of the increased presence of counterfeit medicines,
vaccines or other products in the pharmaceutical supply chain;
- any significant issues related to the outsourcing of certain
operational and staff functions to third parties;
- any significant issues related to our JVs and other third-party
business arrangements, including modifications or disputes related
to supply agreements or other contracts with customers including
governments or other payors;
- uncertainties related to general economic, political, business,
industry, regulatory and market conditions including, without
limitation, uncertainties related to the impact on us, our
customers, suppliers and lenders and counterparties to our
foreign-exchange and interest-rate agreements of challenging global
economic conditions, such as inflation or interest rate
fluctuations, and recent and possible future changes in global
financial markets;
- the exposure of our operations globally to possible capital and
exchange controls, economic conditions, expropriation, sanctions
and/or other restrictive government actions, changes in
intellectual property legal protections and remedies, unstable
governments and legal systems and inter-governmental disputes;
- the impact of disruptions related to climate change and natural
disasters, including uncertainties related to the impact of the
tornado at our manufacturing facility in Rocky Mount, NC in
2023;
- any changes in business, political and economic conditions due
to actual or threatened terrorist activity, geopolitical
instability, political or civil unrest or military action,
including the ongoing conflicts between Russia and Ukraine and in
the Middle East and the resulting economic or other
consequences;
- the impact of product recalls, withdrawals and other unusual
items, including uncertainties related to regulator-directed risk
evaluations and assessments, including our ongoing evaluation of
our product portfolio for the potential presence or formation of
nitrosamines;
- trade buying patterns;
- the risk of an impairment charge related to our intangible
assets, goodwill or equity-method investments;
- the impact of, and risks and uncertainties related to,
restructurings and internal reorganizations, as well as any other
corporate strategic initiatives and growth strategies, and
cost-reduction and productivity initiatives, each of which requires
upfront costs but may fail to yield anticipated benefits and may
result in unexpected costs, organizational disruption, adverse
effects on employee morale, retention issues or other unintended
consequences;
- the ability to successfully achieve our climate goals and
progress our environmental sustainability and other ESG
priorities;
Risks Related to Government Regulation and
Legal Proceedings:
- the impact of any U.S. healthcare reform or legislation or any
significant spending reduction or cost control efforts affecting
Medicare, Medicaid or other publicly funded or subsidized health
programs, including the Inflation Reduction Act of 2022, or changes
in the tax treatment of employer-sponsored health insurance that
may be implemented;
- U.S. federal or state legislation or regulatory action and/or
policy efforts affecting, among other things, pharmaceutical
product pricing, intellectual property, reimbursement or access or
restrictions on U.S. direct-to-consumer advertising; limitations on
interactions with healthcare professionals and other industry
stakeholders; as well as pricing pressures for our products as a
result of highly competitive biopharmaceutical markets;
- legislation or regulatory action in markets outside of the
U.S., such as China or Europe, including, without limitation, laws
related to pharmaceutical product pricing, intellectual property,
medical regulation, environmental protections, reimbursement or
access, including, in particular, continued government-mandated
reductions in prices and access restrictions for certain
biopharmaceutical products to control costs in those markets;
- legal defense costs, insurance expenses, settlement costs and
contingencies, including without limitation, those related to
actual or alleged environmental contamination;
- the risk and impact of an adverse decision or settlement and
risk related to the adequacy of reserves related to legal
proceedings;
- the risk and impact of tax related litigation and
investigations;
- governmental laws and regulations affecting our operations,
including, without limitation, the Inflation Reduction Act of 2022,
changes in laws and regulations or their interpretation, including,
among others, changes in tax laws and regulations internationally
and in the U.S., the adoption of global minimum taxation
requirements outside the U.S. generally effective in most
jurisdictions since January 1, 2024, and potential changes to
existing tax law by the current U.S. Presidential administration
and Congress, including the House-passed bill called “Tax Relief
for American Families and Workers Act of 2024”;
Risks Related to Intellectual Property,
Technology and Security:
- any significant breakdown or interruption of our information
technology systems and infrastructure (including cloud
services);
- any business disruption, theft of confidential or proprietary
information, security threats on facilities or infrastructure,
extortion or integrity compromise resulting from a cyber-attack,
which may include those using adversarial artificial intelligence
techniques, or other malfeasance by, but not limited to, nation
states, employees, business partners or others;
- risks and challenges related to the use of software and
services that include artificial intelligence-based functionality
and other emerging technologies;
- the risk that our currently pending or future patent
applications may not be granted on a timely basis or at all, or any
patent-term extensions that we seek may not be granted on a timely
basis, if at all; and
- risks to our products, patents and other intellectual property,
such as: (i) claims of invalidity that could result in loss of
exclusivity; (ii) claims of patent infringement, including asserted
and/or unasserted intellectual property claims; (iii) claims we may
assert against intellectual property rights held by third parties;
(iv) challenges faced by our collaboration or licensing partners to
the validity of their patent rights; or (v) any pressure, or legal
or regulatory action by, various stakeholders or governments that
could potentially result in us not seeking intellectual property
protection or agreeing not to enforce or being restricted from
enforcing intellectual property rights related to our products,
including Comirnaty and Paxlovid.
Should known or unknown risks or uncertainties materialize or
should underlying assumptions prove inaccurate, actual results
could vary materially from past results and those anticipated,
estimated or projected. Investors are cautioned not to put undue
reliance on forward-looking statements. A further list and
description of risks, uncertainties and other matters can be found
in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2023 and in our subsequent reports on Form 10-Q, in
each case including in the sections thereof captioned
“Forward-Looking Information and Factors That May Affect Future
Results” and “Item 1A. Risk Factors,” and in our subsequent reports
on Form 8-K.
This earnings release may include discussion of certain clinical
studies relating to various in-line products and/or product
candidates. These studies typically are part of a larger body of
clinical data relating to such products or product candidates, and
the discussion herein should be considered in the context of the
larger body of data. In addition, clinical trial data are subject
to differing interpretations, and, even when we view data as
sufficient to support the safety and/or effectiveness of a product
candidate or a new indication for an in-line product, regulatory
authorities may not share our views and may require additional data
or may deny approval altogether.
The information contained on our website or any third-party
website is not incorporated by reference into this earnings
release. All trademarks mentioned are the property of their
owners.
Certain of the products and product candidates discussed in this
earnings release are being co-researched, co-developed and/or
co-promoted in collaboration with other companies for which
Pfizer’s rights vary by market or are the subject of agreements
pursuant to which Pfizer has commercialization rights in certain
markets.
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Pfizer (NYSE:PFE)
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Pfizer (NYSE:PFE)
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