Hold Rating on Pfizer Due to Tafamidis Patent Expiration Risks and Revenue Decline Concerns

Morgan Stanley analyst Terence Flynn maintained a Hold rating on Pfizer today and set a price target of $32.00.

Terence Flynn’s rating is based on several factors impacting Pfizer’s stock. One of the primary concerns is the impending patent expiration for Pfizer’s Tafamidis, marketed as Vyndamax and Vyndaqel, which is expected to lead to a significant revenue decline. The patent cliff, anticipated later in the decade, could result in approximately $20 billion in lost revenue, a situation that is well recognized by the market and reflected in Pfizer’s lower price-to-earnings ratio compared to the S&P 500 and historical industry averages.
Despite Tafamidis being a successful product with projected sales of $6.4 billion in 2025, the looming patent expirations in the US and EU pose a challenge. While there is potential for a patent term extension in the US, and the polymorph patent for Vyndamax could delay generic competition until 2035, the uncertainty surrounding these legal battles and their outcomes contributes to the Hold rating. Investors are advised to consider these factors, as the potential for revenue erosion starting in 2027 remains a significant risk.

According to TipRanks, Flynn is a 3-star analyst with an average return of 1.9% and a 49.83% success rate. Flynn covers the Healthcare sector, focusing on stocks such as BioNTech SE, Gilead Sciences, and Merck & Company.

In another report released on July 8, Bernstein also assigned a Hold rating to the stock with a $30.00 price target.