Pfizer to become $100B behemoth next year thanks to COVID-19 drug and vaccine: analyst

The COVID-19 pandemic is creating a $100 billion pharma goliath.

Pfizer’s revenue could reach $101.3 billion in 2022, with major contributions coming from the company’s BioNTech-partnered COVID vaccine and an antiviral therapeutic that has shown stellar clinical data, SVB Leerink analyst Geoffrey Porges projected in a Monday note to clients.

That level of revenue would be unheard of in the pharma industry. Johnson & Johnson, the world’s largest biopharma company by revenue for years, recorded $82.6 billion revenue in 2020. Pfizer’s own revenue in 2018 clocked in at $53.7 billion before the separation of its consumer health franchise into a joint venture with GlaxoSmithKline in 2019.

Of the $101.3 billion, oral COVID drug Paxlovid could contribute $24.2 billion and COVID vaccine Comirnaty $29.7 billion, Porges figured.

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Paxlovid, when given to nonhospitalized patients within three days of symptom onset, cut the risk of COVID-related hospitalization or death by 89% compared with placebo in a late-stage trial, Pfizer said earlier this month. The drug is used in combination with HIV drug ritonavir.

Armed with the positive data, the New York pharma is seeking an FDA emergency use authorization for the drug. The U.S. government has bought 10 million courses for $5.29 billion.

Predicting revenues for COVID products can be difficult, Porges acknowledged, given uncertainties around the pandemic. The analyst used the stockpiling behavior around influenza antivirals such as Roche’s Tamiflu during the 2005-2007 period as a reference.

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Upper- to middle-income countries will be the main contributors to Pfizer's COVID drug revenue. The company has signed a licensing agreement with the Medicines Patent Pool, allowing 95 low- and middle-income countries to make their own versions of Paxlovid. In key target geographies for Pfizer, Porges expects governments will want to procure enough stockpile to cover 10% to 20% of their populations, a demand that he expects will unlikely be met in 2022 or 2023 because of capacity limitations.

Pfizer’s estimated 2022 production volume for Paxlovid is 50 million courses, while the entire stockpile demand is about 222 million courses, Porges noted.

Merck & Co. also has an oral COVID antiviral, the Ridgeback Therapeutics-partnered molnupiravir. In its own clinical trial, molnupiravir reduced the risk of hospitalization or death by about 50%. The Biden administration has signed contracts worth $2.2 billion to purchase 3.1 million courses of the drug.

Despite Paxlovid having shown better efficacy data, Porges conservatively only assigned 50% of government contracts to the Pfizer drug, plus 70% share in the commercial market when it gets a full FDA approval.

Overall, Paxlovid alone could give Pfizer $67.1 billion in cumulative sales in the four years leading up to 2024, Porges said, with seasonal revenue beginning in 2023.

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Beyond the new COVID antiviral opportunity, Pfizer is already reaping tens of billions from Comirnaty. The COVID vaccine just got another revenue boost as the FDA authorized its booster shots for all U.S. adults. Porges expects $107 billion cumulative sales for Comirnaty by the end of 2022 from an expected delivery of more than 13 billion doses.

As the two big COVID earners hike Pfizer’s top line, they’re also giving the New York pharma a big bundle of cash on its balance sheet. Pfizer’s total cash and marketable securities will swell from $29.7 billion at the end of September to $59.5 billion by year-end 2022, Porges estimated. The total could further rise to $76.1 billion if GSK successfully spins off the consumer health joint venture as planned in mid-2022.

Pfizer could use the money for “strategic purposes,” Porges said, indicating potential dealmaking.