(Bloomberg) — Pfizer Inc. raised its profit forecast for the year, with the drugmaker’s ongoing cost cuts helping to make up for a lack of expected sales growth.
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The company’s stock rose as much as 5.4% in New York Tuesday as investors look for good news after a decline in demand for the company’s Covid products forced the drugmaker to reshape its business.
Adjusted profits will be between $2.90 to $3.10 per share in 2025, the New York-based company said in a statement, an increase of 10 cents per share over its prior projection. The company maintained its sales expectations of $61 billion to $64 billion, the midpoint of which would represent a decline in sales from 2024.
“It’s marginally positive,” Mizuho analyst Jared Holz said. “And with the pharmaceutical industry the toughest it’s been in a long time, that’s good enough.”
Pfizer is in the process of rebuilding in the aftermath of the pandemic, slashing about $7.2 billion from its spending and betting on an unproven pipeline of new medicines to make up for the stagnant sales of its aging products.
Adding to the pressure on Pfizer, the entire pharmaceutical industry faces the threat of sector-specific tariffs and policies that would restrict what they can charge for medicines in the US. As Pfizer was reporting its second-quarter earnings on Tuesday, President Donald Trump said in a television interview pharma tariffs would be announced “within the next week or so.”
On Thursday, Trump also sent letters to 17 of the largest drugmakers, demanding they slash the price of medicines for US customers. Pfizer Chief Executive Albert Bourla was one of the executives to have received a personal letter from the president.
Pfizer has held “productive discussions” with Trump and his administration since then, Bourla said on a conference call with analysts Tuesday, adding he has spoken up for industry priorities including reining in pharmaceutical middlemen and making changes to a Joe Biden-era law that allows the government to negotiate certain drug prices.
Bourla declined to provide further details but noted he and Trump have “a special relationship from the times of Covid,” when Pfizer worked with the administration to develop its vaccine.
“There is no scenario that we have not assessed,” Bourla said of potential tariffs and pricing restrictions. “There is no scenario that we have not built mitigation plans for.”