Pfizer considers cost cuts as demand for Covid products wanes

Pfizer will launch a cost-cutting programme if demand for its Covid-19 products keeps underperforming expectations this autumn, the US drugmaker said on Tuesday, after sales for the vaccine and the pill slumped during the second quarter.

The company expects 2023 to be a low point for Covid product sales after windfall gains at the peak of the pandemic, and a potential return to growth next year.

Pfizer said on Tuesday it anticipates more clarity for Covid revenue in the second half on a likely rise in infections in the autumn season and the US switching to a commercial market for the products from government contracts. “To that end if our Covid-19 revenues are less than what we assumed we are prepared to launch an enterprise-wide cost-improvement programme,” chief financial officer David Denton said.

Pfizer employs approximately 5,000 people across five locations based in Cork, Dublin and Kildare

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Sales of the Covid-19 vaccine Comirnat, fell 83 per cent to $1.49 billion (€1.36bn) in the second quarter, but came in above analysts’ estimates of $1.40 billion. Revenue from its antiviral treatment Paxlovid tumbled 98 per cent to $143 million, compared with estimates of $1.08 billion.

Pfizer trimmed the upper end of its annual revenue forecast by $1 billion to $70 billion.

The drugmaker is also navigating damage to a warehouse at its Rocky Mount facility from a tornado, a narrower-than-expected recommendation for its RSV vaccine, as well as worries its recently-approved cancer drug Talzenna would reach a smaller-than-anticipated patient population.

Meanwhile, Pfizer is preparing for many of its top-selling drugs to be soon facing competition from cheaper generics and has responded through billion-dollar acquisitions such as a $43 billion deal for cancer-therapy specialist Seagen.

Total revenue for the second quarter fell 54 per cent to $12.73 billion, missing Refinitiv estimates of $13.27 billion.

Excluding items, Pfizer reported a profit of 67 cent per share, while analysts had expected 57 cent. The company’s shares fell marginally to $35.9 in early trading. – Reuters

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