Pfizer announces new cost-cutting plan | Wilnesh News

Pfizer said on Wednesday it had launched new products multi-year plan Reduce costs and work to recover from the rapid decline in business due to the COVID-19 pandemic.

Pfizer announced another $4 billion cost-cutting plan last year as demand for its Covid vaccine and oral drug Paxlovid fell.

exist Securities filingThe pharmaceutical giant said the first phase of its new plan focuses on operational efficiencies and is expected to save the company approximately $1.5 billion by the end of 2027.

One-time costs associated with the first phase of layoffs are expected to be approximately $1.7 billion, including severance pay for an unknown number of laid-off employees. The company expects to record most of those charges this year.

Pfizer also expects the plan will involve “portfolio enhancements” and changes to the company’s manufacturing and supply network, a spokesperson told CNBC.

“The plan will focus on streamlining the way we work, reducing the complexity of Pfizer’s global supply and improving productivity,” a spokesperson said in a statement.

Pfizer added in the filing that “given the complexity of manufacturing and the long lead times required to make changes, this plan will be a multi-phase effort.”

Pfizer is trying to boost investor sentiment after its shares fell nearly 50% in 2023, making it the worst-performing pharmaceutical stock last year. The share price drop wiped more than $100 billion off Pfizer’s market value.

Pfizer’s new RSV vaccine underwhelmed last year as demand for its coronavirus products plummeted, with the twice-daily weight-loss drug failing to meet standards in clinical trials and falling short of initial 2024 forecasts. It also disappointed Wall Street.

But Pfizer pleased investors earlier this month report First-quarter revenue and adjusted profit beat expectations, and it raised its full-year profit forecast. The pharmaceutical giant said the new profit guidance reflected its “confidence” in its business and its ability to cut costs.

“We are cautiously optimistic about this year,” Pfizer Chief Executive Albert Bourla said on a May 1 earnings call.

The company’s shares closed up 6% that day. Since then, Pfizer’s shares have risen nearly 14%.