Pfizer Q3 2023 Earnings Call Transcript

Quartr
Provided by Quartr
October 31, 2023

There are 16 speakers on the call.

Operator

Good day, everyone, and welcome to Pfizer's Third Quarter 2023 Earnings Conference Call. Today's call is being recorded. At this time, I would like to turn the call over to Francesca Di Martino, Chief Investor Relations Officer and Senior Vice President. Please go ahead, ma'am.

Speaker 1

Good morning, and welcome to Pfizer's earnings call. I'm Francesca Di Martino, Chief Investor Relations Officer. On behalf of the Pfizer team, thank you for joining us. This call is being made available via audio webcast@fizer.com. Earlier this morning, we released our results for the Q3 of 2023.

Speaker 1

Our earnings materials can be accessed on the IR website at investors. Pfizer.com. I'm joined today by Doctor. Albert Bourla, our Chairman and CEO Dave Denton, our CFO and Doctor. Michael Dolson, President, Pfizer Research and Development.

Speaker 1

Joining for the Q and A session, we will also have Angela Huang, Chief Commercial Officer and President, Global Pharmaceuticals business Amir Malik, our Chief Business Innovation Officer Doctor. Chris Boshoff, our Chief Oncology Research and Development Officer and Doug Linkler, our General Counsel. Before we get started, I want to remind you that we will be making forward looking statements. I encourage you to read the disclaimer on Slide 3. Additional information regarding these statements and our non GAAP financial measures is available in our earnings release and in our SEC forms 10 ks and 10 Q under Risk Factors and Forward Looking Information and Factors that May and future results.

Speaker 1

Forward looking statements on the call are subject to substantial risks and uncertainties, speak only as of the call's original date, and we undertake no obligation to update or revise any of these statements. With that, I will turn the call over to Albert.

Speaker 2

Thank you, Francesca. Hello, everyone, and thank you for joining Today, Pfizer continues to have a far reaching and positive impact on human health. Through the 1st 9 months of the year, more than 457,000,000 patients Around the world were treated with our medicines and vaccines. Compared with the 1st 9 months of 2022, we have reached more patients in several key And this figure serves as a testament to our leadership in innovation and our commitment to understanding and serving patients' During the Q3, we were encouraged by the continuous strong performance of Pfizer's non COVID products, with revenue from these products The RSV vaccine, this is called Abristo, contributed €375,000,000 in U. S.

Speaker 2

Revenue. With the recent approval of the maternal Pfizer is the only company with RSV vaccine approved for preventing RSV in older adults and in infants via maternal immunization. We believe Abrismo will be a significant and growing contributor to revenue as many customers have indicated to us that protecting both populations with one 18,000,000 adults over age 60 who are eligible for RSV vaccination and an estimated 1,500,000 pregnant women are eligible which were acquired in the Q4 of 2022 contributed $233,000,000 $85,000,000 in global revenues, respectively. For Nurtec, in the U. S, oral CGRPs represent about 17% of migraine market and the unmet need is high.

Speaker 2

We believe oral CRPs can ultimately be the first line therapy for migraine and could eventually account for as much as 40% of the overall migraine market. Primary Care is a clear source of Year to date, primary care health care providers wrote more than 6,100,000 prescriptions for Triptans Compared with approximately €1,000,000 for all our CGRPs, which highlights a significant potential opportunity for Boropin. Regarding Rita, there is significant burden of illness and unmet need for patients suffering from sickle cell disease. An While in the U. S, 95% of children survive to adulthood, 99% of children in other regions will die before they reach their 5th Thank you, Betsy, naming without even being energy diagnosed.

Speaker 2

Our Winstacol semi door products, Including Dintacal, Dintamax, Binmak recorded 47% operational growth globally compared to the Q3 of This growth was driven largely by continued strong uptake of the trans We estimate there are between 1,200,000 and 150,000 people suffering from for ATTR cardiomyopathy with the majority The largest unmet need continues to be the lack of general understanding and ability to diagnose this deadly disease, which is why we are focused on educational activities to expand the diagnosis And get appropriate patients on the treatment with the product as the proven standard of care. Such efforts Significantly contributed to this quarter's revenue increase in the U. S. And our Prevnar family of products, Prevenar 13 and Prevenar 20 saw global revenue rise 50% operationally compared with This increase was driven primarily by strong patient demand for Prevnar20 adult in the U. S, The U.

Speaker 2

S. Approval of Prevnar20 Pediatric and associated stalking and growth of Prevnar13 These were partially offset by anticipated Lower market share in the U. S. For Prevnar Pediatric due to competitive entry. Of note, Prevnar 20 adult Remains the category leading pneumoconfir machine for adults in the U.

Speaker 2

S. With a 95% market share in the 3rd quarter. Year to date, revenues for our non COLI products have grown 7% of operation, and we remain on track to deliver 6 operational revenue growth for these products for the full year. We continue to progress toward our Goal of executing an unprecedented number of launches of new products or indications. Recent milestones include U.

Speaker 2

S. And EU approvals and launch of Abrasive in pregnant individuals U. S. Approval and launch of Erlepispeo in relapsed Non small cell lung cancer, U. S.

Speaker 2

Approval of Versipiti for moderate to severe ulcerative colitis, We see approval of Liptullo for severe alopecia reaction and U. S. Approval of Kenbriar, the first Only PENDAVELA vaccine that provides coverage against the 5 most common serogroups causing meningococcal disease in adolescents and young adults 10 through 25 years of age. Today, we have now executed 13 of the 19 originally identified potential Launches with 4 other products approved and preparations being made for their launch. In fact, 5 of the The remaining potential launches have been largely derisked from a technical perspective.

