Pfizer Clocks in With Biggest Revenue Gain in 2nd Quarter

Pharmaceutical companies demonstrated their resilience during the second quarter, with more than half of the big players scoring revenue gains, even in the face of high inflation, supply chain issues, the Ukraine war and other global disruptions. This performance demonstrated why, unlike many other industries, pharma can “take a licking and keep on ticking,” as the Timex slogan says.

Of the top 24 drug companies, 15 beat their revenue from the second quarter of a year earlier, and more than half surpassed their first quarter sales of 2022.

Accordng to Fierce Pharma, Barbara Ryan, a senior Life Sciences advisor at Ernst & Young, cited several reasons behind pharma’s relatively stellar performance.

"Pharma stocks have benefitted from both their strong fundamentals, and exceptional balance sheets, as well as the current economic challenges and uncertainties," she wrote in an email. "Specifically, the defensive nature of the sector and scarcity of compelling investment opportunities have contributed to the group’s outperformance."

Heading the list of revenue gainers was Pfizer Inc. (PFE, Financial) with a 47% increase, a big part of it coming from its Covid products. Sales of the antiviral drug Paxlovid and vaccine Comirnaty increased from $7.84 billion to $8.85 billion year over year. Of Pfizer’s $8.84 billion increase in revenue from 2021, $8.12 billion came from its Covid oral antiviral.

So what has happened to Pfizer shares since the end of July? It is down almost 6%. While the company’s Covid vaccine and drug are expected to contribute more than half of Pfizer’s expected sales of $100 million this year, the decline in share price is probably related to increased competition for a number of the company’s other key drugs.

Pfizer's Covid vaccine partner, BioNTech SE (BNTX, Financial), went in the opposite direction with a 40% drop in its year-over-year revenue from Comirnaty. The stock of the German company is down about 3% to just over $152 since the beginning of August.

The company taking the biggest revenue hit was Regeneron Pharmaceuticals Inc. (REGN, Financial), which saw sales of its Covid treatment REGEN-COV go from nearly $2.6 billion in the prior-year quarter to zero this year. The culprit was the drug’s ineffectiveness against the Omnicron variant. This led to the company stopping four clinical trials involving the antibody combination.

Saving the day for Regeneron were two of its big sellers, Eylea and Dupixent, which together clocked a 20% increase in revenue. That was enough for investors to bid the stock up more than 10% in the past six weeks.

Merck & Co. Inc. (MRK, Financial) was another benefactor of pandemic products. Its sales jumped 28% as revenue from its Covid antiviral Lagevrio climbed to $1.28 billion. The pharma giant’s other products were no slouches either, jumping 18% thanks to $5.3 billion in sales of its mega-blockbuster Keytruda.

Source: Fierce Pharma