Pfizer Drops Revenue Prediction, Plans Job Cuts

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Facts

  • Pharmaceutical company Pfizer has announced it will cut its full-year revenue forecast by 13% and trim $3.5B worth of jobs and expenses in the face of slower sales of its COVID vaccine and treatment.1
  • With demand for Comirnaty, a COVID vaccine, and the antiviral treatment Paxlovid down, [the New York City-headquartered] Pfizer estimates its 2023 revenue will fall to $58B to $61B, down from the $67B to $70B it previously predicted.1
  • The US government in the fourth quarter is expected to return approximately 7.9M courses of Paxlovid — due to waning demand — in exchange for credit on future courses.2
  • Pfizer said it will then be able to start supplying Paxlovid on the commercial market in January 2024.3
  • Shares in Pfizer fell more than 1% before the start of trading Monday, while vaccine competitor Moderna saw its shares slip almost 5%.4
  • In 2021 and 2022, Pfizer set revenue records by making more than $100M on the strength of developing its vaccine and treatment. Revenue from Comirnaty and Paxlovid passed $56B last year.1

Sources: 1Reuters, 2Bloomberg, 3The Wall Street Journal and 4ABC News.

Narratives

  • Narrative A, as provided by CNBC. A dip in demand for COVID jabs and treatments was predictable, but unfortunately, several factors contributed to Pfizer’s outlook worsening. Between people’s expected COVID fatigue and rampant misinformation about vaccines that continues to proliferate, it’s difficult to convince doubters to keep up with their protection. Supply and insurance snafus have also made it harder for the public to access Pfizer products and have made for a bumpy road for the Big Pharma titan.
  • Narrative B, as provided by MarketWatch. This is just an expected market correction after Pfizer set revenue records, and the pharmaceutical giant will be right back on track as it will be able to sell Paxlovid commercially starting late this year or earlier in 2024. The return of government stock will give Pfizer demand certainty, while people on Medicare and Medicaid, as well as those without insurance, will be able to obtain Paxlovid on the government’s dime. Pfizer has a bright future.

Predictions