Pfizer, Moderna among many biopharma giants to post Q1 sales declines, as Novo Nordisk led growth charge

Biopharma companies know well the pain of a patent cliff. But how about a COVID cliff?  

With demand for vaccines and other COVID-19 products plummeting, drugmakers who thrived during the pandemic have seen their sales decline significantly lately.

The effects of the COVID cliff were apparent over the last few weeks as companies reported their first-quarter results. Of 20 leading biopharma companies, just six saw their revenues increase in the first quarter of 2023 compared with the same period last year.

Taking the biggest hits in the quarter were the three companies that emerged with the most successful COVID vaccines. BioNTech and Moderna posted whopping revenue decreases of 80% and 69%, respectively, while Pfizer chalked up a sales decline of 29%.

GSK also saw a 29% decline in revenue, but a significant chunk of that came from the company’s spinout of its Haleon consumer health unit in July 2022. Excluding Haleon and sales of its COVID products, the company said it posted a sales increase of 10% in the quarter.

Eli Lilly saw an 11% decline in revenue. But take out of the equation the company’s COVID antibodies—which generated $1.5 billion in the first quarter of 2022—and Lilly said it had a 10% increase in the period.

Several other companies can chalk their declining revenue in the quarter to a drop in COVID products. Those drugmakers include Merck (-9%), Roche (-7%), AstraZeneca (-4%) and Gilead Sciences (-4%).

But there are other companies that can’t credit their drops to a fall in COVID products, including Viatris (-11%) and AbbVie (-10%), which is feeling the sting of its loss of patent protection for megablockbuster Humira.

Other companies to post revenue declines not attributable to COVID are Bristol Myers Squibb (-3%), Biogen (-3%), Amgen (-2%) and Bayer (-2%).

Novo Nordisk scores big in Q1    

Among the six leading biopharma companies with a revenue increase in the first quarter, Novo Nordisk, at 27%, was the only one with a double-digit increase. The performance was fueled by sales of its diabetes drug Ozempic, which increased by 63% to 19.6 billion Danish kroner ($2.9 billion), and obesity treatments Wegovy and Saxenda.

Expect the trend to continue for the company, Third Bridge analyst Lee Brown said in an email to Fierce Pharma. The analyst noted that there are more than 760 million people who are obese worldwide, with only 2% having been treated.

Other firms that grew sales in the first quarter were Takeda (9%), Johnson & Johnson (6%), Sanofi (6%), Novartis (4%) and Merck KGaA (4%).

The common thread with these companies is that none were major sellers of COVID products. By the first quarter of 2022, sales of J&J’s ill-fated vaccine had declined to $457 million. And, as pointed out by Brown, J&J saw an increased demand internationally for its COVID shot in the past quarter.

“Given the sheer size of J&J, its growth is incredibly impressive,” Brown wrote. 

Pharma market cap declines in Q1

Along with revenue drops in the first quarter, investors largely turned away from pharma as there was a cumulative drop in market cap for the top 20 companies of 3.4%, according to analysts with Global Data. The analytics company chalked up the decline to inflation and increased capital costs.

Unsurprisingly, COVID vaccine makers Pfizer (-20%) and Moderna (-14%) saw the largest market-cap drops. BioNTech, which was not included in the report because it is not a top-20 market cap company, saw its market value drop by 17% during the quarter.

The biggest market cap gainer was Bayer (23%), whose performance was fueled by the advancement of two phase 3 trials for its potential blockbuster asundexian, a blood thinner, and the announced departure of embattled CEO Werner Baumann. Replacing Baumann is former Roche pharma chief Bill Anderson, who's set to take the reins at Bayer on June 1.

Other companies with significant market cap increases in the quarter were Daiichi Sankyo (14%), Regeneron (14%), Sanofi (12%) and Vertex (9%).

The gains for Regeneron and Sanofi reflect the booming sales of Dupixent, which came to 2.32 billion euros ($2.5 billion) for a 43% increase from the first quarter of 2022. Also during the quarter, the companies showed data that could lead to a lucrative approval for Dupixent to treat chronic obstructive pulmonary disease.

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