The number of people suffering from Covid might be on the rise, but vaccine providers are not doing as well as expected.

America pharmaceutical group Pfizer (PFE:NYSE) sent a chill across the healthcare sector on 13 October after slashing full year revenue guidance by 13% and announcing $3.5 billion of cost cuts to counter falling sales of its Covid-19 vaccine.

Pfizer also slashed its earnings per share guidance to a new range of between $1.45 to $1.65 from $3.25 to $3.45.

The news had a negative knock-on effect for other Covid-19 vaccine makers – Moderna’s (MDNA:NASDAQ) share price fell around 4% and AstraZeneca (AZN) dropped 1%. US-listed shares of German vaccine maker BioNTech (BNTX:NASDAQ) fell 5%.

Pfizer shares have lost 38% of their value so far in 2023 and now trade close to their pre-pandemic levels. The drug maker expects to generate revenues of between $58 billion to $61 billion this year reflecting a $7 billion cut to its Covid-19 antiviral Paxlovid sales and a $2 billion cut to sales of the Comirnaty Covid vaccine co-developed with BioNTech. Consequently, the German partner said it would incur a $900 million write-off in its third quarter representing half of its gross profit-sharing agreement with Pfizer.

In response to Pfizer’s revenue warning Moderna put out a statement reaffirming its forecast of between $6 billion and $8 billion in Covid-19 vaccine sales for the year.

Pfizer’s warning comes amid the Autumn roll-out of its Covid booster with reports suggesting it has seen a slower than expected take-up due to delays in insurance coverage.

Chief executive Albert Bourla told investors on 16 October the company expected around 17% of the US population to get booster shots, in line with 2022.

Pfizer said a ‘cost realignment programme’ should save it $1 billion in 2023 and $2.5 billion in 2024 and would entail severance and implementation costs.

The company plans to move sales of Paxlovid into a commercially marketed arrangement from November 2023 and sell to privately insured patients. Patients on government sponsored insurance schemes and those uninsured will continue to receive Paxlovid free of charge until the end of 2024.

On a more positive note, Danish diabetes and leading weight-loss treatment company Novo Nordisk (NVO:NYSE) seems to be going from strength to strength. It increased 2023 sales and profit guidance on 13 October after seeing a better-than-expected performance in the US for weight-loss treatments Wegovy and Ozempic.

Novo Nordisk now expects profit before interest and tax to grow between 40% and 46% from a previous range of 31% to 37% while it forecasts sales to grow between 32% to 38% from earlier guidance of 27% to 33%, reflecting strong demand. The shares gained 5% on the news to reach a new record high and are up 79% over the past year.

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