Pfizer Inc. (PFE) revealed its strategic pivot in the competitive weight-loss market on Tuesday, targeting Amgen’s (AMGN) lead with a new hormone-blocking obesity drug.
Despite Pfizer’s strong third-quarter performance, the stock dipped slightly, trading at $28.81 in early market activity, with shares forming a flat base near a buy point of $31.54, as indicated by MarketSurge.
Pfizer previously disclosed two obesity treatments in its pipeline that mimic the GLP-1 hormone, aiding in appetite control and blood sugar stabilization.
On Tuesday, it announced a third drug focused on blocking the GIP hormone, a move that closely aligns with Amgen’s experimental drug, MariTide, which combines GLP-1 activity with GIP blocking.
Other competitors in the weight-loss space, such as Eli Lilly (LLY) with its Zepbound and Viking Therapeutics (VKTX), are also advancing similar dual-action hormone mimics.
In the weight-loss drug lineup, Pfizer’s lead candidate, danuglipron, is set for further trial results by Q1 2024.
However, Evercore ISI analyst Umer Raffat urged investors to focus more on Pfizer’s secondary GLP-1 pill, citing that danuglipron faces several challenges that could hinder its market potential.
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Pfizer’s Q3 Earnings Soar 387% Above Paxlovid Forecast, Exceeds Revenue Target
Pfizer’s quarterly earnings surpassed expectations, driven largely by its Covid-19 treatment Paxlovid. For the September quarter, Pfizer posted adjusted earnings of $1.06 per share, well above analyst projections of 61 cents and reversing last year’s loss.
Revenue reached $17.7 billion, outpacing Wall Street’s forecast of $14.92 billion, according to FactSet.
Paxlovid contributed $2.7 billion in sales, smashing estimates by 387%, noted David Risinger, an analyst at Leerink Partners.
Sales of Pfizer’s Comirnaty vaccine, developed in partnership with BioNTech, reached $1.42 billion, beating forecasts by 34%.
While Covid-related products led much of the earnings beat, Pfizer saw growth beyond the pandemic.
Excluding Paxlovid and Comirnaty, sales rose by 14% year-over-year, supported by strong performances from heart medication Vyndaqel, migraine treatment Nurtec, and cancer therapies Braftovi and Xtandi.
However, sales of Padcev, an oncology treatment acquired through Seagen, slightly missed analyst expectations, coming in at $409 million versus the projected $425 million.
Edward Jones analyst John Boylan expressed optimism for Padcev’s longer-term potential given its recent approval for use in combination therapies.
Boylan, who reiterated a buy rating on Pfizer stock, pointed to the unpredictability of Covid-19 sales due to fluctuating outbreak levels.
While acknowledging the cash-generation advantage of Covid-related products, he placed higher value on the sales growth from Pfizer’s other therapeutic areas.
As Pfizer reorients its strategy to capture share in the weight-loss drug market and strengthens its core product lineup, the company remains focused on managing growth amid evolving healthcare demand and an increasingly competitive pharmaceutical landscape.
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