HQ Team
October 16, 2023: Germany’s BioNTech announced its partner Pfizer Inc.’s write-offs for inventory and other charges related to the Covid-19 Comirnaty vaccine may impact 2023 revenue of up to $900 million.
This “represents BioNTech’s half under the gross profit-sharing agreement with Pfizer,” according to a BioNTech statement. The company’s Q3 earnings are slated on November 6.
“Any such write-offs will reduce the revenues the company would report for 2023.”
BioNTech has been informed by Pfizer that the majority of the write-offs relate to raw materials, mainly formulation-related lipids, purchased during the pandemic, as well as Covid-19 vaccine doses adapted to other, non-XBB.1.5 variants produced at risk.
“According to Pfizer, the write-offs do not address the Pfizer-BioNTech Covid-19 Vaccine adapted to the XBB.1.5 variant, which has been approved and is being marketed in key geographies.”
Pfizer cuts revenue guidance
A year ago Pfizer and BioNTech’s Comirnaty vaccine and Pfizer’s own Paxlovid vaccine clocked revenue of more than $56 billion.
As vaccine sales plummeted globally, manufacturers have shifted focus either focusing on the variants or combining them with flu or influenza.
On October 13, Pfizer cut its full-year revenue forecast by 13% and announced it would cut $3.5 billion worth of jobs and expenses due to lower-than-expected sales of its Covid-19 vaccine and treatment.
The drugmaker expects 2023 revenue of between $58 billion and $61 billion, down from its earlier forecast of between $67 billion and $70 billion. It said the reduction was mainly due to lowered expectations for its COVID-19 products.
Supply and demand
“We remain proud that our scientific breakthroughs played a significant role in getting the global health crisis under control,” said Albert Boura, the CEO of Pfizer.
“As we gain additional clarity around vaccination and treatment rates for COVID, we will be better able to estimate the appropriate level of supply to meet demand.”
According to a Pfizer statement, the New York-based company would take a non-cash charge of $5.5 billion in the third quarter to write off $4.6 billion of Paxlovid and $900 million of inventory write-offs and “other charges for the vaccine.”
By 2024 the cost-cutting plan is expected to result in savings of about $3.5 billion.
