Potential 10% Upside To Pfizer’s Price Estimate

+3.20%
Upside
27.72
Market
28.61
Trefis
PFE: Pfizer logo
PFE
Pfizer

Our estimate for Pfizer (NYSE:PFE) is dependent on the success of its phase 3 pipeline. Here, we consider an extreme scenario in which all phase 3 drugs are approved within next 3 years. It could imply 10% upside to our price estimate.

Phase 3 pipeline fires

Pfizer’s Oncology Drugs Revenue, Neuroscience Drugs Revenue and Cardiovascular Drugs Revenue: Pfizer’s pipeline is reasonably strong. The phase 3 oncology pipeline has 3 drugs with combined peak sales estimate of $6 billion. Overall, the the company has 10 drugs in phase 3 which can bring in combined peak sales of $12.5 billion. Our valuation reflects probability adjusted revenues, assuming 50% probability of phase 3 drugs reaching commercial launch stage. However, if all phase 3 drugs are approved within the next 3 years, it could imply 10% upside to our price estimate.

Oncology phase 3 drugs

  • Avelumab: It is being co-developed with Merck, Germany. The drug is being tested across seven tumor types and could be filed for FDA approval by 2017. We believe it could generate nearly $2 billion in peak sales.
  • Dacomitinib: This is a pan-HER inhibitor and a small molecule drug, and is being tested for advanced non-small cell lung cancer. It could be filed for FDA approval by 2019 and could generate estimated peak sales of $1 billion.
  • Inotuzumab Ozogamicin: The drug was filed for FDA approval in June, 2016 and received breakthrough therapy designation in 2015. It is aimed at treating acute lymphoblastic leukemia, which can be only treated through long term chemotherapy. If approved, it could generate peak sales of $3 billion.
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Cardiovascular phase 3 drugs

  • Bococizumab: The drug is expected to be filed for FDA approval in 2019. It has already shown successful results in reducing cholesterol levels significantly. The company is testing it for the treatment of Hyperlipidemia and reducing the risk of heart attacks. If approved, it would be competing with similar drugs from Amgen, Sanofi and Regeneron, which have struggled to gain traction. If successful, the drug could generate peak sales of $2 billion.
  • Rivipansel: This drug is aimed at treating patients suffering from sickle cell anemia who are hospitalized for vaso-occlusive crisis. This is a rare condition and we expect the pricing to be high. The drug is expected to be filed for FDA approval by 2018, and has potential of generating $1 billion in peak sales.

Neuroscience phase 3 drugs

  • ALO-02 Oxycodone-naltrexone core: It is a small molecule drug and is currently under FDA review. If approved, it could be launched by the end of 2016 or early 2017 for the treatment of severe pain, and can generate $1 billion in peak sales.
  • Tafamidis Meglumine : The drug is being tested for the treatment of a rare diseases known as Adult Symptomatic Transthyretin Cardiomyopathy. It could be filed for FDA approval by 2017 and has a potential to generate peak sales of $0.5 billion.

Alimentary and Musculoskeletal phase 3 drugs:

  • There are three drugs in this category including MOD-4023, Ertugliflozin and Tanezumab. These could be filed for FDA approval by 2018. If approved, they could generate peak sales of $2.2 billion.

Have more questions about Pfizer? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Pfizer

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