Pfizer Inc. reported solid earnings for 2020 and said it expects even bigger things this year as the company projects approximately $15 billion in earnings from the COVID-19 vaccine it co-developed with Biontech SE.
Other companies, such as Moderna Inc. and Eli Lilly and Co., have also seen increases to their bottom lines thanks to COVID-19 product sales, with seed money from the U.S. government’s Operation Warp Speed, and they could see even higher numbers if they pursue developing vaccines and therapies against the virus’ variants. For some, it may become a durable product, producing revenues as long as the pandemic stretches out.
For this year, Pfizer said it believes it could earn a potential $61.4 billion, compared to its 2020 revenues of $41.9 billion. The vaccine, BNT-162b2, contributed $154 million in sales for Pfizer in the fourth quarter of 2020. Based on those numbers, the company raised its earnings per share guidance from $3 each to $3.10.
Based on what the company has seen since the pandemic began a year ago, Albert Bourla, Pfizer’s chairman and CEO, said he believes it is increasingly likely a durable COVID-19 vaccine revenue stream is a potential outcome for a couple of reasons.
“First, there likely will be a need to boost regularly to maintain high levels of vaccine-elicited immune response. Second, and maybe more important, we may need to boost to counter the threat of the emerging mutant strains we have seen with variations in the spike receptor-binding domain side,” he said.
COVID-19 will remain a sales focal point at Pfizer for the next few months, according to Mizuho Securities analyst Vamil Divan.
“We also tend to agree with Pfizer's commentary on an increased likelihood of a longer-tail of COVID-19 vaccine sales given various mutant strains and the possibility of needing to provide booster doses,” Divan added in the Feb. 3 note. “Our outer-year COVID-19 vaccine forecast now assumes sales of $800 [million to] $850 [million] annually.”
SVB Leerink analyst Geoffrey Porges labeled the COVID-19 revenues a “windfall” and its accompanying vaccine development as “an ongoing business, with post-pandemic margin potentially increasing to the more typical level of traditional pharma products if indeed their vaccine remains necessary, effective and differentiated.”
Operation Warp Speed had signed upward of $14 billion in contracts through early December, with Pfizer and Moderna contracting for 100 million doses in deals worth $1.95 billion and $1.5 billion. Those amounts doubled for each company when an additional 100 million doses were purchased from each in December.
Moderna, like Pfizer, is focused on chasing the variant mutations and is on a similar durable sales model as Pfizer. On Jan. 25, the company said it will test whether a adding a third dose of vaccine increases neutralizing antibodies against emerging variants. It plans to start preclinical and phase I studies of a version of its vaccine, mRNA-1273, specifically designed to be effective against the South African variant B 1.351.
Moderna is also discussing adding an additional 100 million doses of its mRNA vaccine for delivery to the U.S. government in the third quarter of 2021. As of Jan. 26, the company had supplied more than 30 million doses to the government and plans on delivering 200 million doses by the end of June.
Eli Lilly and Co.’s bamlanivimab (LY-CoV555), its COVID-19 antibody therapy, brought in worldwide revenue of $871.2 million in the fourth quarter of 2020. Lilly cut its initial agreement in October with Operation Warp Speed to supply 300,000 vials of bamlanivimab 700 mg for $375 million. The initial agreement is for delivery over the two months following an EUA and also provides the option for the U.S. government to purchase up to an additional 650,000 vials through June 30.
In October, Gilead Sciences Inc. said it expects its core business to continue gradually recovering in the fourth quarter 2020 and into the first half of 2021. That was the same month the FDA approved Veklury (remdesivir) for treating COVID-19 requiring hospitalization in adult and pediatric patients 12 and older. In its third quarter 2020 financial results, the company said product sales, excluding Veklury, increased 2% to $5.6 billion. Veklury revenues were $873 million for the third quarter 2020.
Veklury revenue is generated, the company added, “in a highly dynamic and complex global health environment, which continues to evolve.” Gilead plans to release its full 2020 numbers Feb. 4.