Pharma giant Pfizer (PFE -1.18%) gained in prominence in the past couple of years thanks to its COVID-19 vaccine, Comirnaty. The company has generated billions in sales from this product alone, although many investors now think this tailwind will soon end, as the demand for coronavirus vaccines could drop substantially starting next year.

However, Pfizer has several tricks up its sleeve. The company is currently working on another promising vaccine that may not become nearly as successful as Comirnaty, but could generate at least $1 billion in annual sales if approved. Let's look into this program and what it could mean for Pfizer.

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A new candidate for an old disease

On Sept. 14, Pfizer announced that it had started a phase 3 clinical trial for a potential mRNA-based influenza vaccine. The study will enroll 25,000 healthy adults in the U.S. Flu vaccines have been around for a while, and thousands of people are already inoculated every year. Current options do confer some degree of protection, but they're limited.

Preparing vaccines for the flu season is a long process. That's because researchers first have to identify the strains that are the most likely to be circulating during each season. Once that's done, it takes months to manufacture the vaccines. By the time the flu season comes along, it's entirely possible that the vaccines in circulation won't be a perfect match for the strains in circulation.

That's why flu vaccines only tend to be 40% to 60% effective, and sometimes even less. Meanwhile, the flu continues to be a serious health concern. It causes tens of thousands of hospitalizations and deaths every year. That's especially the case with those aged 65 and older, who are disproportionately represented among patients who suffer severe cases. In other words, despite the wide availability of vaccines against influenza, there's still a dire need.

Pfizer is aiming to develop a vaccine that would be an improvement over the current ones. As the company argues, mRNA technology could help deal with the strain-matching problem, since vaccines of this kind are much faster to manufacture. It could grant researchers more time to figure out which strains are more likely to arise during the flu season, and they could do so closer to the actual start of the dreaded period when influenza is most likely to be transmitted. Better strain-matching could lead to more effective vaccines against the flu and fewer hospitalizations and deaths.

Beware of the competition

Besides the fact that Pfizer's candidate could fail to prove effective in this late-stage study, it's worth noting that the company faces competition. Other companies have also highlighted the need to develop newer, more effective vaccines against the flu and are taking the mRNA approach. One of them is Moderna (MRNA -6.86%).

Moderna started a phase 3 study for its mRNA-based influenza vaccine, mRNA-1010, in June. The biotech does also have a few other candidates that target the flu that are still in the early stages of development. Those include mRNA-1073, a potential combined influenza and COVID-19 vaccine.

Moderna started its pivotal study for mRNA flu vaccines about three months before Pfizer's. But that's not what matters the most: Some of the biotechs that seemed to be in the lead in the race to develop a COVID-19 vaccine ended up losing the race. Inovio Pharmaceuticals is an excellent example.

Ultimately, the safety and efficacy of Pfizer's and Moderna's candidates will determine whether they can make a dent in the flu vaccine market -- which, according to some estimates, will be worth $12.3 billion by 2028, recording a compound annual growth rate of 7.4% through then.

Pfizer's shares look attractive

It's too early to tell whether Pfizer's flu vaccines can help the company achieve its goals. Thankfully, there are other excellent reasons to invest in the pharma giant. Pfizer has generated tens of billions thanks to Comirnaty, which will allow it to expand its lineup, in part via acquisitions. That should help Pfizer set up a solid foundation for long-term growth.

Furthermore, the company currently trades at a reasonable valuation. Pfizer's forward price-to-earnings ratio is currently an attractive 7.1, compared to the pharmaceutical industry's average of 12.5. Flu vaccine or not, Pfizer looks like an excellent stock to buy and hold.