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By Bhanvi Satija and Michael Erman
(Reuters) – Pfizer Inc on Tuesday suggested investors expand its non-COVID products, such as the new RSV Abrysvo vaccine, as falling demand for COVID-19 vaccines and remedies pushed the drugmaker to its first quarterly loss since 2019.
The company said last month it would request a one-time fee of $5. 6 billion to account for returns of millions of doses of its antiviral remedy Paxlovid, as well as stockpiles of the Comirnaty COVID vaccine, by the U. S. government.
Declining use of vaccines and anti-Covid products as the pandemic recedes has led to a 40% drop in Pfizer shares this year and may remain a drag going forward, analysts said. Shares were down about 1% through midday.
Pfizer will continue to struggle to meet its 2023 sales target, said Evan Seigerman, an analyst at BMO Capital.
Sales of Paxlovid and the vaccine made by Pfizer with its German partner BioNTech have boosted revenue to record levels over the past two years. However, annual vaccination rates have fallen dramatically and demand for treatments has plummeted as immunity levels have risen across the population.
“We’ve reorganized our COVID expectations,” CEO Albert Bourla said on a call to discuss quarterly results, adding that he believes earnings from those products will remain stable going forward.
Pfizer still expects a 6% to 8% profit expansion for 2023 for non-COVID products, with most coming in the second half of the year.
Bourla pointed to a 10% expansion this quarter for new and legacy non-COVID products, “and that positions us to have a pipeline in development. “
Sales of the recently introduced Abrysvo respiratory syncytial virus (RSV) vaccine were $375 million during the quarter.
“We’re just at the beginning of this launch. We were doing more than we thought,” said Angela Hwang, Pfizer’s chief advertising officer.
Despite this, Pfizer’s RSV vaccine lags behind GSK’s rival vaccine, which is the only one submitted through CVS, the largest pharmacy chain in the United States.
Pfizer, in an update, said its experimental mRNA flu vaccine worked as well as a legal flu vaccine at an advanced stage of volunteers between the ages of 18 and 64.
He said the vaccine met secondary endpoints for influenza A strains, but also for B strains of the virus.
The company also said it expects to know the medium-term danuglipron, an experimental anti-obesity pill, before the end of the year as it seeks to compete in the industry’s fastest-growing market.
Pfizer also hopes to extend its $43 billion deal with cancer treatment specialist Seagen, which has been approved in Europe and is under review by U. S. regulators.
Paxlovid sales fell 97% in the third quarter to $202 million, while vaccine revenue was $1. 31 billion, up from $4. 4 billion a year earlier.
Analysts had expected $1. 44 billion for the vaccine and $618. 20 million for Paxlovid, according to LSEG data.
Pfizer, which announced a $3. 5 billion cost-cutting program earlier this month, cut its 2023 sales forecast to $9 billion after agreeing to take over about 8 million Paxlovid treatments from the U. S. government.
Pfizer expects Paxlovid to remain available to Americans through the end of the year.
The company reported a net loss of 42 cents in the third quarter. Excluding specialty items, Pfizer reported a loss of 17 cents, with analysts’ expectations for a loss of 34 cents and a profit of $1. 78. consistent with the percentage consistent with a year ago.
Total profit of $13. 23 billion, up from $22. 64 billion a year ago.
(Reporting by Bhanvi Satija and Khushi Mandowara in Bengaluru and Michael Erman in New York; editing by Sriraj Kalluvila and Bill Berkrot)