Speaker 2

The only one remaining would be our MRNA Fluke Candidate. Given our recent positive results from our next generation mRNA flu COVID combination candidate and pending results For our 65 and older first generation First3 stand alone mRNA flu study, timing of our stand alone mRNA flu is now expected after 2024. If successful, our next generation mRNAfluid combination candidate is expected to market in 2025. Michael will share more about this program shortly. We remain excited about our proposed We gained unconditional antitrust clearance from the EC, and we continue to expect the transaction to close in late 2023 Or early 2024, subject to customary closing conditions, including clearance by the U.

Speaker 2

S. FTC. We have raised €31,000,000,000 in acquisition financing so far and continue to expect incremental 2,030 risk In excess of €10,000,000,000 and expected cost efficiencies of €1,000,000,000 to be realized by the end of year 3 post Without impacting any R and D program. With that, I turn it over to Dave. And after Dave, Michael will provide an update on our R and D pipeline.

Speaker 2

So Dave?

Speaker 3

Thank you, Robert, and good morning. Before I review this quarter's results, I'll address a couple of topics that have been top of mind with investors since our announcement on October 13. These topics relate to our future U. S. Government Associated with the amended agreement, the U.

Speaker 3

S. Government is expected to return an estimated 7,900,000 EUA labeled treatment courses and in return will receive a volume based credit At an approximate value of $4,200,000,000 at the end of 2023 for future treatment courses, Pfizer will also provide an additional 1,000,000 treatment courses into the U. S. Strategic National As a result of all of that, Pfizer has an obligation to deliver an estimated 8,900,000 treatment courses for which we will record an approximately $4,200,000,000 of revenue beginning in 20 $3,500,000,000 of net cost savings by the end of 2024 versus the midpoint of our August 1, 2023 SIA and R and D guidance. We expect $1,000,000,000 targeted savings in 2023 and expect an additional savings of at least $2,500,000,000 in 2024.

Speaker 3

In a moment, when I review the components of our full year 2023 guidance, you will see that we have lowered the midpoints So both our SI and A and R and D guidance ranges by $500,000,000 respectively. Now turning to the quarter. Our Q3 results, both top and bottom line, were significantly and negatively impacted by our COVID products. Revenues declined 41% operationally, the result of the decrease in both Paxlovid and Comergen sales, While adjusted diluted loss per share was also significantly impacted by $5,600,000,000 of non cash inventory write offs of COVID related inventories. I want to emphasize as Albert stated previously that the operational revenue growth Of our products in Q3, excluding both Paxlovid and Commerdi, were strong at 10%.

Speaker 3

Contributing to the strong performance Our newly approved RSV vaccine and the families of products associated with both Prevnar and Vindical. Additionally, our recently acquired products, Nurtec and Artrida also contributed to the strong performance. Our reported diluted loss Per share of $0.42 and adjusted diluted loss per share of $0.17 in the quarter are primarily the result of a decline in COVID and commercial sales and the non cash charge related to write offs of COVID related inventories. The inventory write off of $4,700,000,000 for PAXLOVID and $900,000,000 For commodity, negatively affected adjusted loss per share by $0.84 Foreign exchange movements had a de minimis unfavorable impact on 3rd quarter revenues and increased adjusted diluted loss per share by $0.04 or 2 Percent compared to LY. Now let me briefly touch on our full year guidance.

Speaker 3

Given we updated our full year revenue Yes. Guidance on October 13, I'm just going to hit a few of the highlights. Total company full year 20 3 revenues are expected to be in the range of $58,000,000,000 to $61,000,000,000 versus the previous range $67,000,000,000 to $70,000,000,000 Importantly, we continue to expect 6% to 8% full year operational Revenue growth for non COVID products year over year. And as anticipated, the majority of this growth is occurring in the second half of the year, given the I want to remind you that beginning in Q4, we will overlap Billing dollar non cash charge related to inventory write offs for our COVID products. Adjusted SI and A to be within a range of $11,900,000,000 to $12,900,000,000 The midpoints of both Ranges are now $500,000,000 lower than our original guidance.

Speaker 3

As a result of all these, the company now expects Full year adjusted diluted earnings per share to be in the range of $1.45 to 1 $0.65 per versus the original guidance range of $3.25 to $3.45 All additional components of our guidance are included in our press release that was issued earlier today. As discussed in prior quarters, Our capital allocation strategy is based on 3 core pillars. 1st is reinvesting in our business. 2nd is growing our dividends over time. And 3rd is making value enhancing share repurchases.

Speaker 3

In the 1st 9 months of 20 23, we invested $7,900,000,000 in internal R and D, returned $6,900,000,000 to Shareholders via our quarterly dividend and allocated approximately $43,000,000,000 towards the proposed CGM acquisition. Lastly, in addition to completing a $31,000,000,000 unsecured debt offering in Q2 of this year, we are ready to We expect to delever our capital structure following the completion of this transaction. And as we delever, we anticipate returning to a more balanced capital allocation strategy, inclusive of share repurchases. In closing, I want to reiterate that our Product portfolio remains very strong. We continue to be encouraged by the momentum of our non COVID products in Q3 and are committed to the Successful execution of our new product and indication launches.

Speaker 3

We expect the cost realignment program will improve our operating margin, enhancing long term shareholder value. And with that, let me turn it over to Michael.

Speaker 4

Thank you, Dave. Today, I will share important updates on our robust respiratory vaccine portfolio. Our respiratory These include our mRNA platform in partnership with BioNTech targeting highly variant viruses our subunit targeting viruses that remain relatively consistent season to season and our conjugate vaccine platform designed to help prevent bacterial infections. We have achieved FDA approvals of vaccines derived from each platform within the last year and aim to further Our leadership with additional vaccine candidates in development. Today, I would provide information on our standalone flu vaccine candidate, Flu COVID combination vaccine candidate and next gen pneumococcal vaccine candidate.

