3. Pfizer

Pfizer sign
Pfizer is seeking to slim down under CEO Albert Bourla, in part through merging its Upjohn unit with Mylan to create a new standalone company. (Tracy Staton)

Pfizer
2019 revenue: $51.75 billion
2018 revenue: $53.64 billion
Headquarters: New York, New York

Pfizer’s first year under new CEO Albert Bourla wasn't without its turbulence, but analysts and investors have reason to be carefully optimistic: Pfizer orchestrated some major changes in 2019, slimming down and investing heavily in core products as part of a newly-touted focus on research and new medicines. 

Pfizer’s revenue dipped 4% in 2019, totaling $51.7 billion compared with the previous year’s $53.6 billion. Though not ideal for Bourla’s first year at the helm, unavoidable blows like Lyrica’s patent expiration were bound to take their toll. Those generic rivals, plus competition from biosimilars and other copycat newcomers—familiar dilemmas for the company—accounted for a big portion of the revenue bite. Still, Pfizer held onto its third-place position among pharma companies by revenue in 2019.  

During his first month as CEO, Bourla promised to steer clear of big M&A deals on his path towards a leaner Pfizer. Megamergers could derail the company's progress, he said.

It was only a matter of time, however, before several smaller mergers and sales coalesced. 

Chief among these were Pfizer’s acquisition of Array Biopharma, completed on July 30, and its Mylan-Upjohn spinoffViatris, which boasts projected 2020 revenues of $19 billion to 20 billion, as well as the potential to help the company withstand generic pricing pressure in the future. Amid the COVID-19 pandemic and related delays at an overloaded FDA, however, that deal closure was put off until the second half of this year.

With the acquisition of Array—a deal that cost Pfizer a hefty $11.4 billion—the company is betting once more on oncology, securing the MEK inhibitor Mektovi and BRAF inhibitor Braftovi, which have earned approval for combined use to treat melanoma and colon cancer.

And in April, Pfizer won FDA approval for another Array colon cancer combo: Braftovi plus Erbitux. While a follow-up triplet therapy has shown promising results, some analysts see the Braftovi-Erbitux duo as the likely favorite because of its lower costs and fewer side effects.

Bourla also noted the completed acquisition of Terachon, a clinical-stage biotech company focused on rare diseases, in the company’s 2020 proxy statement. But he was quick to assure investors that the deals forged in 2019 were all strictly aligned with Pfizer’s stated ambition to transform itself into an innovative, science-focused company.  

On the sales front, Pfizer continued to enjoy success with Ibrance in the treatment of metastatic breast cancer. The company also managed to score a major victory with the May launch of its tafamidis franchise, Vyndaqel and Vyndamax, used to treat transthyretin amyloid cardiomyopathy (ATTR-CM). With sales figures originally projected around $1.5 billion, cardiologists are now predicting that the Pfizer treatment will bring in even more.

In shaving off low-margin generics, Pfizer reiterated its faith in the strength of its “core five” growth products: Vyndaqel, Ibrance, the immunology therapy Xeljanz, anticoagulant Eliquis, and pneumococcal vaccine Prevnar. Of the five, only Prevnar lagged in sales; the company's working on a follow-up version, Prevnar 20, that would target seven additional viral strains.

Meanwhile, Ibrance’s revenue grew 20%, Eliquis 23%, and Xeljanz 26%, benefiting from wider adoption in foreign markets and new indications for treatment, according to the company’s annual financial review.  

Xeljanz and Xtandi continued to eke out growth as well, despite safety concerns from the FDA. The two drugs were locked in an ebb and flow of setbacks and successes throughout the year, with Xeljanz ultimately faring slightly better at 26% growth worldwide, despite being slapped with a warning label by the FDA over blood clot concerns. Meanwhile, Xtandi won priority review from the FDA and went on to earn new indications in treating prostate cancer.  

In less favorable news, the costly expiration of Pfizer’s Lyrica patent hit on June 30. Revenue from the drug dropped 33% in 2019 as generic rivals gobbled up market share, and Enbrel suffered similarly under market pressure from biosimilars.

The good news? As Bourla pointed out, Pfizer now has some much-needed time to catch its breath, with no major patent expirations on the horizon until the mid-2020s. 

Analysts have been confident as well, with RBC Capital Markets analyst Randall Stanicky calling the Pfizer of 2019 a potential “best-in-class growth case,” thanks to its “smaller, more innovative base.” 

On an operational level, Pfizer weathered its share of difficulties, formalizing the closure of two sterile injectable plants in India and ultimately backing down from a disagreement over pension changes targeting workers in their Irish plants.

The plant closures in India marked a continuing trend of FDA scrutiny and production woes among the company’s supply of sterile injectables. The two legacy Hospira plants, originally acquired in 2015, had been a thorn in Pfizer’s side for some time, with the plant in Irungattuukottai, India, having been cited by the FDA for manipulating test results.

Pfizer did offer a generous severance package to the plants’ employees though, attempting to cushion the blow of the 1,700 jobs that were lost in the closures. Even amid efforts to correct issues at the plants, Bourla admitted that related shortages would extend into 2020.

Although Bourla began captaining Pfizer at the start of the year, former-CEO Ian Read remained close at hand, fulfilling the position of executive chairman throughout 2019. This new role wouldn’t last, however, as Read announced his retirement to take effect at the year’s close. He didn’t stray far from the company he once headed though, announcing a move to the new Mylan-Upjohn spinoff, Viatris, beginning this year.

3. Pfizer

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