We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Pfizer Overcome Its COVID and Patent Cliff Headwinds?
Read MoreHide Full Article
Key Takeaways
Pfizer expects its LOE cliff to reduce revenues by approximately $1.1 billion in 2026.
Pfizer's 2026 revenue guidance of $60.5-$62.5 billion signals mostly flat to slightly negative growth.
New products, acquisitions and pipeline investments are expected to drive a return to growth from 2029.
Pfizer (PFE - Free Report) faces a number of structural headwinds, ranging from patent expirations and declining COVID-19 revenues to pricing pressure, intense competition and the need to replenish its pipeline.
PFE’s LOE Headwinds
One of Pfizer’s biggest challenges is the approaching loss of exclusivity (LOE) for several important products. Pfizer expects a significant negative impact on revenues from the LOE cliff in the 2026-2030 period as several of its key products, including Eliquis, Ibrance, Xeljanz and Xtandi, face patent expirations. The LOE cliff is expected to hurt sales by approximately $1.1 billion in 2026.
PFE’s COVID Business Faces Continued Revenue Declines
During the pandemic, Pfizer generated extraordinary COVID-related sales from Comirnaty and Paxlovid. Sales of Comirnaty and Paxlovid have fallen substantially from pandemic levels, turning these products from major growth drivers into sources of revenue volatility.
Although the company has been able to stabilize the business, COVID-related sales remain considerably below their pandemic peaks. This means Pfizer must increasingly rely on its non-COVID portfolio to drive growth.
Pfizer’s 2026 Guidance Points to Sluggish Growth
Pfizer’s revenue guidance for 2026 indicates mostly flat to slightly negative year-over-year growth.
The company expects total revenues for 2026 to be between $60.5 billion and $62.5 billion. The range represents a slight decline from 2025 revenues of $62.6 billion due to lower revenues from Comirnaty and Paxlovid and loss of revenues from the patent cliff.
In 2026, Pfizer expects adjusted earnings per share in the range of $2.80-$3.00, which represents a decline from the 2025 EPS of $3.22 due to the dilutive impact of 3SBio and Metsera deals, lower COVID revenues and higher taxes.
Pfizer Banks on New Products & Buyouts to Return to Growth
Pfizer is taking a multi-pronged approach to offset the decline in COVID-19 revenues and the impact of upcoming patent expirations. The company is focusing on strengthening its non-COVID portfolio, accelerating new product launches and investing in its pipeline to build replacement growth ahead of the patent cliff.
The company is also using acquisitions and licensing deals to supplement internal innovation, including investments in obesity programs from Metsera and oncology assets such as the PD-1 x VEGF bispecific licensed from 3SBio.
Pfizer’s recently launched and acquired products recorded continued double-digit growth in both the first and second quarters of 2026. Its non-COVID revenues also rose in a mid-single-digit range, on an operational basis, in both quarters of 2026.
Although Pfizer’s 2026 sales guidance indicates minimal growth, the company expects a high single-digit revenue CAGR for five years, starting from year-end 2028. Pfizer expects its recently launched and acquired products, along with a strong pipeline, to help it return to growth from 2029 onward.
Competition in the Oncology Space
Pfizer is one of the largest drugmakers of cancer medicines. Other large players in the oncology space are J&J (JNJ - Free Report) , AstraZeneca (AZN - Free Report) , Merck (MRK - Free Report) and Bristol-Myers.
Oncology accounts for nearly 29% of J&J’s total revenues. In the first half of 2026, oncology revenues increased 16.9% to $14.4 billion on an operational basis, fueled by continued momentum for Darzalex and Erleada, although weaker demand for Imbruvica partially offset these gains. J&J’s new cancer drugs, Carvykti, Tecvayli, Talvey and Rybrevant/Lazcluze are contributing significantly to top-line growth driven by market share gains.
For AstraZeneca, oncology sales now comprise around 46% of total revenues. Sales in its oncology segment rose 15% at constant exchange rate to $14.1 billion in the first half of 2026. AstraZeneca’s strong oncology performance was driven by medicines such as Tagrisso, Lynparza, Imfinzi, Calquence and Enhertu (in partnership with Daiichi Sankyo).
Merck’s key oncology medicines are the PD-L1 inhibitor Keytruda and the PARP inhibitor Lynparza, which it markets in partnership with AstraZeneca. Keytruda, approved for several types of cancer, alone accounts for more than 55% of the company’s pharmaceutical sales. Keytruda recorded sales of $15.8 billion in the first half of 2026, up 4% year over year.
PFE’s Price Performance, Valuation and Estimates
Pfizer stock has risen 11.3% so far this year compared with an increase of 9.8% for the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, Pfizer appears attractive relative to the industry. Going by the price/earnings ratio, Pfizer’s shares currently trade at 9.40 forward earnings, significantly lower than 17.86 for the industry. However, the stock is trading slightly above its five-year mean of 9.25.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings per share has risen from $2.96 to $2.98, while that for 2027 has risen from $2.86 to $2.94 over the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
Can Pfizer Overcome Its COVID and Patent Cliff Headwinds?
