PFIZER INC

Pfizer Inc. is a research-based, global biopharmaceutical company that applies science and global resources to bring therapies to people through the discovery, development, manufacture, marketing, sale and distribution of biopharmaceutical products worldwide, working across developed and emerging markets to advance wellness, prevention, treatments and cures. The company supplies its medicines and vaccines to approximately 200 countries and territories, and revenues from operations outside the U.S. of $25.5 billion ¹ accounted for 41% ² of Total revenues in 2025. China was Pfizer's largest market outside the U.S. in 2025 and 2024, representing 5% ³ and 4% ⁴ of total revenues, respectively.

Pfizer operates in intensely competitive and highly regulated markets, facing competition from other worldwide research-based biopharmaceutical companies, smaller research companies with a more limited therapeutic focus, and generic drug and biosimilar manufacturers. The company competes on efficacy, safety, tolerability, ease of use and cost, and its competitors may devote substantial funds and resources to R&D that could result in erosion of sales of existing products and potential sales of products in development. Pfizer recorded revenues of more than $1 billion for each of 12 ⁵ products that collectively accounted for 65% ⁶ of Total revenues in 2025, with Eliquis alone accounting for 13% ⁷ of Total revenues.

Most of Pfizer's revenues come from the manufacture and sale of biopharmaceutical products. The company manages its commercial operations through a global structure consisting of three operating segments: Biopharma, Pfizer CentreOne (PC1), and Pfizer Ignite, with Biopharma being the only reportable segment. Biopharma is the innovative science-based biopharmaceutical business engaged in the discovery, development, manufacture, marketing, sale and distribution of biopharmaceutical products worldwide. PC1 is a contract development and manufacturing organization and a leading supplier of specialty active pharmaceutical ingredients, and Pfizer Ignite is an offering that provides strategic guidance and end-to-end R&D services to select innovative biotech companies, though in 2025 Pfizer made the decision to discontinue Pfizer Ignite and is winding down this business.

Within the Biopharma reportable segment, the Primary Care product portfolio includes internal medicine products such as Eliquis, the migraine product portfolio including Nurtec ODT/Vydura and Zavzpret, the vaccines portfolio including the Prevnar family, Comirnaty, Abrysvo, and FSME/IMMUN-TicoVac, and the COVID-19 treatment Paxlovid. The Specialty Care product portfolio includes the inflammation and immunology portfolio with Xeljanz, Enbrel (outside the U.S. and Canada), Cibinqo, Litfulo, Eucrisa, and Velsipity; the rare disease portfolio including the Vyndaqel family, Genotropin, BeneFIX, Xyntha, Somavert, Ngenla, and Hympavzi; and certain anti-infective and immunoglobulin medicines including Zavicefta (outside the U.S. and Canada), Octagam, and Panzyga. The Oncology product portfolio includes Ibrance, Xtandi, Padcev, Adcetris, Inlyta, Lorbrena, Bosulif, Tukysa, Braftovi, Mektovi, Orgovyx, Elrexfio, Tivdak, and Talzenna.

The Hospital and Biosimilars product portfolio includes off-patent branded and generic sterile injectables, oncology biosimilars such as Retacrit, Ruxience, Zirabev, Trazimera, and Nivestym, and biosimilars for chronic immune and inflammatory diseases, as well as sterile injectables including Sulperazon (outside the U.S. and Canada), Atgam, Fragmin, Solu Medrol, Solu Cortef, and Bicillin. Key collaboration and co-promotion arrangements include Comirnaty jointly developed and commercialized with BioNTech, Eliquis jointly developed and commercialized with BMS, Xtandi developed and commercialized with Astellas, Padcev co-developed and jointly commercialized with Astellas, Adcetris developed and commercialized with Takeda, and Tivdak commercialized in collaboration with Genmab.

In November 2025, Pfizer acquired Metsera, Inc., and in December 2023, the company acquired Seagen Inc. In 2025, Pfizer entered into in-licensing agreements with YaoPharma Co., Ltd. and 3SBio, Inc. in the obesity and cardiometabolic diseases and oncology therapeutic areas. In the fourth quarter of 2023, Pfizer launched a multi-year, enterprise-wide cost realignment program, and in the second quarter of 2024, the company launched a multi-year, multi-phased Manufacturing Optimization Program to reduce costs of goods sold. In September 2025, Pfizer announced an agreement with the Trump Administration to implement measures designed to make certain drug prices for U.S. patients more comparable to those in other developed countries and to participate in the TrumpRx.gov platform, which allows U.S. patients to purchase certain medicines at significant discounts to current retail prices, where the large majority of the Company's primary care treatments and some select specialty brands will be offered at savings that will range as high as 85% ⁸ and on average 50% ⁹; the agreement also provides a three-year grace period during which time Pfizer products will not face Section 232 tariffs, provided the Company further invests in manufacturing in the U.S. In the first quarter of 2025, Pfizer sold the remaining portion of its investment in Haleon for $6.3 billion ¹⁰.

