(Bloomberg) -- After a miserable 2023, Pfizer Inc. Chief Executive Officer Albert Bourla says he’s rapidly taking action to fix things and pegging the company’s hopes on one of the most competitive areas of pharma for growth: cancer.

Since the end of 2022, Pfizer’s shares have fallen 42% as the company has repeatedly stumbled with the rapid decline of its Covid business. While investors chafe, the firm is looking to the recent acquisition of Seagen Inc. and its targeted cancer drugs to help restore Pfizer’s leadership position in the industry.

“Clearly, 2023 was not a good year for us,” Bourla said to an overflow crowd during a fireside chat at the JPMorgan Healthcare Conference in San Francisco. “We used to be the stars of the industry for a few years, so that drop really hurts.”

Bourla looked prescient as Pfizer led the way in the development of the leading Covid vaccine and therapy, Paxlovid. Now the CEO has come under fire after the drug giant cut its 2023 sales guidance twice and its outlook for this year missed Wall Street’s expectations. The company also disappointed investors by touting a weight-loss pill that fell short in clinical trials, leading to some Wall Street skepticism. 

“Our confidence is not the highest” in Pfizer’s management, Cowen & Co. managing director Steven Scala wrote when he downgraded the company to market perform last week. “We don’t have much conviction in the outlook, making it tough to pound the table even from these levels.”

Pfizer’s low share price is “an anomaly right now that the market will fix,” Bourla said Monday in an interview. He added that Pfizer would focus on growing its dividend in 2024 and said further big deals were unlikely this year. The company’s stock was little changed on Tuesday as US markets opened. 

The CEO acknowledged missteps that led to the guidance cuts in Covid sales and an underwhelming introduction of a new RSV vaccine for older adults. While Pfizer is unlikely to top its success of the Covid years when its vaccine became one of the drug industry’s best-selling products in a single year, it might be able repeat its success in another area. 

With the $43 billion purchase of Seagen, Pfizer gained access to antibody drug conjugates, therapies that precisely target tumors with powerful chemotherapy while leaving surrounding tissues relatively unscathed. They’re among the industry’s most sought-after products: AbbVie Inc. agreed to acquire ImmunoGen Inc. for $10.1 billion to enter the field, while Merck & Co. is paying as much as $22 billion for the rights to sell three experimental ADCs from Daiichi Sankyo Co.

Seagen’s expertise will give the company a big advantage in cancer treatments, and now that the deal is done, “we have all the elements” to develop ADCs further, he said.    

Multiple Threats

Yet Pfizer faces challenges on multiple fronts. Its vaccines are facing competitive threats, as Moderna Inc. said Monday that its market share for Covid shots is increasing. Meanwhile, GSK Plc is ahead in terms of market share for its RSV shot for adults, and Merck & Co. is expected to be introducing a new vaccine this year that could encroach on the pneumococcal vaccine Prevnar, which is one of Pfizer’s top earners. 

Bourla acknowledged problems in launching the RSV shot but said the company would be better prepared to compete in the next vaccination season. Sales of the vaccine were $375 million in the third quarter, its first full three months on the market.

Another big question mark for the company is its entry into the market for weight-loss pills that’s projected to reach as much as $100 billion a year by the end of the decade. Last year at this conference, Bourla was touting obesity pills as the next big thing for the company, saying Pfizer’s obesity medicines might capture $10 billion in annual sales. 

But trials of the company’s obesity pills didn’t go well in 2023. While Pfizer is still very interested in the obesity market, “clearly, that projection is challenged,” Bourla said in the interview.

(Recasts story, adds Tuesday’s stock trading in sixth paragraph and RSV vaccine sales in penultimate paragraph.)

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