Pfizer Sinks on Weak 2024 Forecasts, COVID Vaccine Slowdown

On Wednesday, Pfizer’s (PFE) stock plummeted to a 10-year low after the US drugmaker cut 2024 sales guidance amid declining COVID-19 vaccine demand.

Pfizer shares retreated by -6.72% to $26.66 apiece on December 13, followed by a -0.15% after-hour plunge to $26.62. Furthermore, analysts predict another -3.23% drop to $25.76 in the coming market session.

The pharmaceutical corporation revised its 2024 revenue forecast downward to $8.00 billion, -36.00% below the $12.50 billion expected this year. More importantly, the figure fell short of Wall Street’s $13.00 billion estimate by -38.46%, worrying investors.

Pfizer also anticipates median earnings per share (EPS) of $2.15 apiece, -31.96% lower than the $3.16 market consensus. CEO Albert Bourla said the estimates leaned on the conservative side to avoid the same uncertainty the company faced in 2023.

Critics argued that the biotechnology firm might have overdone its spending after a record revenue of $57.00 billion in 2022. It has shouldered significant debt to fund takeovers and paying them off may strain its operating finances.

Pfizer has aggressively used its COVID vaccine windfall to acquire companies while simultaneously expanding its businesses and eliminating competitors. This week, the company is set to finalize its purchase of cancer drugmaker Seagen for $43.00 billion.

Moreover, the drugmaker has increased investments in research and development (R&D) of other vaccines, such as one for respiratory syncytial virus (RSV). However, Pfizer’s RSV vaccine severely underperformed, becoming one of its biggest failures this year.

COVID Vaccine Fatigue Catches Pfizer Unprepared

Pfizer seemed to have underestimated the impact that widespread misinformation and growing anti-vaccine sentiment would have on its bottom line.

COVID-19 vaccination in the US continues to deteriorate, with only 17.00% of the eligible population receiving updated booster shots.

J.P. Morgan analysts predict a decline in COVID-19 vaccine sales in 2024. Additionally, they criticized the vaccine for its overly optimistic original 2023 sales forecast of $21.50 million.

Caught off guard, Pfizer scrambled to reduce expenses to maintain its operating capital at manageable levels. The firm recently laid off employees and cut spending, expecting to lead to $4.00 billion in savings by next year’s end.

Chief Commercial Officer (CCO) Angela Hwan has claimed accountability and announced plans to step down. In addition, Pfizer plans to reorganize some commercial businesses to improve efficiency.