Pfizer punched back against activist investor Starboard Value on Tuesday, delivering positive quarterly results.
The pharmaceutical company raised its revenue outlook for the year to between $61 billion to $64 billion, up from $59.5 billion to $62.5 billion previously. It also raised its guidance on adjusted annual earnings per share to a range of $2.75 to $2.95 per share, up from between $2.45 to $2.65 per share.
The encouraging third quarter comes as Pfizer faces pressure from activist investor Starboard, who says poor investments in research and dealmaking have helped destroy billions of dollars in market capitalization. The latest earnings highlight Pfizer’s third consecutive quarter with positive results—a bright spot that could bolster the drugmaker, and Chief Executive Albert Bourla’s efforts to revamp the company.
Pfizer also beat Wall Street’s expectations on quarterly sales and earnings. The company reported sales totaling $17.7 billion, driven by its antiviral drug Paxlovid and cancer medicines, up from $14.9 billion forecast by analysts. Pfizer also reported adjusted earnings per share of $1.06, beating analyst estimates of 61 cents per share, according to FactSet.
Shares rose 0.6% in premarket trading Tuesday.
Pfizer generated record profits after it introduced its Covid-19 vaccine, which powered the company’s stock to a record high in 2021. But since then, shares have lost about half their value, weighed down by Pfizer’s inability to shake off a post-pandemic slump.
Leading the charge against Pfizer’s underperformance has been Starboard CEO Jeff Smith, whose fund holds a $1 billion stake in the company. The CEO said last week that Pfizer’s board should be laser-focused on tracking its return on research and development investments and holding management accountable. Smith added that the cause of Pfizer’s issues are the low expected returns on its R&D investments, including those done both internally and through deals.
The activist campaign has been an unusual one. To aid in its efforts Starboard approached former Pfizer CEO Ian Read and former Chief Financial Officer Frank D’Amelio, and each expressed interest in helping.
The men, however, later issued a statement saying they wouldn’t assist Starboard and were supporting Bourla. Starboard accused the company of pressuring them with lawsuits and other measures, and to back Bourla.
Pfizer’s CEO has sought to rejuvenate the beleaguered company with a number of changes over the past year, including multibillion-dollar cost-cutting programs and a reorganization, as well as a $43 billion acquisition of cancer drugmaker Seagen.
Following the acquisition of Seagen, Bourla set up a separate oncology research unit in a bet to generate billions in new sales. Pfizer expects Seagen drugs, known as antibody drug conjugates, to generate $10 billion in annual sales by 2030.
Quarterly sales from Seagen’s approved medicines totaled $854 million, marking the third straight quarter of sales growth for the products since Pfizer closed the deal.
Pfizer also saw growth in other oncology drugs, with sales rising 30% to more than $4 billion. That includes prostate cancer treatment Xtandi, whose sales increased 28% from a year ago to $561 million.
Vyndaqel, approved to treat a rare heart disease, sold $1.4 billion, up 62% from a year ago.
Joseph Walker contributed to this article.
Write to Jared S. Hopkins at jared.hopkins@wsj.com