Speaker 4

We are pleased to announce that we achieved both primary endpoint in the 18 to 64 year old cohort of our ongoing Phase III flu trial. In the trial, our first gen mRNA flu This represents the 1st and only demonstration of efficacy and superiority for a mRNA based flu vaccine candidate. In this age cohort, efficacy was maintained through the trials end of season analysis with our candidate remain non inferior to the analysis considered both Influenza A and B cases collectively. The vast majority of cases recorded in A 65 year and older cohort that we previously shared in coragine T cell data for all four We expect to see over current seasonal flu vaccines, particularly those 65 and older. We expect a readout from this age group later this year.

Speaker 4

To address the lower D responses seen with our 1st gen standalone flu candidate, Pfizer created next Generations reformulations. These were incorporated into our mRNA flu candidate in combination With the Pfizer BioNTech COVID-nineteen vaccine, which I will review now. In positive Phase III Top line data announced last week, we observed that reformulation of the lead flu candidates resulted in improved immunosities against Intensive B allowing us to meet all criteria for advancement to Phase 3. In the trial, our lead candidate formulations Induced robust immune responses will point estimates for heometric knee and titer ratios that were consistent with criteria applied to approved Notably, point estimates for geometric mean titer rates used With selected candidate formulations, we're greater than 1 relative to their licensed comparator for all match The safety profile of the valuated candidate were consistent with Pfizer's Ontex COVID-nineteen vaccine. Following these positive immunoicity data, we plan to initiate the Phase 3 study in the coming months.

Speaker 4

Successfully developing a broad seasonal vaccine franchise anchored around the mod Flu mRNA vaccine is a key priority as it may allow us to tap into the nearly 50% annual Flu vaccination rate in the U. S. Adults. We are taking a differentiated approach in pursuit of this goal, Leveraging both mRNA and protein subunit technologies. Our development program includes I'll start by reminding you that this is the only PCV business with an FDA indication for pneumonia in adults, Providing protection specifically against pneumococcal pneumonia is critical.

Speaker 4

It's the most common form of pneumococcal disease in adults, Leading to 150,000 U. S. Hospitalization each year, the prevalence of nonbacteriumic pneumococcal Pneumonia is more than 15 fold greater than that of invasive pneumococcal disease in U. S. Adults 50 and older.

Speaker 4

Trebnar's Pneumonia indication is supported by the CAPITA trial, which was enabled by pneumococcal vaccine population and proprietary assay. These innovative characteristics make it challenging for others to conduct a similar study given the high level of pneumococcal To solidify this position, we are committed to pursuing continued innovation. Our goal is to potentially maximize valency and improve immunosities, while maintaining coverage of the serotypes clinically demonstrated To protect against pneumonia. In line with this commitment, we have been developing in a 4th generation PCB candidate That builds on the Prebna business 20 year plus years of innovation. Our next generation technology leverages Cutting edge conjugation, chemistry, caries and reformulation.

Speaker 4

Using these new proprietor vaccine technologies, we observed a Several fold improvement in select serotype immunoicity in a monovalent Phase I study. Based on these data, We're confident that when we move this technology into our multivalent 4th gen candidate, we have the potential to achieve increased valency with improved We are now advancing our 4th generation candidate into a 1st in human trial, which It's expected to begin in the Q4 of 'twenty three. Finally, I will leave you with our list of milestones and Call out the recent approval of Felicity for ulcerative colitis and Pembrea, the first pentavalent, meaning the Pfizer has delivered more than a dozen regulatory approvals this year alone. I'll also note the recent launches

Operator

And our first question will come from Robin Karnauskas with Truist Securities.

Speaker 5

Hi, thanks for taking my question. I think I have a picked your question on your new launches, which is extremely important for your growth. Are you seeing any impact given, I think, Vaccine fatigue that we've seen with COVID impacting RSV and pneumococcal vaccines. And how do you think about that impact As you think about 2023 2024, you think that will dissipate? Thanks.

Speaker 2

Thank you, Bert, for your questions. First of all, I think it's good when you have a portfolio. And we have a quite strong Because we have RSV, we have COVID and we have pneumococcal in the respiratory front. But I think the biggest impact will be when and if We have combination products. We think that combination products will because of their convenience, because of vaccines are preferred by payers 0 copay will increase basically the volumes and vaccination rates of all vaccines Combinations, so that consumers and physicians will have choice, which ones to administer always to the same convenience.

Speaker 2

I think we can go to the next question. Thank you very much, Rob.

Operator

Our next question will come from Hund Trung with UBS.

Speaker 6

Hi. Thanks for the questions. I have one on flu and then just one on Danu. So on flu, can you confirm the comparator in the 18 to 64 and also the 64 age groups was the low dose Flu vaccines. Is there a risk FDA is going to need data against high dose flu vaccines?

Speaker 6

And from a commercial Do you think you still need high dose flu data, the comparator against high dose And then on Danu, should we Just on the data that we expect before year end, what do you need to show in that in order to move it into Phase III trials? Is something similar to the Phase 2 we saw earlier this year enough to move it to Phase 3? Thanks very much.

Speaker 2

Thank you. On the Flucopharma, I can confirm that it is the low dose on the younger population because that's the only one that's allowed. So, on the older population, we are having studies now with the low dose, but we will do also with the higher dose. So we have both. On DANIEL, there's not much to say.

Speaker 2

We need to wait to see the data. There is clearly, when you are moving ahead with a program like that, you need to see the totality of the data. And we are working now or intensively to be able to have those

Operator

Our next question will come from Umer Raffat with Evercore.

