Pfizer on Wednesday predicted that 2024 sales could be as much as $5 billion below Wall Street expectations, a move that top executives said provided a more reliable view of its COVID-19 business than this year, making with shares falling 9% to 10-. low of the year.

Revenue from Pfizer's COVID-19 vaccines and treatments, which peaked at $57 billion, is now expected to be $8 billion in 2024. This compares with $13 billion of dollars predicted by analysts and is lower than Pfizer's reduced forecast of $12.5 billion in 2023.

Pfizer's COVID-19 vaccine and treatment revenue, which peaked at $57 billion, is now expected to be $8 billion in 2024. (REUTERS/Dado Ruvic/Reuters)

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PFE PFIZER INC. 26.52 -2.06 -7.21%

Pfizer, Inc.

“We want to be conservative,” Pfizer CEO Albert Bourla said on a conference call with investors. “We want to be trustworthy so we don’t create uncertainty (again), which was the case, unfortunately, this year.”

The company also forecast adjusted earnings for 2024 in the range of $2.05 to $2.25 per share, below analyst expectations of $3.16.

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The drugmaker's shares, which have fallen more than 44% this year, fell 8.7% in morning trading and are expected to wipe out more than $14 billion in market capitalization if losses continue throughout the day.

Shares of Moderna and Pfizer's German vaccine partner, BioNTech SE, fell 5% each.

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The lower forecasts come a day after the drugmaker announced it would reorganize its oncology division to include the acquisition of Seagen. It also raised its cost-cutting target by $500 million on Wednesday.

The US pharmaceutical company expects annual revenue in the range of $58.5 billion to $61.5 billion, compared to analysts' average estimate of $63.17 billion, according to LSEG data.

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The COVID-19 vaccine and antiviral pill Paxlovid helped Pfizer generate more than $100 billion in revenue in 2022. Pfizer had originally forecast sales of $21.5 million in COVID sales for 2023, but had to scale back that forecast by more than 40%, to about US$12.5 billion. .

COVID-19 sales targets “likely represent a floor for 2024 sales,” said JP Morgan analyst Chris Schott.

Pfizer's Paxlovid

Paxlovid and the COVID-19 vaccine helped Pfizer generate more than $100 billion in revenue in 2022. (Joe Raedle/Getty Images/Getty Images)

The drop in sales of COVID products also forced Pfizer to launch a program to cut jobs and expenses, which is now expected to save at least $4 billion a year by the end of 2024.

Pfizer had said on Tuesday that chief commercial officer Angela Hwang would step down and that the company would reorganize its commercial businesses, not including oncology, into two divisions, one focused on the United States and the other on the rest of the world.

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Pfizer's $43 billion deal with cancer drugmaker Seagen, which is expected to close on Thursday, is expected to add $3.1 billion to revenue next year.

Citi analyst Andrew Baum said Pfizer management is acting with increasing urgency to address its stock's poor performance. However, the absence of promising high-potential assets makes things difficult for the company as several Pfizer products are expected to go off-patent in the coming years.

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