Total revenues decreased $1.0 billion, or 2% ¹¹, to $62.6 billion ¹² in 2025 from $63.6 billion ¹³ in 2024, reflecting an operational decrease of $1.3 billion, or 2% ¹⁴, partially offset by a favorable impact of foreign exchange of $247 million ¹⁵. Excluding contributions from Comirnaty and Paxlovid, Total revenues increased 6% ¹⁶ operationally. Reported diluted EPS was $1.36 ¹⁷ in 2025, a decrease of 3% ¹⁸ compared to $1.41 ¹⁹ in 2024, while Adjusted diluted EPS (Non-GAAP) was $3.22 ²⁰, an increase of 4% ²¹ compared to $3.11 ²² in 2024. Net cash flow from operations was $11.7 billion ²³ in 2025, a decrease of 8% ²⁴ compared to 2024.

Pfizer's 2026 key priorities are: 1. Maximize value of key transactions, 2. Deliver on critical R&D milestones, 3. Invest to maximize post-2028 growth, and 4. Scale AI across the business. The company expects the impact from patent-based or regulatory exclusivity expiries in 2026 to be $1.5 billion ²⁵. For Comirnaty, in 2026 Pfizer expects market share in commercial markets and revenue phasing similar to 2025, primarily concentrated in the second-half of the year, though the company could see continuous decline in vaccination rates due to additional changes in vaccination recommendations, and the expected impact has been incorporated in its 2026 financial guidance. For Paxlovid, Pfizer expects a higher proportion of revenues to be delivered in the second-half of the year and revenues to fluctuate based on the timing, duration and severity of COVID-19 cases, with the expected impact of lower demand incorporated in its 2026 financial guidance.

Pfizer is focused on advancing its product pipeline, with R&D primarily focused on main therapeutic areas: oncology, internal medicine (including cardiometabolic, weight management and migraine), vaccines (with a pipeline focus on infectious diseases with significant unmet medical need), and inflammation and immunology. The company is continuing to make significant investments in breakthrough science for COVID-19, including evaluating Comirnaty and Paxlovid, investigating new variants of concern, developing variant adapted vaccine candidates, and exploring combination respiratory vaccines and next generation anti-infectives. In the obesity and cardiometabolic diseases area, Pfizer entered into an in-licensing agreement with YaoPharma in December 2025, and in the oncology therapeutic area, the company entered into an in-licensing agreement with 3SBio in July 2025. The acquisition of Metsera in November 2025 represents a significant investment in obesity, and the acquisition of Seagen in December 2023 represents a significant investment in oncology.

The Realigning Our Cost Base Program is expected to deliver total net cost savings of approximately $5.7 billion ²⁶ through 2026, composed of net cost savings of $5.1 billion ²⁷ achieved through 2025, and the remaining anticipated savings of $600 million ²⁸, primarily in SI&A, expected to be achieved by the end of 2026. In addition, Pfizer achieved cost savings of approximately $500 million ²⁹ from its pipeline focus and optimization initiatives including the expansion of its digital capabilities, with the savings expected to be reinvested in R&D programs by the end of 2026. The first phase of the Manufacturing Optimization Program is on track to deliver approximately $1.5 billion ³⁰ in net cost savings by the end of 2027, with approximately $600 million ³¹ of net cost savings realized by year-end 2025. In connection with the Seagen acquisition, Pfizer expects to generate approximately $1 billion ³² of annual cost synergies, to be achieved by the end of 2026, with approximately $800 million ³³ of annual cost synergies achieved by year-end 2025, and the one-time costs to generate these synergies are expected to be approximately $1.7 billion ³⁴, the majority of which has been incurred through 2025. In connection with the Metsera acquisition, Pfizer expects to generate approximately $600 million ³⁵ of annual cost synergies, to be achieved by the end of 2026, and the one-time costs to generate these synergies are expected to be approximately $700 million ³⁶, incurred primarily from 2025 through 2027.

Pfizer's manufacturing facility in Rocky Mount, North Carolina was damaged by a tornado in July 2023, but supply of medicines has recovered from the impact of the tornado. The company does not anticipate the availability of raw materials to have a significant impact on its operations in 2026, but is monitoring potential supply chain disruptions as a result of ongoing geopolitical and trade negotiations. Pfizer is continuing to monitor and implement mitigation strategies to reduce any potential risk or impact including active supplier management, qualification of additional suppliers and advanced purchasing to the extent possible. As of December 31, 2025, Pfizer employed approximately 75,000 ³⁷ people worldwide.

