By Bhanvi Satija and Raghav Mahobe
(Reuters) – Pfizer Inc on Tuesday beat estimates for first-quarter revenue and profit, helped by steady demand for its COVID products and reaffirmed its annual earnings forecast as it banks on newer drugs to contribute to growth later this year.
The company has said it expects 2023 to be a low point for COVID product sales, before potentially returning to growth in 2024. First-quarter sales for both the vaccine and its antiviral pill came in above Wall Street estimates.
Still, Pfizer did not raise its full-year expectations and forecast significantly lower sales of COVID products in the second quarter.
Wells Fargo analyst Mohit Bansal said the intact COVID sales outlook was a positive surprise as he had expected Pfizer to lower that forecast.
Pfizer is pumping billions of dollars into research and to buy potential blockbuster assets to mitigate an anticipated $17 billion hit to revenue by 2030 from patent expirations for top drugs, and a decline in demand for its COVID products.
The company said on Tuesday it would become more balanced with allocating capital after a string of deals in the last two years once its recent $43 billion buyout of Seagen was completed.
Graphic: Pfizer’s recent string of deals Pfizer’s recent string of deals – https://www.reuters.com/graphics/PFIZER-RESULTS/akpeqjaqbpr/chart.png
Pfizer said it remains on track to achieve its goal of 7% to 9% non-COVID revenue growth this year and expects majority of that growth to occur in the second half, driven by newer drugs.
Citi analyst Andrew Baum said that Pfizer’s non-COVID revenue missed expectations for the quarter.
“The outlook for H2 should be brighter given anticipated launches,” said Baum.
Pfizer is preparing to launch its RSV vaccine as well as its ulcerative colitis and hair loss drugs by the end of this year, pending regulatory decisions in the United States.Â
Sales of its COVID-19 vaccine Comirnaty slumped 77% to $3.06 billion in the quarter, but topped estimates of $2.37 billion, according to Refinitiv data.Â
Antiviral treatment Paxlovid sales nearly tripled to $4.07 billion, also beating estimates of $3.13 billion, bolstered by strong demand in China during the quarter.Â
The drugmaker expects annual profit of $3.25 to $3.45 per share and COVID products sales of about $21.5 billion.
Overall revenues for the first quarter fell 29% to $18.3 billion, but topped estimates of $16.59 billion.
Excluding items, the U.S. drugmaker posted a better-than -expected profit of $1.23 per share.
Shares of the New York-based company rose marginally to $39.56 in early trading.
(Reporting by Bhanvi Satija and Raghav Mahobe in Bengaluru and Michael Erman in New York; Editing by Sriraj Kalluvila)
