Prosper Junior Bakiny, The Motley Fool

Sun, Jun 1, 2025, 6:15 AM5 min read

• While it no longer generates the sales it once did, Pfizer's coronavirus lineup remains critical to its results.

• However, recent regulatory changes in the U.S. should make this franchise somewhat less lucrative.

• Even so, Pfizer's hopes of a comeback lie elsewhere, especially in its improving oncology unit.

• 10 stocks we like better than Pfizer ›

The past three years have been challenging for Pfizer (NYSE: PFE). Revenue and earnings have moved in the wrong direction, as has the company's share price. The stock is down by 56% since 2022. Although Pfizer has made some efforts to turn things around, they have been insufficient. And recent regulatory developments in the U.S. somewhat complicate things for the drugmaker.

Here's what investors need to know.

Pfizer's poor performance since 2022 is largely due to its coronavirus portfolio. After producing record revenue thanks to its work in this area, once the pandemic started receding, sales from Comirnaty, its COVID-19 vaccine, and Paxlovid, its therapy for the disease, started dropping off a cliff. However, Pfizer's coronavirus franchise has remained critical to its overall financial results. In 2024, the company's combined revenue from Paxlovid and Comirnaty was $11.1 billion.

Pfizer's total top line came in at $63.6 billion, increasing 7% compared to the year-ago period. When excluding contributions from its coronavirus products, Pfizer's revenue grew more quickly -- by 12% year over year. The company's sales were down compared to 2023 but still accounted for about 17.5% of its top line. That's a meaningful amount. Pfizer would be in a lot more trouble without Paxlovid and Comirnaty.

Here's the problem: Recent regulatory changes in the U.S. will make it more challenging for Pfizer to consistently generate solid revenue from Comirnaty. The U.S. Food and Drug Administration (FDA) has decided that instead of recommending COVID-19 vaccines for healthy adults and children above a certain age, it will do so only for seniors aged 65 and older and those with certain medical conditions that put them at risk of severe disease outcomes. The agency is requiring additional clinical trials before it can recommend annual booster shots for healthy adults.

Healthy children and pregnant women are also no longer on the list of those who should take the vaccine. These changes will take effect in the fall, peak vaccination season for COVID-19. In other words, the U.S. coronavirus vaccine market just became smaller. What does this mean for investors?