Speaker 7

I wanted to continue on the oral obesity theme for a second. I noticed there's a new molecule 522 that you moved into Phase 1. And my question is, is the chemical structure and the chemical series akin to the DANIEL and LODIGLIFRAN programs? And also, Albert, you mentioned you want to wait I realize the trial has been wrapped up for a few weeks now. Have you not seen it yet?

Speaker 7

Thank you very much.

Speaker 2

Yes. Baikon, would you like to take the question about the new molecule and the dynein?

Speaker 4

Yes. We are building a platform around The GLP area and also obesity in general with multiple different mechanisms And compounds. We remain focused on the Danagliopron readout, as Albert mentioned, As our main opportunity here for getting data to review for obesity in type 2 diabetes. But There are many indications where CLIF may play a role outside of Triple Metaholics. So this one gives us just more option To explore and have interesting data and you will see more new mechanism also coming from Pfizer.

Speaker 4

We have a pretty strong effort here. Thank you.

Speaker 2

Thank you very much. Please go to the next call.

Operator

Next, we have Terence Flynn with Morgan Stanley.

Speaker 8

Hi. Thanks for taking the question. Maybe 2 for me. I was just wondering on your RSV launch, how we should think about the potential For revaccination in 2024. And then on your DMD gene therapy program, I think you've previously talked about having interim data By year end, is that still the case?

Speaker 8

And does the recent competitor data make you more or less optimistic in your program? Thank you.

Speaker 2

Thank you very much. First of all, let me make a comment on the recent data that we saw about the DMD patients. It's a very, very bad news for patients. We are really at least a patient relation that doesn't have solutions, I hope. There will be a solution for them with a discussion of D and D, but I can't comment.

Speaker 2

Now on our D and D program, I will ask Michael To comment on that. And then on the RSV, Angela. Michael, why don't you start with DMT and then I'll go to Arzic.

Speaker 4

Yes. I echo Albert's comment that we also always said and when someone fail a study. We are very encouraged about getting to the readout. You are right. There is an opportunity for an interim analysis Around year end with final analysis second half of next year.

Speaker 4

And overall, I I think our gene therapy for DMD have shown a very consistent effect across biomarkers and functional endpoint. And what has been So far is that when you look at the functional data we have reported, it has been giving encouraging Signals in both the younger and the slightly older boys, and that has not been seen with other company you referred to. So in a way, I remain as You're very positive about looking forward to the readout and let the data tell the story. But of course, this makes our gene therapy In a way, the main gain is hard.

Speaker 2

And then there was a question, Angela, on the RSV.

Speaker 9

Well, as you heard During the ACIP discussions, our recommendation for Brazil today is really One around shared clinical decision making. But we also were We're asked to bring additional data when they are ready. So just to confirm that we will have additional data in vaccine effectiveness in broader populations. All of this will be, I think, available in the next year when we plan to bring this back to the In addition to that, actually, I omitted to mention that we'll also have 2nd season efficacy data. So, we'll be able to bring this totality of data together to determine Whether the recommendations will change, but also what the vaccination schedule will be.

Speaker 9

So, that's to come in 20

Speaker 2

Thank you, Andrew. Let's go to the next question please.

Operator

Next, we have Steve Scala with TD Cowen.

Speaker 10

Thank you very much. As was just noted a couple of minutes ago, the DANIU data has reached its primary completion. It was a while ago. Albert, when you were asked, you stressed the words totality of the data, implying that you could have seen some part Michael, when you were asked, you talked about different indications. These are not confidence Building statements.

Speaker 10

So I'm curious what have you seen? And Michael, you've said in the past you were absolutely encouraged and Confident in the profile of Danube. Are you still absolutely encouraged and confident? So that's the first question. Secondly, a competitor spoke to potentially COVID derived decrease in diagnosis of inflammatory diseases such as UC.

Speaker 10

And I'm wondering if you've seen any of that. Thank you.

Speaker 2

Steve, I think you likely misunderstood My comments on the totality has nothing to do with any data that I have seen because I haven't, right? So the data have not presented to I don't think that the study has been completed yet. So I will ask also Michael to comment on that. But don't present anything on the totality of the data. What We are doing this.

Speaker 2

We are doing the release formulation, so which we'll make it once a day. There are multiple But we need to wait and see. We see how competitors are doing before deciding what we will do. But the most important thing is to see what is The efficacy and safety of the study, but will read out. So nothing to read in my comment on So, Michael, if you want to add Yes.

Speaker 4

I can just echo what you said so well there, Albert. We and I remain Very enthusiastic to look forward to see the data. We have not seen the final top line report coming yet. So today the study is still ongoing, but will be available before year end. Danuglipliron, as you know, some really interesting We got earlier today a question about new molecules that are coming in.

Speaker 4

And that's when I mentioned that our additional indications to pursue for such new molecules. And we also have new mechanisms that are validated as coming in, in oral versions. So, it just Punctuates our big effort we have around both this class and obesity and other disorders.

Speaker 2

So, In essence, he is still excited. Thank you very much, Michael. Let's go to the next question please.

Operator

Next, We have Louise Chen with Cantor. Hi. Thanks for taking my question. So I wanted to ask you on this 4th Generation, PCV, how much additional serotype coverage will you have? And then Also on Abrezza, will that be available to pregnant women in the pharmacy or do they have to go to their OBGYN?

Operator

And then

Speaker 2

Michael, you will take the PCV question and then you but also Angela very quickly. Abrito is available also in pharmacist.

Speaker 9

Yes. It's going to be available in pharmacists, in doctors' offices, in OBGYN offices. I think we have a real stocking advantage Dear Louise, because anyone just needs to stop one product for 2 indications for both populations. So I think the uptake to come and certainly the next few months being that it's the winter is when we begin to we believe we'll see some good uptake.

