Pfizer’s 2022 outlook falls short of Wall Street’s lofty expectations

Pfizer’s full-year outlook has fallen short of Wall Street’s bullish expectations, sparking a sell-off in shares of the drugmaker that has been at the forefront of developing Covid-19 vaccines and treatment.

The US company said it expected to generate record revenues of between $98 and $102bn this year, driven by $32bn sales of its Covid vaccine and $22bn in sales of its antiviral pill. This was below consensus forecasts of $103.2bn, according to FactSet, with analysts expecting vaccine sales of $34bn in 2022.

Pfizer forecast earnings of $6.35 to $6.55 per share in 2022, below consensus forecasts of $6.71 per share when adjusted for acquisition-related costs and other significant items.

Pfizer shares fell more than 4 per cent in premarket trading on Tuesday as investors looked past the company’s better than expected fourth-quarter profits.

Analysts said the outlook highlighted the significant challenge Pfizer faces in meeting lofty growth expectations, with some experts predicting the pandemic has peaked.

Kevin Gade, portfolio manager at Bahl & Gaynor, said the missed guidance on Covid products sales may reflect a conservative steer from Pfizer, as it tends to guide numbers on doses it has already contracted to sell. But it could also reflect that the pandemic had peaked and demand may be lower in the future for vaccines and boosters, he said.

“We applaud Pfizer for winning Covid, but can they take the dollars from here and improve the base business?” he said.

Pfizer has dominated the Covid vaccine market, with the messenger RNA jab that it developed with BioNTech grabbing 70 per cent market share in the US and EU. Its antiviral pill Paxlovid — a five-day oral treatment that significantly reduces the risk of death and hospitalisation from coronavirus — is now poised to become the top-selling Covid treatment.

This success has transformed the company, boosting the share price by more than 50 per cent over the past year and helping the company pivot to become a science-driven drug development company.

Albert Bourla, Pfizer’s chief executive, said the successful development and launch of the vaccine and antiviral pill had not only made a positive difference to the world but fundamentally changed Pfizer and its culture forever.

“Everywhere I look in the company, I see colleagues who are inspired by what we have achieved to date and filled with determination to be part of the next breakthrough that could change the world for patients in need,” he said.

Pfizer reported earnings per share of $1.08 for the fourth quarter when adjusted for acquisition-related costs and other significant items, ahead of analyst consensus forecasts of 87 cents per share. Fourth-quarter revenues of $23.8bn were slightly below forecasts of $24.2bn.

The company reported $81.3bn in revenue in 2021, up 95 per cent from the previous year.