Pfizer CEO says R&D is the 'lifeblood that fuels us' as spending revs up post-COVID

In the pandemic's third year, Pfizer could do whatever it wanted thanks to billions reaped from the COVID-19 shot Comirnaty and antiviral Paxlovid. Instead, executives are signaling a somewhat restrained approach, cutting rare disease assets, seeking external partnerships and bumping up the R&D budget by 8.7% for 2023. 

“R&D continues to be the lifeblood that fuels us as a company," CEO Albert Bourla, Ph.D., said on a fourth-quarter earnings call Tuesday. The increase in R&D spend will mean around $12.4 billion to $13.4 billion will go toward developing new meds. That will help as Pfizer forecasts revenues from the COVID-19 franchise to plunge significantly in 2023. 

But on the same day, Pfizer also announced that eight rare disease assets will be cut, including a midphase rheumatoid arthritis candidate and a trio of phase 2 cancer programs. This follows an announcement earlier in the month that the Big Pharma is rethinking its rare disease strategy and exploring “externalization opportunities for a number of highly innovative, niche programs."   

Chief Scientific Officer Mikael Dolsten, M.D., Ph.D., gave more context on the strategy shift during the investor call, saying that the rare disease work will move from a standalone research unit and align key programs with other therapeutics areas. 

“We plan to externally advance rare disease programs that do not fit into a core therapeutic area of focus. At the same time, we plan to tap into the expanding external innovation ecosystem by actively pursuing biotech innovation and emerging innovation that fits strategically and accessing external assets that are differentiated," said Dolsten, who also serves as president of global R&D and medical.

Pfizer believes these efforts will help position the pharma to reach more patients with the most impactful near-term blockbuster breakthroughs while driving the next wave of innovation, according to Dolsten.

While upping R&D dollars, Pfizer is also working to increase overall return on investment and R&D productivity, Bourla said.

“As you’ve seen in the last year, we continuously prioritize our pipeline to focus on the assets that represent potential breakthroughs and have the potential for generating higher returns—putting more capital behind larger opportunities like GLP-1, flu, elranatamab and others,” the Pfizer CEO explained. “We are at an inflection point to act from a position of strength with our best-in-class R&D productivity, a robust pipeline of innovative assets and one of the highest R&D budgets in the industry.”

According to Bourla, the company's most promising pipeline assets include: an oral GLP-1 candidate for diabetes and obesity; potential combo vaccines for flu, COVID-19 and RSV; potential shots for Lyme disease and shingles; candidates targeting endocrine receptor-positive breast cancer; gene therapy candidates for hemophilia A, hemophilia B and Duchenne muscular dystrophy; and a pan-hemophilia A & B antibody treatment.

Dolsten said the company will continue to remain thoughtful about how it prioritizes R&D programs, pointing to the company’s outlicensing deal with Roivant for anti-TL1A antibody RVT-3101, which is currently being assessed in ulcerative colitis.

“From time to time, you're going to see programs like TL1A that have very clear scientific merit, but sharing the cost or risk and capabilities with a partner is the best way to create value,” Dolsten said. “And that's what we did in that situation. And we've had a long history of doing that in a number of other situations as well.”