Speaker 4

And then Michael? On the PCB 4th generation, I hope you looked at Today's data and what you could see is that we are really the 1st company that have been able to put in place A whole set of new technology that can bring immune responses to a higher level than have been seen and that allow us to go with Even more comprehensive coverage than the current 20. I'm not going to give your curiosity an answer how many serotypes. I cannot tell you, it's considerable more than the 20. On DANU, we look at ondanubliplon As a once a day QD molecule, because of the reformulation technologies that we have put in place and Already generated some clinical data on and are now concluding.

Speaker 4

So that's really how we look up on dengliplifron. And we'll have Final data on the best combination option early next year. But as Albert said, we are just going to look forward to the efficacy data Later this year, so very exciting time.

Speaker 2

Thank you very much, Michael. Let's go to the next question.

Operator

Next, we have David Risinger with Leerink Partners.

Speaker 8

Yes, thanks very much. So I have another question on denuglifron since it Appears to be the company's number one pipeline candidate based upon your forecasts. So regarding the Phase 2b results That are expected soon. How should we expect Pfizer to share those results? And then with regard to the once daily formulation that you just mentioned, Michael, Will that be ready for the Phase 3 start assuming that the company moves to start Phase 3 shortly after the Phase

Speaker 2

I mean, the first question, given the importance So the market, we will start them with a press release. There may be a call or not. I don't but with the press release, we'll make it public available. Now Michael, You want to take the second part of the question, David?

Speaker 4

Yes. I can first echo what Albert and I said. We look forward with And you said to get the nugliptron obesity data later this year. And of course, as Albert said, Pending totality of reviewing everything we have, we have made a lot of progress and been able to accelerate the QD then. Now We're waiting for some more clinical data early next year, but I think it's within our reach if we decide to do To start the pivotal study next year to do it with once a day molecule.

Speaker 2

Thank you very much, Michael. Let's go to the next

Operator

Next, we have Chris Schott with JPMorgan. Great.

Speaker 11

Thanks so much. Just two for me here. First, can you just comment a little bit more on what we're seeing with Near Tech and the ramp relative to your expectations? And maybe just as part of that, just any color on pricing we're seeing within the market today and how we should think about that going forward? And then my second Question was on 2024.

Speaker 11

I know you're not giving guidance today. But as you look at where consensus has kind of shaken out post the COVID and cost Restructuring updates, I think the earnings are in kind of the low $3 range at this point. I guess just are there any directional kind of pushes or pulls in the numbers That you feel the Street isn't capturing properly and should be kind of thinking about before we get your kind of final formal guidance as we look to early next year? Thank you.

Speaker 2

Thank you. David,

Speaker 4

it was a little bit about

Speaker 2

24 guidance, but you're not going to tell us?

Speaker 3

Right. So obviously, it's little early for 2024. I will just say that clearly we had a clearing event as it relates Our COVID expectations for this year, so a lot of that risk is behind us as we think about the balance of this year. I do expect that the balance of this year will be very informative, particularly in the U. S.

Speaker 3

As we think about utilization trends, both For vaccination rates, importantly, PAXLOVID here in the U. S. That will allow us to I have a better clarity as we cycle into 2024 of the utilization around those specific products, which will still be meaningful At an enterprise level, clearly, when we get to providing guidance, we'll give you a lot of information beneath that, So you can get a good sense of our importantly, our non COVID products, which continue to trend very favorably and very well. If we can layer on, I'll say the optionality associated with our COVID franchise as we cycle into next year. So obviously a lot more to come.

Speaker 3

We're looking forward to sharing those various weekly details after the 1st of the year.

Speaker 2

Thank you, David. And then, Anders, about the Nurtec launch, Not a lot about the Newtek performance in the marketplace, including the price.

Speaker 9

Yes. So thanks for the question, Chris, Because it's a great opportunity for us to share that we are seeing Nurtec perform just as we expected, In fact, with some really strong performance indicators that I'd like to share with you. First of all, from a TRx perspective, we grew 28% compared to last year this time. And sequentially, we grew 6% versus last quarter. In fact, on October 20th, we saw the highest week of TRxs and NRxs to date.

Speaker 9

That growth is also seen in the number of prescribers. Just this quarter alone, we had 73,000 prescribers write with Merced. And we are now moving Another good place to look is also in new to brand starts, right, NBRxs. And when you look at that, NBRx growth for NERTECH is Higher than UBRLVI and COLLECTA in all the deciles of physicians, but particularly in the decile 8 to 10s, which as you know is where the highest prescribers Who are the highest prescribers? And then when you look at pill count, we see something interesting there too.

Speaker 9

We have been very intensely or intently Driving our pill pack towards the larger pill pack size, which is the 16 pack because of prevention indication. And so when you look at the totality of all the pills and the total volume of pills, we have a leading market share there more than 50%. And so, I think when you look at all these indicators, at least from the way that we're looking at it, it's a very positive story. It's exactly how we see it. The expansion into primary care, as you heard in Albert's comments, is what it is that we're after.

Speaker 9

And today, only 17% of the Our market is oral CGRPs, which tells you that most of the market is still an opportunity for us and represents Growth that we're really looking forward to. And I think that we put the right investments in the right places to generate this growth in the future. From a pricing perspective, obviously, this is it's a product that is rebalanced. And So, I think the way to think about it is that from a patient perspective, which is where we really put a lot of focus, we want to make sure that our patients are able to get these scripts, are able to get access for Nurtec, especially as you consider that we're trying to mobilize people away from tepiramate and away from So, the gross to net effects here are significant and you see that quarter over quarter, because we are making Sure that we are able to provide access to patients who deserve and are eligible for Notek.

