Pfizer narrows full-year outlook, despite 4% drop in Q3 sales

Headline results for the third quarter:

  • Biopharma unit: $10.2 billion, up 3%
  • Upjohn unit: $1.9 billion, down 18%
  • Overall revenue: $12.1 billion (forecasts of $12.3 billion), down 4%
  • Profit: $2.2 billion, down 71%

Note: All changes are versus the prior-year period unless otherwise stated

What the company said:

"I am pleased with our performance so far this year, including our ability to maintain a steady supply of medicines to the patients who rely on them during these uniquely challenging times," remarked chief financial officer Frank D'Amelio. The executive added "in the first nine months of the year, our biopharma business grew 7% operationally, despite a COVID-19-related negative impact of approximately 2%, driven by the strong performance of many of our key brands."

Pfizer said the pandemic weighed down its third-quarter revenue by approximately $500 million, or 4%, hit by lower demand for some products in China, as well as unfavourable disruptions to healthcare visits for patients in the US, which negatively impacted prescribing patterns for certain products.

Other results:

  • Prevnar 13/Prevenar 13: $1.5 billion, down 4%, with boosted adult uptake in certain international markets due to "greater vaccine awareness for respiratory illnesses," while there was also some recovery in the US as people tried to make up for doses of the pneumococcal vaccine they missed in the second quarter
  • Ibrance: $1.4 billion, up 6%, including a gain of 9% in the US, driven by CDK class penetration and the drug's "market share leadership" in metastatic breast cancer, although sales were down 17% in Europe as a result of pricing pressures
  • Eliquis alliance revenue and direct sales: $1.1 billion, up 9%, driven by continued increased adoption in non-valvular atrial fibrillation, as well as oral anti-coagulant market share gains
  • Xeljanz: $654 million, up 9%, lifted by higher volumes in the US within the rheumatoid arthritis (RA) and psoriatic arthritis indications, as well as continued uptake in RA internationally, and to a lesser extent, ulcerative colitis in some developed markets
  • Lipitor: $356 million, down 25%, hit by lower revenues in China due to the impact of the country's volume-based procurement programme
  • Lyrica: $352 million, down 33%, with "significant" volume declines in the US attributed to multi-source generic competition that began in July 2019
  • Vyndaqel/Vyndamax: $351 million, up from $156 million in the prior year, with growth in the US at 101%, driven by the drugs' launches last year in transthyretin amyloid cardiomyopathy, while international sales gained 150%
  • Enbrel (outside the US and Canada): $321 million, down 23%, hit by continued biosimilar competition in most developed European markets, as well as in Japan and Brazil
  • Xtandi alliance revenue: $266 million, up 18%, driven by continued strong demand in metastatic and non-metastatic castration-resistant prostate cancer, as well as in metastatic castration-sensitive disease, which was approved in the US last December
  • Chantix/Champix: $223 million, down 19%, primarily reflecting expected lower demand resulting from reduced doctor's office visits in the US
  • Total biosimilars: $424 million, up 79%, driven by recent oncology biosimilar launches of Ruxience (rituximab), Zirabev (bevacizumab) and Trazimera (trastuzumab) in the US and other global markets, plus continued growth from Retacrit (epoetin zeta), mainly in the US

Looking ahead:

Pfizer now expects revenue in 2020 of between $48.8 billion and $49.5 billion, narrowed from a prior estimated range of $48.6 billion to $50.6 billion. Meanwhile, earnings per share are now predicted to be in the range of $2.88 to $2.93, compared with an earlier forecast of between $2.85 and $2.95. The drugmaker said its guidance reflects "an ongoing, gradual global recovery from the macroeconomic and healthcare impacts of the COVID-19 pandemic," and also assumes no revenue contributions from a potential COVID-19 vaccine.

Meanwhile, the company also said it continues to expect to close the pending merger of its Upjohn unit with Mylan in the fourth quarter.

Pipeline updates:

Pfizer disclosed that as of October 26, the Phase II/III study of its COVID-19 vaccine, which is being co-developed with BioNTech, has enrolled more than 42,000 people, with nearly 36,000 having received their second dose. Pfizer noted the trial's data monitoring committee has not yet conducted an interim efficacy analysis, but the company reiterated that it anticipates filing the vaccine candidate for emergency use in the US soon after reaching a two-month safety milestone, expected in the third week of November.

The company also disclosed that it is ending a Phase II study of the acetyl-CoA carboxylase inhibitor PF-05221304, which was being tested as a monotherapy treatment in non-alcoholic steatohepatitis for patients with liver scarring. However, the drug still appears to be active in combination trials. In addition, Pfizer is discontinuing a mid-stage trial evaluating the IRAK4 inhibitor PF-06650833 as a potential arthritis treatment, as well as the Phase I asset PF-06753512, a prostate cancer therapeutic vaccine.

What analysts said:

Healthcare investor Brad Loncar said it was difficult to know what to make of the fact that the COVID-19 vaccine study has not yet had its first interim analysis, which is supposed to be performed after 32 participants in the trial become infected with the novel coronavirus. "I think this means that the overall infection rate is a lot lower than Pfizer initially estimated," Loncar said.

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