💉 Is Pfizer Set To Boost Its Profits Further?

Six states differ on J&J settlement; Walmart's new launch.

Hey Global Investor! Here’s what you need to know before the US markets open.

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​💉 Pfizer: Boost Profits With A Booster?

Pfizer (PFE) is on a roll. The FDA granted full approval to its Covid-19 vaccine developed in collaboration with BioNTech. The US is looking to approve the Pfizer vaccine for a third booster shot imminently. And finally, it’s acquiring Trillium Therapeutics Inc. (TRIL) for $2.26B in cash. There’s no dearth of positive news, it seems! (Tweet This)

A Fist Full Of Dollars!

The US is at a crossroads. Its vaccination drive seems to have stalled. Daily Covid numbers are showing no signs of flattening. A large number of Americans are unwilling to get jabbed. What could turn the tables in such a conundrum?

A recent survey showed that three in 10 unvaccinated Americans would be inclined to get vaccinated if the vaccine itself gets full approval. Until yesterday, all vaccines were operating under an Emergency Use Authorization.

In what could be a shot in the arm for the vaccination drive, Pfizer’s vaccine received full approval from the FDA yesterday for age 16 years and above. Worldwide, this vaccine has been administered 204M times and often to a high level of effectiveness.

Hope springs eternal, and this approval may erase some degree of vaccine hesitancy within the population. This news couldn’t have come at a better time with the US grappling with a world-topping seven-day average of 130K cases.

There’s also talk of the FDA getting ready to approve the Pfizer/BioNTech vaccine for a third booster shot against the virus. This invariably will mean the cash registers will continue ringing indefinitely on the vaccine front.

Pfizer had already raised the price of its vaccine in the European Union to $23 per shot from the earlier $18.40. In its most recent quarterly update, Pfizer raised its 2021 sales forecast for the Covid-19 vaccine by 29% to $33.5B.

For A Few Dollars More!

With vaccines becoming a virtual cash cow, Pfizer continues to leverage this windfall to fortify the rest of its business with timely acquisitions. Yesterday, the company announced the acquisition of all remaining shares of Trillium Therapeutics in a deal valued at $2.3B. This completes a process that had started last September when Pfizer had acquired a token $25M stake in Trillium.

Based in Cambridge, Massachusetts, Trillium focuses on cancer immunotherapy. Its drugs under development are designed to enhance the ability of a patient’s immune system to detect and destroy cancer cells.

While several players are running after this Holy Grail, Pfizer believes Trillium’s molecules have an edge over the competition in terms of safety and efficacy.

Pfizer will pay $18.50 per share in cash for the remaining shares that it doesn’t own. That’s a premium of over 200% to Trillium’s closing price on Friday. The investment last fall was made at $10.88 per share.

Pfizer has been on the lookout to augment its cancer drug pipeline. Last month, it committed $1B in an alliance with Arvinas, a clinical-stage biopharmaceutical company, for developing and commercializing its lead drug for breast cancer.

Others are also on the prowl in this space. In March 2020, Gilead Sciences acquired cancer immunotherapy developer Forty Seven for $4.9B. Separately, AbbVie paid $200M to I-Mab to secure the rights to another promising molecule with at least $1.74B in payments to be made based on milestones achieved.

Pfizer is currently basking in the glory of its vaccine success. And it’s wisely channeling the earnings into opportunistically diversifying its broader portfolio. Shareholders are sitting pretty and happy to rake in the moolah!

Market Reaction
PFE ended at $49.93, up 2.48%.

Company Snapshot 📈

PFE $49.93 +1.21 (2.48%)

Analyst Ratings (21 Analysts) BUY 24%  HOLD 76%  SELL 0%

Newsworthy 📰

Differ: Six US states do not join $26B opioid settlements with distributors, J&J (JNJ -1.01%)

Last Mile: Walmart launches delivery business to connect other local retailers with customers (WMT -0.72%)

Fight: Lyft ‘extremely confident’ it will win legal fight to classify drivers as contractors (LYFT +2.94%)

Later Today 🕒

  • Medtronic Plc. Earnings (MDT)
  • Intuit Inc. Earnings (INTU)
  • Best Buy Co. Inc. Earnings (BBY)
  • Advance Auto Parts Inc. Earnings (AAP)
  • Toll Brothers Inc. Earnings (TOL)
  • 7:30 PM IST: New Home Sales

Fun Fact of The Day 🌞

Americans buying a Volvo can get a free holiday to Sweden to test drive their new car

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