Operator

Next, we have Mohit Bansal with Wells Fargo.

Speaker 12

Great. Thank you for taking my question. And have a question regarding your S1P efgartimod. Would love to get your thoughts from the label. It seems like I mean, you could avoid a lot of cardiac monitoring, but at the same time, there's this new requirement of like eye exam as well as skin exam.

Speaker 12

How do you think about uptake considering these examinations before the start of the treatment, Given that these doctors are not used to it.

Speaker 2

All right. Michael, quite a medical question. Would you like to answer

Speaker 4

it, please? I'm happy to start on it. I think we have a very robust label for Trasimod, it's the only S1P in this truck class fortress flight is Let's have a simple flat dosing and Immediate start without any prior need for, let's say, cardiac rhythm exams like the other All S1P have various iXNs to monitor. And I think our label similarly has a recommendation to do that. So it's really nothing New.

Speaker 4

And our efficacy data in UC has been very favorable. So, we are very optimistic that this can be True best in class with colitis. And

Speaker 6

then Anzal,

Speaker 2

do you want

Speaker 4

to add, Jesper?

Speaker 9

Sure. I was just going to add to that that Competitively, we believe that we have an excellent efficacy and efficacy profile. We don't have a need to titrate up, as Michael said. It also has there are assessments of standard versus our competitors at the initiation of therapy. So I think that this is A level playing field that we're in.

Speaker 9

Certainly, patient support is an area of focus for us, right, to ensure that patients are getting the assessments that they need. But we feel that we're this is pretty standard practice and we'll be able to launch this product as planned.

Speaker 2

Thank you very much, Antal. Next question please.

Operator

Next, we have Geoff Meacham with Bank of America.

Speaker 13

Good morning, everyone. Thanks for the question. Just have a couple of quick ones. First, I know CGen obviously hasn't closed yet, but does all the emphasis on ADCs from ESMO, Does it affect how you guys prioritize the pipeline or maybe investments you could make today commercially? And the second question on Danube.

Speaker 13

Michael, I know a lot has been asked on the upcoming data. But from a commercial So like where do you see the bigger opportunities for differentiation in metabolic? Is it really just oral administration in obesity? Or Do you guys look more aggressively at related indications like cardio, renal, etcetera? Thank you.

Speaker 2

Chris, if you want to take the question about season

Speaker 14

Thank you very much. Obviously, we remain very confident that we will close Cision towards the end of this year beginning next year. As you pointed out, there's a significant interest now in ADCs because of the potential that they could replace most of Great work with both the current approved ABCs from their laboratories. And as you've seen, 3 potential registration based trials just read out, With Patxift and with TepDAC, but also with their small molecule, TepDAC. They recently started 2 Phase 3 studies, 1 with dasitamab vedotin in combination with pembrolizumab In advance, metastatic, HER2 positive or HER2 low bladder cancer.

Speaker 14

This is a program that we're very excited about. So ready decitamab received previously greater therapeuticization in the U. S. And they also just about to start another Phase 3 program in non small Lung cancer with a B6A, integrin B6 antibody. So we remain very confident in their portfolio and the depth Of expertise by bringing to development and discovery of IDC.

Speaker 2

Thank you. And then, Michael?

Speaker 4

Yes. I think you asked about How could a new oral clip into obesity be Positioned for maximal attractiveness and using Ghana as one example, Pending, of course, our excitement to see the data. Well, clearly, as obesity and Increasing in out of primary care, particularly with impressive effects of these drug class on Obesity and Body Wave, all live agents in general are preferred. So I think once a day Drugs such as the new reformulated potential dandaglifloin would have an interesting role there. I think there is also a growing discussion among opinion leaders in the field that The patients regain weight when they stopped injectable.

Speaker 4

And in general, they are only available for maybe a year. So a normal agent that could be taken for a longer period could also play a really interesting role to maintain Body weight at a low level. And finally, you're absolutely right. The new data for this drug class suggests that patients could benefit from both cardiac and And oral agents allow you to build combination with drugs that already are used in this population, Such as S52 to protect the heart, etcetera. So I think that's why there is such a big interest in drugs in this class.

Speaker 4

So thank you for the question.

Speaker 2

Thank you. Next question please.

Operator

Next, we have Tim Anderson with Wolfe Research.

Speaker 11

Thank you. I have a couple of questions on ganaglifiran. The early data set showed a QTC signal. Do you think that was a red herring that won't show up in later data? To me, when I just think about drug classes and seeing QTC signals, It seems like it often persists in later data sets.

Speaker 11

And then second question on mRNA flu, you mentioned that safety It's the same as licensed vaccines. Does that mean tolerability was as well? I usually think of safety and tolerability as technically being

Speaker 2

Very good. Thank you very much for the questions, Michael. Both questions for you, Q2C, for Daniel and then tolerability on

Speaker 4

Yes. I mean, we have, I think, more than 1400 patients on danegliperone, and it's a very Safe drug. It's a very safe drug, and we look forward to the readouts and efficacy as we have said before year end. So that's very straightforward. MRNA Flu, you had a very good comment, particularly in Initial studies, tolerability is really what we focus on.

Speaker 4

And tolerability was Similar to standard of care available vaccines or the other mRNA vaccines experienced from Pfizer and We haven't really had any concerns about safety. So on both tolerability and safety, the statement

Operator

Next, we have Chris Shibutani with Goldman Sachs.

Speaker 11

Thank you. Two questions, if I may. On the cost savings program, you've been outlining what the plan is for 2024. But if we look at the pattern of The spending for R and D and SI and A in the quarter you just reported, I would observe that the magnitude of reduction in the R and D Ben, was greater than expected relative to SI and A. How should we be interpreting this number?