Key Takeaways
Pfizer (PFE - Free Report) faces a number of structural headwinds, ranging from patent expirations and declining COVID-19 revenues to pricing pressure, intense competition and the need to replenish its pipeline.
PFE’s LOE Headwinds
One of Pfizer’s biggest challenges is the approaching loss of exclusivity (LOE) for several important products. Pfizer expects a significant negative impact on revenues from the LOE cliff in the 2026-2030 period as several of its key products, including Eliquis, Ibrance, Xeljanz and Xtandi, face patent expirations. The LOE cliff is expected to hurt sales by approximately $1.1 billion in 2026.
PFE’s COVID Business Faces Continued Revenue Declines
During the pandemic, Pfizer generated extraordinary COVID-related sales from Comirnaty and Paxlovid. Sales of Comirnaty and Paxlovid have fallen substantially from pandemic levels, turning these products from major growth drivers into sources of revenue volatility.
Although the company has been able to stabilize the business, COVID-related sales remain considerably below their pandemic peaks. This means Pfizer must increasingly rely on its non-COVID portfolio to drive growth.
Pfizer’s 2026 Guidance Points to Sluggish Growth
Pfizer’s revenue guidance for 2026 indicates mostly flat to slightly negative year-over-year growth.
The company expects total revenues for 2026 to be between $60.5 billion and $62.5 billion. The range represents a slight decline from 2025 revenues of $62.6 billion due to lower revenues from Comirnaty and Paxlovid and loss of revenues from the patent cliff.
In 2026, Pfizer expects adjusted earnings per share in the range of $2.80-$3.00, which represents a decline from the 2025 EPS of $3.22 due to the dilutive impact of 3SBio and Metsera deals, lower COVID revenues and higher taxes.
Pfizer Banks on New Products & Buyouts to Return to Growth
Pfizer is taking a multi-pronged approach to offset the decline in COVID-19 revenues and the impact of upcoming patent expirations. The company is focusing on strengthening its non-COVID portfolio, accelerating new product launches and investing in its pipeline to build replacement growth ahead of the patent cliff.
The company is also using acquisitions and licensing deals to supplement internal innovation, including investments in obesity programs from Metsera and oncology assets such as the PD-1 x VEGF bispecific licensed from 3SBio.
Pfizer’s recently launched and acquired products recorded continued double-digit growth in both the first and second quarters of 2026. Its non-COVID revenues also rose in a mid-single-digit range, on an operational basis, in both quarters of 2026.
Although Pfizer’s 2026 sales guidance indicates minimal growth, the company expects a high single-digit revenue CAGR for five years, starting from year-end 2028. Pfizer expects its recently launched and acquired products, along with a strong pipeline, to help it return to growth from 2029 onward.
Competition in the Oncology Space
Pfizer is one of the largest drugmakers of cancer medicines. Other large players in the oncology space are J&J (JNJ - Free Report) , AstraZeneca (AZN - Free Report) , Merck (MRK - Free Report) and Bristol-Myers.
Oncology accounts for nearly 29% of J&J’s total revenues. In the first half of 2026, oncology revenues increased 16.9% to $14.4 billion on an operational basis, fueled by continued momentum for Darzalex and Erleada, although weaker demand for Imbruvica partially offset these gains. J&J’s new cancer drugs, Carvykti, Tecvayli, Talvey and Rybrevant/Lazcluze are contributing significantly to top-line growth driven by market share gains.
For AstraZeneca, oncology sales now comprise around 46% of total revenues. Sales in its oncology segment rose 15% at constant exchange rate to $14.1 billion in the first half of 2026. AstraZeneca’s strong oncology performance was driven by medicines such as Tagrisso, Lynparza, Imfinzi, Calquence and Enhertu (in partnership with Daiichi Sankyo).
Merck’s key oncology medicines are the PD-L1 inhibitor Keytruda and the PARP inhibitor Lynparza, which it markets in partnership with AstraZeneca. Keytruda, approved for several types of cancer, alone accounts for more than 55% of the company’s pharmaceutical sales. Keytruda recorded sales of $15.8 billion in the first half of 2026, up 4% year over year.
PFE’s Price Performance, Valuation and Estimates
Pfizer stock has risen 11.3% so far this year compared with an increase of 9.8% for the industry.
From a valuation standpoint, Pfizer appears attractive relative to the industry. Going by the price/earnings ratio, Pfizer’s shares currently trade at 9.40 forward earnings, significantly lower than 17.86 for the industry. However, the stock is trading slightly above its five-year mean of 9.25.
The Zacks Consensus Estimate for 2026 earnings per share has risen from $2.96 to $2.98, while that for 2027 has risen from $2.86 to $2.94 over the past 60 days.
Pfizer has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.