Pfizer’s inline guidance offers relief to weary investors

(Bloomberg) — Pfizer Inc. forecast 2025 sales and profit in line with analyst forecasts, a move to fend off claims from an activist investor that the drugmaker is mismanaged.

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Sales next year will be $61 billion to $64 billion, Pfizer said in a statement on Tuesday. Wall Street analysts polled by Bloomberg expected $63.2 billion. The company’s earnings outlook of $2.80 to $3 per share was also roughly in line with analysts’ expectations.

The forecast “balances conservatism with accessibility and room for modest improvement over the course of the year,” BMO Capital Markets analyst Evan Seigerman said in a note to clients.

Shares rose as much as 4.8% as of 10:39 a.m. in New York on Tuesday, after losing 12% this year through Monday.

Jeff Smith, CEO of Starboard Value LP, has publicly accused Pfizer of squandering its Covid successes and suggested that CEO Albert Bourla may need to be replaced. Bloomberg reported in October that Starboard had acquired a $1 billion stake in the company.

Pfizer shares have lost more than half their value since their peak in late 2021, when sales of pandemic products were still strong. Meanwhile, Bourla has completed a series of deals worth $70 billion, including last year’s purchase of cancer drug developer Seagen for $43 billion.

Starboard said Pfizer overspent on deals and had poor returns on its internal research.

Before the Starboard stake became public, Pfizer had announced $5.5 billion in cost-cutting plans. In late October, Bourla said he would do “whatever it takes” to maintain profit growth, and the company announced another $500 million in cost cuts on Tuesday.

Trump dinner

In November, Pfizer named oncology research chief Chris Boshoff as the company’s chief scientific officer starting next month. He’ll have a lot to overcome, as the company’s efforts to develop an obesity pill haven’t yielded much yet, even though the field is exploding. Meanwhile, a gene therapy for Duchenne muscular dystrophy also failed in a large trial in June.

In a conference call with analysts on Tuesday, Bourla spoke briefly about the recent dinner with President-elect Donald Trump and Robert F. Kennedy Jr., Trump’s nominee for health secretary. “The president is very proud of the work done” to develop Covid vaccines in record time in 2020, Bourla said.

While he declined to go into details of the dinner conversation, he said he has “developed a good relationship” with Kennedy and if the nominee is confirmed, “we will work with him.”

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