Speaker 11

Is there anything to read across in terms of the relative And then a question on Abresvo. 1st quarter sales were solid. Can you just elaborate how much may have been attributable to, for instance, inventory versus actual demand. If we look at prescription data, looks like from the retail setting, there's about 30% market share. Is this Similar to what you're observing in the broader market and how is this comparing with your expectation?

Speaker 11

Thank you.

Speaker 2

Let me ask David To answer the question about our R and D and S and A, Francisco and then Angela will take the 5 bridge.

Speaker 3

Yes. Hey, Chris. On the cost program, I would not read into the allocation of savings in 'twenty three as it relates So 'twenty four, obviously, we have a fairly robust program up and running today. We're working aggressively On those programs and beginning to implement those programs, as we cycle into 2024, we'll give you and the market Any color on how to think about those cost savings as we wrap into next year?

Speaker 2

Thank you. Angela?

Speaker 9

Sure. So, we're really pleased with our performance on Abrasil. It has exceeded our You first asked whether this is all about stocking and I can say that it isn't. Of course, there was stocking effect in the beginning, because this was a new vaccine, but we're also closely tracking vaccination rates and uptake. And what you see is that there is very fast We were that really benefit from the fact that this was approved and in market prior to the vaccination season actually So, I was able to write off of the coattails of flu vaccinations, which you know are very high, right September, October.

Speaker 9

We have about a 70% co administration rate. So these the performance we're seeing on Brazil is truly driven By vaccination. To your comment about market share, yes, we are seeing a similar market share to what you have That is because right now the retail setting is driving a lot of the vaccinations. But don't forget That that's not where all vaccinations are taking place. We also have non retail settings such as health systems, doctors' offices.

Speaker 9

Those are also Being engaged and those particular settings Pfizer actually has a leading preference. They are smaller in proportion, but still. So, I think we have to look at all channels of the market. Finally, I think that just from a momentum perspective, we expect things The vaccinations really are happening throughout this time now, October, November, December, a big vaccination month. From a where we are right now, RSV is only 5% of the entire vaccination rate of the eligible population.

Speaker 9

So, I think that the conclusion is we're very early in the innings of this launch. We're doing better than we thought. But that where we are going to be, I think is a place where there's tremendous opportunity for driving uptake In all the results, but also maternal, which as you know, we just got the approval for.

Speaker 2

Thank you. Next question, please.

Operator

Next, we have Carter Gould with Barclays.

Speaker 11

The questions, maybe go back to oral Danu. When we do get the Phase 2 data, what should our expectation be around communicating plans for a Phase 3, which I guess is just a quicker way of saying, what's a reasonable expectation for how quickly you could turn around the Phase 2 and start a Phase And how much work Pfizer has already done on that front? And then maybe just coming out of ESMO, on the back of the EV302 data and the response, Would Pfizer say that reaffirms their expectations or represents upside to their expectations when the deal was

Speaker 2

Thank you very much. On the time, let me take that so I can spare a little bit Michael's time. We are expecting the data to Before the end of the year and of course, it's an important event. So we will have to make it publicly known when we know the data. And of course, when we are ready With our Phase 3 and we hope that the data are good so that you can move in a Phase 3.

Speaker 2

And I hope that we are going to do it in an Speed is a presence in this battle between competing molecules, but we will announce our plans for Phase III. I know the interest Now let me move to Chris, so that we can discuss about the

Speaker 14

Yes. Thank you for raising 301. These were truly monumental data for the field of bladder cancer And as you pointed out with overall survival and medium progressive free survival nearly doubled, moving median overall Survival for this population now towards nearly towards 3 years. We expect the final data to be above longer than 31.5 months. So this just reaffirms our belief that antibody drug conjugates could become a standard Across the treatment paradigm for many, many different tumor types.

Speaker 2

Thank you very much. Next question.

Operator

Next, We have Akash Tewari with Jefferies. Hi, good morning.

Speaker 5

This is Ivy on

Operator

for Akash. Thanks for taking our questions. Our question is also on can you give us long. So for the 1st daily modified release version, is there any possibility to do a bridging study for XPD formulation. And also for JANU, I think as we've heard a lot of times on the call that the trial is marked As completed in October, I know you haven't seen the top line data.

Operator

So at this point, are we waiting for data from this lower 4 week Also would it be fair to say that you will have discontinued the program already if there were any clinically

Speaker 2

Marc?

Speaker 6

Yes.

Speaker 4

On the once a day reformulated Danu, we have initially tested a standard add our core technology and could show that it works very well with ANU. And now to We're able also to incorporate a more sophisticated technology. We work on a matrix technology and all data suggests it's going to be And really intriguing alternative because as you know in diabetes, oral drugs And obesity, you will over time end up with incorporating different drugs to prevent different downstream effects. That's the beautiful of having this type of novel technology that you have a potential in the future to go to fix those combination. And we are really masters That's in developing sophisticated formulations.

Speaker 4

And we will have this available in 2024.

Speaker 2

And there was a

Operator

Next, we have Kerry Holford Ferd with Berenberg.

Speaker 7

Thank you. Two questions on vaccines for me, please. Firstly, on RSC, in August, GSK filed a lawsuit against Pfizer alleging Patent infringement. So I wonder if you can just talk to the next steps here, perhaps the time line that you anticipate And should we think that this could ultimately result in some form of royalty payment from Pfizer to GSK? And then on pembroja, how does the recent ACIP recommendation sit against your expectations The sales ramp and peak potential for this vaccine, if the vaccine is effectively only used For dose 2 of 3, does that significantly reduce the commercial opportunity you had anticipated for the

Speaker 2

Yes. Doug, can you please answer the question about this Legal on the situation with Ciscay?

