Pfizer’s Albert Bourla explains ‘transition year’ for Covid products, with sales expected to hit a low point

On the heels of a year of record sales, Pfizer is bracing for shock as it expects revenue from Covid-19 to bottom out in 2023.

That’s due to lower compliance with vaccine recommendations, fewer primary vaccines being administered and a “significant” government supply expected to last through early this year, executives said Tuesday in the company’s fourth quarter. . Profits call.

CEO Albert Bourla anticipates $13.5 billion in sales from Comirnaty this year, down 64% from 2022, and just $8 billion in revenue from Paxlovid, down 58% from 2022.

“We expect 2023 to be a year of transition in the US,” he said on the call, adding that the company sold more vaccines and treatment doses this year than were actually used. “This resulted in a government inventory build that we expect to be absorbed sometime in 2023, probably in the second half of the year. Around that time, we hope to start selling Comirnaty through commercial channels at commercial prices.”

Only 15.5% of eligible Americans have received bivalent boosters, compared with 69.2% who completed their primary series, according to the CDC. latest data. Last week, the FDA’s vaccine advisory committee voted unanimously to “harmonize” covid vaccine compositions, meaning all new vaccine recipients would receive a bivalent shot, regardless of whether they received the primary series. .

Still, only 31% of people in the US received a Covid vaccine this year, and Pfizer expects that number to drop to around 24% by 2023.

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Bourla expects a similar drop in Paxlovid sales, due to existing unused government supply. According to ASPR data updated last week, states have about 4 million unused Paxlovid courses.

The antiviral underperformed significantly this year, missing Bourla’s previous full-year projections by just over $3 billion. However, Comirnaty appeared to pick up the slack, raking in an estimated $37.8 billion in global salesor about $3.8 billion more than Bourla predicted at the end of the third quarter.

“While patient demand for our Covid products is expected to remain strong through 2023, much of that demand is expected to be met with products that were delivered to governments in 2022 and recorded as revenue on last year,” CFO David Denton said on the call.

Angela Hwang

Commercial prices for Comirnaty and Paxlovid are likely to come into effect around the second half of this year, according to Bourla. While the pharmaceutical giant previously said it expects to charge between $110 and $130 for the injection associated with BioNTech (almost quadrupling the price), chief commercial officer Angela Hwang said the team is still “preparing what those pricing scenarios might look like.” for Paxlovid and “will share more at the right time.”

The Pfizer team expects Covid-19 sales to pick up over the next two years, and if all goes to plan, a successful combination of flu and Covid-19 vaccines “would bring the percentage of Americans receiving the vaccine closer to covid-19 to the share of people who get flu shots, which is currently around 50%,” Bourla said. The company launched a Phase I study for an mRNA-based combination vaccine in November.

Lower projected Covid sales led Bourla to set its full-year 2023 sales expectations at $67 billion to $71 billion, about 30% lower than 2022, disappointing some analysts.

“PFE’s 2023 guidance provided with 4Q22 results was disappointing despite the company’s speaking out about the financial outlook in recent weeks,” analysts at SVB Securities wrote in a note to investors on Tuesday.

However, when it comes to R&D investments, Bourla keeps its foot on the gas. As the chief executive said in November, “it’s all about what’s next.”

That’s why it’s allocating about $12.4 billion to $13.4 billion for R&D this year, nearly 9% more than last year. It’s all part of his effort to offset an expected loss of $17 billion due to patent expiration between 2025 and 2030.

Last quarter, it detailed ambitious plans to bring 19 new products or indications to market over the next year and a half. The chief executive officer highlighted some of those programs Tuesday, including potential combination shots for flu, Covid-19, and RSV, a GLP-1 oral candidate for diabetes and obesity, and possible vaccines for Lyme disease and shingles. .

Other shows, however, didn’t make the cut. Pfizer also revealed on Tuesday that it removed eight programs, including recifercept, an achondroplasia drug that was the centerpiece of Pfizer’s 2019 purchase of Therachon, and two Paxlovid indications that failed their respective Phase III trials.