Pfizer cuts outlook after modifying supply deal for COVID products with U.S.; shares fall
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Shares of Pfizer (NYSE:PFE) fell in extended trading on Friday after the company cut its full-year revenue and earnings outlook due to lower than expected sales for its COVID products as a result of a supply deal amendment with the U.S. government.
The company said it now expects its FY23 revenues to be in the range of $58B to $61B, as compared to its previous outlook range of $67B to $70B.
The drugmaker cut its full-year 2023 adjusted diluted EPS to be in the range of $1.45â$1.65, as compared to its original outlook of $3.25â$3.45.
The Seeking Alpha consensus estimate for FY2023 revenue is $66.36B, and EPS is $3.30.
Shares fell as much as 6.6% to $30 after hours.
Under the amended agreement, the company will accept a non-cash return of the remaining EUA-labeled U.S. government inventory, which is estimated to be 7.9M treatment courses, and will record a $5.5B non-cash charge in Q3 primarily for COVID inventory write-offs.
As a result, annual revenue for Paxlovid has now been reduced by $7B and Comirnaty revenue by about $2B, Pfizer said.
The company also plans to implement a savings program, which will deliver ~$1B in savings in 2023 and up to $2.5B in 2024.
Pfizer said it will take a one-time cash charge of $3B, related to severance, among other things, to implement the savings program. 
Separately, the U.S. Department of Health and Human Services said it will, along with PFE, begin preparations for PFE to transition Paxlovid to the commercial market in November 2023.
During the transition to commercial distribution, Paxlovid will remain available for ordering from the U.S. Department of Health and Human Services through Dec. 15.
Shares of peer Moderna (MRNA) are also down 4.43% at $93.9 in extended trading.



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