On the back of a year of record sales, Pfizer is bracing for the impact as it expects revenue from Covid-19 to bottom 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 on an earnings call on Tuesday. of the company’s fourth quarter.
CEO Albert Bourla forecasts $13.5 billion in Comirnaty sales this year, down 64% from 2022, and just $8 billion in Paxlovid revenue, down 58% from 2022.
“We expect 2023 to be a transitional year in the United States,” he said on the call, adding that the company sold more doses of vaccine and treatment this year than it actually used. “This has led to an increase in government stocks that we expect to be absorbed in 2023, probably in the second half of the year. At that time, we expect to start selling Comirnaty through commercial channels at commercial prices.”
Only 15.5 percent of eligible Americans received bivalent booster doses, compared with 69.2 percent who completed the primary series, according to the latest data from the CDC. Last week, the FDA’s Vaccine Advisory Committee voted unanimously to “harmonize” the compositions of the Covid vaccine, meaning all new vaccine recipients would receive a bivalent shot, regardless of whether they have received the primary series.
Even so, only 31% of people in the US received a Covid vaccine this year, and Pfizer expects that number to drop to about 24% in 2023.
Bourla expects a similar slump in Paxlovid sales, due to the current government slack. According to ASPR data updated last week, states have about 4 million unused Paxlovid courses.
The anti-viral has significantly underperformed this year, missing Bourla’s previous full-year projections by just over $3 billion. However, Comirnaty appeared to be catching up, earning about $37.8 billion in global sales, or about $3.8 billion more than Bourla expected at the end of the third quarter.
“While patient demand for our Covid products is expected to remain strong throughout 2023, much of that demand is expected to be met by products delivered to governments in 2022 and recorded as revenue last year,” said CFO David Denton on the call.
Commercial pricing for both Comirnaty and Paxlovid will likely go into effect around the second half of this year, according to Bourla. While the pharmaceutical giant previously said it plans to charge between $110 and $130 for BioNTech’s partner shot (nearly quadrupling the price), chief commercial officer Angela Hwang said the team is still “preparing what these scenarios might look like.” of price” for Paxlovid and “will share more when the time is right”.
The Pfizer team expects Covid sales to pick up over the next couple of years, and if all goes to plan, a successful flu vaccine and Covid-19 combination “would bring the percentage of Americans receiving the Covid-19 vaccine closer to the percentage of people receiving flu shots, which is currently about 50%,” Bourla said. The company launched a Phase I study in November for an mRNA-based combination vaccine.
Lower Covid sales projections led Bourla to peg its full-year sales expectations in 2023 at $67 billion to $71 billion, down about 30% from 2022, which disappointed some analysts.
“The 2023 PFE guidance provided with 4Q22 results was disappointing despite the company talking about its 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 his foot on the gas. As the CEO put it in November, “It all depends on the future.”
That’s why it has allocated between $12.4 and $13.4 billion for research and development this year, up nearly 9 percent from last year. It’s all part of his effort to offset an expected $17 billion loss due to patent expirations between 2025 and 2030.
Last quarter, it unfolded ambitious plans to bring 19 new products or indications to market over the next year and a half. The chief executive highlighted some of those programs on Tuesday, including potential combined shots for flu, Covid-19 and RSV, an oral GLP-1 candidate for diabetes and obesity, and potential vaccines for Lyme disease and shingles.
Other programs, however, didn’t make the cut. Pfizer also revealed on Tuesday that it had terminated eight programs, including recifercept, an achondroplasia drug that was the centerpiece of Pfizer’s 2019 acquisition of Therachon, and two Paxlovid indications that failed their respective trials. Phase III.