Speaker 3

Yes. So it's very, very early stages with respect to The RSP litigation, we have patents. We feel strongly about our own intellectual property. And it's certainly too early to Say whether one party or the other will be required to pay any royalties or otherwise, very early

Speaker 2

Thank you. And answer about the Netherlands how you feel about it?

Speaker 9

Sure. We continue to feel confident about the peak sales. The reason is that right now we have the first set of recommendations, but ACIP has also told us that we'll have the opportunity again to Come back next year when we have additional data, which is when we'll have the opportunity to look at the schedule for I feel like it's great that we have an opportunity to get out now and to begin vaccinating teenagers. We'll have a second bite at the apple, which will allow us to achieve

Speaker 2

Thank you. Next question please.

Operator

Next, we have Andrew Baum with Citi.

Speaker 6

Thank you. A couple of questions. Would you comment on your stake in RBT3-1 hundred and one, the Tier 1A Pending the approval of the licensing of the asset To Roche, will you hang on to it or is that subject to divestment? And then second question for Chris. Just looking at the recent EV302 data and with You seem to have the CGM portfolio.

Speaker 6

When you think about the combination of ADCs with Pembro with a PD-one. Do you believe the efficacy that you're seeing is associated with bet hedging? Or do you think it's true Synergy through immunological mechanism and increased sellback. Thank you.

Speaker 2

Amir, do you want to speak a little bit about the Ross, acquisition of CL1.

Speaker 15

Yes. So thanks for the question, Andrew. I think we're very pleased with the outcome of the CL1A program, when we created Telefant, we did this as a R and D prioritization decision. Just as a reminder, this is a Phase 2 program that required Significant Phase 3 investment. And so we held on to a 25% stake.

Speaker 15

We also had rights to royalties on U. S. Sales as well as Full ex U. S. And ex Japan rights.

Speaker 15

And we did that all without any R and D spend. So Roche's proposed acquisition of Televant Will give us access to about $1,750,000,000 of pretax cash, which is the translation of our stake And we still retain all the other rights. So we're looking forward to having Roche as a partner. We're looking forward to the investments That they're going to make in advancing the clinical stage programs on CL-one hundred and eighty and benefiting from the outcome of those.

Speaker 2

And let Chris about the synergies.

Speaker 14

Thanks, Andrew. That's a very good question. As you know, Cajun pioneered MMAE or orostatin based payloads and we see this potential synergy In combination with the PD-one with ADCETRIS with TypDAC and recently as you've seen with APCETRIS, although CGM does have the next generation What appears to happen with the MMID or orestatin based payloads. So I think we're very confident that that season As both Topol 1 as well as our statin based pay notes encased with Topol 1s, we do not see what appears to be you correct,

Speaker 2

Thank you very much, Chris. And let's go to the last question, please.

Operator

Our last question comes from Evan Seigerman with BMO Capital Markets.

Speaker 13

Hi, guys. Thank you so much for taking my questions. So I have One on DANIEL and then a bigger picture one. The point of clarification on danglopron, Mikhail, is the ultimate goal to develop the fixed dose combination with say And SGLT-two or other anti diabetes drugs, you kind of had mentioned that in your commentary. And taking a big step back, How should we think about how you risk adjusted your long term revenue guidance?

Speaker 13

Did you plan on updating this figure, should you Clinical or regulatory successes or failures, for example, with the approval of astrazimod? Thank you.

Speaker 2

Michael, can you please take the timing question? Yes.

Speaker 4

I mean, the near term goal is we really look at the data With Zagros, Albert and myself. And pending review, of course, there's an option with a once a day download to move forward in Obesity diabetes. I think we just commented that the upside with oral drugs Our man in this sector, and that's why it has been such a big interest. And that includes fixed dose combination, which Not available with injectable. But we will keep it simple and clear.

Speaker 4

We'll review the data That's the deal, Tom. Thank you very much.

Speaker 2

And also about your question, if we are going to change the €20,000,000,000 or the €25,000,000,000 That we have declared. First of all, the €25,000,000,000 is €1,000,000,000 that we are going to acquire revenue from 2,030. According to our estimates, These acquisitions at the end of 2030 are very, very close to what we have right now. And I think this is trending very nice. When you see internal pipeline launches that we are having from our internal We declared at €20,000,000,000 There is a gap between what we believe and what the analysts And this is where we are focusing our attention.

Speaker 2

Right now, it is very early with the launches. Some of them are doing better than what we thought. Some of them are doing worse And what we thought. And if we realize that the total target of €20,000,000,000 is not anymore what we think will be, of course, we will have

Speaker 3

But I think what is important to that is if you look at our business, our core business is performing We continue to make traction. We have obviously a lot of launches that we've completed and still struggle ahead of us. We're excited about what CGen could potentially bring to the company as we think about our focus now in oncology. And then importantly, I think we've re baseline, if you will, the COVID franchise. As we think about utilization in the back half of this year and Next year, we will then take a step back and look at what would be prudent as we think about the revenue in totality of this

Speaker 2

With just one takeaway, should be that I think Pfizer's future remains bright. We have rebased our COVID expectations, and now I think it's And with the recent particularly with the recent amended tax quality of the supply agreement. And of course, we are having very strong performance Of our line and new products portfolio excluding COVID had 10% growth And that position us to be able to have a growing fleet going forward. So I will now bring this call to an end. Thank you for joining us and have a great rest of your day.

Operator

Thank you, ladies and gentlemen. This concludes today's Pfizer

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Earnings Conference Call
Pfizer Q3 2023
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