Pfizer's capital allocation framework is designed to enhance long-term shareholder value and is based on three core pillars: maintaining and, over the long term, growing its dividend, reinvesting in the business, and the potential to make share repurchases after de-levering its balance sheet. Over time, the company expects to continue to de-lever in a prudent manner in order to maintain a balanced capital allocation strategy. In 2026, Pfizer expects to spend approximately $2.5 billion ³⁸ on property, plant and equipment. As of December 31, 2025, Pfizer's remaining share-purchase authorization was $3.3 billion ³⁹ with no repurchases in 2025. On December 12, 2025, the Board of Directors declared a first-quarter dividend of $0.43 ⁴⁰ per share, payable on March 6, 2026, to shareholders of record at the close of business on January 23, 2026, which will be the 349th ⁴¹ consecutive quarterly dividend.

The IRA made significant changes to the Medicare Part D benefit design (IRA Medicare Part D Redesign), which took effect beginning in 2025 and negatively impacted Pfizer's 2025 revenues by approximately $1 billion ⁴². Pfizer does not expect a material, incremental impact from the IRA Medicare Part D Redesign in 2026 versus the baseline set in 2025. The drug pricing provisions of the IRA continue to be implemented, with CMS having selected Eliquis for the Medicare Drug Price Negotiation Program with a Maximum Fair Price effective January 1, 2026, and having selected Ibrance and Xtandi for Maximum Fair Price effective in 2027 and Xeljanz for Maximum Fair Price effective in 2028. The IRA also imposes rebates under Medicare Part B and Medicare Part D on drug price increases that outpace inflation.

Pfizer faces risks related to the global trade environment and potential trade conflicts, sanctions and impediments that could impact its business, including the risk and impact of tariffs on its business, which is subject to a number of factors including restrictions on trade, the effective date and duration of such tariffs, countries included in the scope of tariffs, changes to amounts of tariffs, and potential retaliatory tariffs or other retaliatory actions imposed by other countries. The September 2025 agreement with the Trump Administration provides a three-year grace period during which time Pfizer products will not face Section 232 tariffs, provided the Company further invests in manufacturing in the U.S., but Pfizer faces risks and uncertainties associated with the agreement and negotiating the binding final agreement, including the possibility of unfavorable terms and increased costs related to tariffs and investment requirements. The company is continuing to evaluate opportunities and developing plans which are intended to help mitigate the potential long-term impact of tariffs on its business and operations.

Pfizer anticipates a significant reduction of revenue from patent-based or regulatory exclusivity expiries in 2026 through 2030 as several of its in-line products experience these expirations, with the rate of the reduction of revenues from patent-based or regulatory exclusivity expiries expected to significantly accelerate over the next few years. In China, Pfizer expects to continue to face intensified competition by certain generic manufacturers in 2026 and beyond, which has and may continue to result in price cuts and volume loss of some of its products. The company also faces risks related to the evolving vaccine landscape, including changing regulatory requirements, changes in legislation, policy, liability landscape or other administrative actions, changes, delays or failure to receive recommendations, reimbursement, regulatory approvals and coverage for its vaccines, and in January 2026, the CDC unilaterally reduced the number of immunizations routinely recommended for all children in the U.S.

Pfizer faces significant risks from the loss, expiration or invalidation of intellectual property rights, with the company anticipating a significant reduction of revenue from patent-based or regulatory exclusivity expiries in 2026 through 2030, with the rate of reduction expected to significantly accelerate over the next few years and the impact in 2026 alone expected to be $1.5 billion ⁴³. The company is subject to extensive pricing and reimbursement pressures, including from the IRA Medicare Part D Redesign which negatively impacted 2025 revenues by approximately $1 billion ⁴⁴, and the Medicare Drug Price Negotiation Program which has selected Eliquis, Ibrance, Xtandi, and Xeljanz for government-set Maximum Fair Prices effective in 2026, 2027, and 2028 respectively. Pfizer faces risks related to its significant concentration of revenues, with 12 ⁴⁵ products collectively accounting for 65% ⁴⁶ of Total revenues in 2025 and Eliquis alone accounting for 13% ⁴⁷, and the company's recent business development initiatives have been concentrated in extremely competitive therapeutic areas such as obesity and oncology. The company also faces risks related to its global operations, including currency and interest rate fluctuations, global trade tensions, and tariffs, with 41% ⁴⁸ of total revenues derived from international operations in 2025, and the company's voluntary agreement with the Trump Administration to avoid Section 232 tariffs is subject to risks and uncertainties including the possibility of unfavorable terms and increased costs.

Management's message emphasizes Pfizer's purpose of 'Breakthroughs that change patients' lives' and outlines four key priorities for 2026: maximize value of key transactions, deliver on critical R&D milestones, invest to maximize post-2028 growth, and scale AI across the business. The company views business development activity as an enabler of its strategies and seeks to generate growth by pursuing opportunities and transactions that have the potential to strengthen the business and its capabilities, while also focusing on advancing its own product pipeline and maximizing the value of existing products. Management notes that the company is scaling AI across R&D, manufacturing, commercial and patient engagement to improve productivity and accelerate innovation, and that one way the company believes it will be more efficient, effective and able to execute on its strategic priorities is through digital enablement, including expanding automation, data-driven decision making, and enterprise AI solutions that strengthen productivity and accelerate innovation.