Pfizer (PFE) has been aggressively trading and gaining FDA approval for new products and indications in recent years, but COVID-19 has generated tens of billions of dollars in profits over the past few years. (COVID-19) All of that has been overshadowed by the phenomenal success of the product. .
The company released its financial results on Tuesday, with mixed results. Earnings per share came in at $1.08, compared to an expected loss of $0.18, but revenue fell short of expectations at $14.4 billion, instead reporting $14.25 billion.
Wall Street is looking for the company's next big thing now that the company's surge in revenue from coronavirus products has taken a backseat, including $3.5 billion returned to the U.S. government for unused courses of Paxlobid treatment.
“With a lack of near-term catalysts and a pipeline lacking clear anchor assets, we see no clear path to a meaningful revaluation of the stock,” JPMorgan analysts said in a note Tuesday. Stated.
Pfizer CEO Albert Bourla has announced his next big move after completing the $43 billion acquisition of Seegen, an oncology company specializing in treatments using antibody-drug conjugates (ADCs). He said that the event has already arrived.
ADCs are gaining popularity in oncology because they serve as a less harmful way to treat cancer by delivering chemotherapy in a way that is less damaging to healthy cells.
“ADC technology is now the hottest thing in M&A. Every company is trying to find an ADC,” Bourla told Yahoo Finance. Only a single product can be added to the pipeline.
“I think Seagen is an anchor platform. With Seagen, you get a whole platform for multiple products,” he added.
And it's a platform that Pfizer is already familiar with, having launched its first product, Mylotarg, in 2000. However, Pfizer withdrew it from the market in 2010 after study results showed the doses used were more toxic than chemotherapy. In 2017, Pfizer successfully revived the drug in a reduced dose for use in cancer patients.
Analysts say Seagen's bet favors Pfizer in two ways. One, it gives the company a new blockbuster product (or several) in the pipeline built on its hot ADC platform, and it also fills multiple holes in revenue from patent expirations in the second half of 2016. It means it's useful. 10 years.
That's why Pfizer has furiously kept Wall Street apprised of its every move, both large and small, both in M&A and approvals.
“I don't think the Street is missing anything. I think the Street is disappointed because we've been below our initial expectations for COVID revenue. I'm just waiting to see how we perform. It's just there,” Bourla said.
However, the stock price does not reflect investors' optimism. At about $27 per share, the stock is well below pre-pandemic levels and has fallen more than 37% over the past year.
Investors are waiting to see if that happens, with Seagen's drug Padcev on track to bring in $3.1 billion in revenue this year. For the first time in several quarters, more analysts are recommending buying Pfizer after the company's results on Tuesday. There are currently 12 buy recommendations, 9 hold recommendations, and 1 sell recommendation.
Anjalee Khemlani is a senior health reporter at Yahoo Finance, covering all areas of pharma, insurance, care services, digital health, PBM, and health policy and politics.Follow Anjali on all her social media platforms @AjKhem.
Click here for a detailed analysis of the latest healthcare industry news and events impacting stock prices.
