NEW YORK – Pfizer on Tuesday reported that its fourth quarter 2023 revenues declined due to diminishing sales of COVID-19 products, but the firm is optimistic about advancing its therapeutic pipeline into new growth areas in 2024, especially its oncology portfolio.
One of the firm's priorities for this year is to become a leader in the oncology space, a goal that has been bolstered by its acquisition of Seagen last year, Pfizer CEO Albert Bourla said on a call to discuss Q4 2023 financial results on Tuesday. The recently closed $43 billion Seagen acquisition doubled the size of Pfizer's oncology pipeline and brought in Seagen's antibody-drug conjugate (ADC) development platform.
"Seagen's in-line medicines are expected to immediately enhance Pfizer's top-line growth and our combined portfolios provide the opportunity to lead in genitourinary cancers, be a leader in breast cancer, and deliver at least eight potential blockbuster products by 2030," Bourla said. "Oncology represents one of the largest and fastest growing therapeutic areas."
Pfizer is also expecting to achieve several milestones in 2024 within its precision oncology programs, including Phase III trial readouts for the estrogen receptor protein degrader vepdegestrant in second-line hormone receptor (HR)-positive breast cancer and for Braftovi (encorafenib) in first-line BRAF-mutant colorectal cancer. The firm also anticipates beginning a Phase III trial of its CDK4 inhibitor in breast cancer patients who have previously received a CDK4/6 inhibitor and starting up to eight first-in-human studies of new molecular entities, including four ADCs.
For the three months ended Dec. 31, Pfizer reported $14.25 billion in overall revenues, a 41 percent decrease compared to Q4 2022 revenues of $24.29 billion, driven largely by declines in COVID-19 products. Excluding the impact of COVID-19 products, its revenues grew 7 percent operationally. Despite the negative impact from COVID-19 products, the firm beat analysts' average revenue estimate of $13.30 billion for Q4.
In Q4, Pfizer reported $2.93 billion in revenues from its oncology business, a 3 percent decline from Q4 2022 revenues in that segment of $3.01 billion. Since the completion of the Seagen acquisition on Dec. 14, Pfizer CFO David Denton noted that the Q4 and full-year financial results include about $120 million in revenue from Seagen products. "The expectation [is] that Seagen will be a substantial growth contributor in 2024 and beyond," he said.
This was the first quarter that Pfizer reported revenues from Seagen's oncology products, including its two precision oncology treatments Adcetris (brentuximab vedotin), which is approved for several CD30-expressing blood cancers, and Tukysa (tucatinib), a treatment for HER2-positive breast and colorectal cancer. Pfizer reported $46 million in sales of Adcetris and $17 million in Tukysa sales in Q4.
Sales of Pfizer's top-selling cancer drug, the CDK4/6 inhibitor Ibrance (palbociclib) for HR-positive, HER2-negative breast cancer declined by 13 percent in Q4 2023 to $1.12 billion from $1.28 billion in Q4 2022.
Revenues of its first-generation ALK inhibitor Xalkori (crizotinib) for ALK-rearranged lung cancer also declined 12 percent to $91 million from $103 million over the same period. Countering Xalkori's declining revenues was Pfizer's newer ALK inhibitor Lorbrena (lorlatinib), which brought in $146 million in Q4 2023, a 53 percent increase compared to $95 million in the year-ago quarter.
Alexandre de Germay, Pfizer's chief international commercial officer, called out a particularly robust market opportunity for Lorbrena in China. "The proportion of the lung cancer that can benefit from Lorena in the worldwide communities were 1.7 percent, but in China, it's 7 percent," de Germay said. "We believe we have a huge opportunity. We're developing a plan to quickly get Lorbrena to those patients that could benefit in China."
Pfizer's BRAF and MEK inhibitor combination for BRAF V600E-mutant colorectal cancer and melanoma, Braftovi and Mektovi (binimetinib), saw mixed results in the fourth quarter. Braftovi sales were $57 million versus $37 million in Q4 2022, a 53 percent increase, while Mektovi sales were flat at $46 million.
While product revenues were mixed across Pfizer's oncology portfolio, Bourla believes its marketed products and pipeline have "a lot of strength" with the combination of Pfizer and Seagen's pipelines. He declined to share a long-term revenue target for the whole oncology segment but reiterated that Pfizer is expecting Seagen oncology products to record $10 billion in revenue by 2030.
Chris Boshoff, chief oncology officer at Pfizer, also highlighted that Pfizer will focus on advancing three modalities in its oncology pipeline: ADCs, small molecules, and bispecifics. "For now, we're focusing on those three modalities where we see significant opportunities for combinations," Boshoff said. "For example, with small molecules and ADCs, but also potentially in the future between ADCs and bispecifics."
Pfizer's adjusted net income for Q4 2023 was $593 million, or $.10 per share, compared to $6.55 billion, or $1.14 per share, in Q4 2022. Analysts expected a loss per share of $.20 in Q4.
For the full year, Pfizer's overall revenues were $58.50 billion, a 42 percent drop from $100.33 billion in 2022. Analysts' consensus revenue expectation was $54.17 billion.
The firm's oncology segment contributed $11.63 billion in revenue in 2023, a 4 percent dip from $12.13 billion in 2022. Ibrance was also the company's bestselling oncology product for the full year, recording $4.75 billion in revenue, a 7 percent decline compared to $5.12 billion in 2022.
Pfizer's adjusted net income for 2023 was $10.50 billion, or $1.84 per share, compared to $37.72 billion, or $6.58 per share, in 2022, which beat the $1.42 per share that analysts were expecting on average.
Previously, Pfizer was expecting that overall revenue in 2024 would fall between $54.5 billion and $57.5 billion and adjusted dilute EPS would be between $2.45 and $2.65. After factoring in the impact of the Seagen acquisition, Pfizer is now expecting overall revenue to be in the range of $58.5 billion and $61.5 billion and adjusted dilute EPS between $2.05 and $2.25.