The past few years have been a challenging ride for Pfizer (PFE 0.81%). Since the company made history in 2022, when it became the first in the biopharma industry to reach $100 billion in annual sales, it has been pretty much downhill. Although Pfizer has made some moves to turn things around, it still faces challenges heading into 2026 that could prove significant obstacles to its long-term prospects. Let's look into two of them and discuss what they mean for investors considering Pfizer stock.
1. Stricter COVID vaccine requirements
Pfizer achieved the $100 billion in annual sales milestone thanks to its work in the coronavirus market. The company's vaccine, Comirnaty, and medicine, Paxlovid, were both among the leaders in their niches. Comirnaty continues to generate meaningful sales for Pfizer. Through the first nine months of the year (ended Sept. 28), the vaccine generated $2.1 billion in revenue, representing a 6% increase over the comparable period of the previous fiscal year.
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Comirnaty's sales can be somewhat volatile due to seasonal patterns (people are more likely to get vaccinated during the fall and winter) and fluctuating demand for the product. However, recent regulatory changes in the U.S. will complicate matters for Pfizer. The U.S. Food and Drug Administration (FDA) has imposed stricter requirements for who is eligible for vaccines. The new guidance focuses on people who are at high risk of developing severe cases of the disease, a group that includes the immunocompromised and the elderly.
And then there is a recent report from an FDA official seeking to make the approval of updated vaccines (which scientists update annually to target virus strains most likely to be prevalent) more challenging. Under this new system, updated vaccines will have to meet a higher standard for safety and efficacy to be approved by the agency. Those changes could impact Pfizer's sales in this market. Through Sept. 30, Comirnaty made up 4.7% of the company's total revenue. That could decrease substantially next year.
2. Kicking off a wave of patent cliffs
One challenge for Pfizer's medium-term prospects is the looming patent cliffs. Over the next few years, starting in 2026, the company will lose patent exclusivity for several products. In some cases, it won't be that big a deal. For instance, Xeljanz, an immunosuppressant, is losing U.S. patent protection next year. However, the medicine hasn't been a significant growth driver in a while. Through the first nine months of 2025, Xeljanz's sales dropped by 7% year over year to $763 million.
NYSE: PFE
Key Data Points
Pfizer will also lose U.S. patent exclusivity for Prevnar 13, part of its Prevnar family of vaccines for pneumonia. Through Sept. 30, sales of this franchise dropped by 1% year over year to $4.8 billion. It's worth noting, however, that Xeljanz has not performed well partly due to competition (there are also some safety issues with the drug). Even if it is no longer a key growth driver, the introduction of cheaper generics will erode its sales even faster, leading to lower revenue for the company. Further, that will only be the first wave.
Pfizer will then face more significant patent cliffs in the subsequent years, including for Eliquis, its best-selling medicine, whose revenue is still trending in the right direction. Eliquis' sales through the first three quarters increased 7% year over year to $5.9 billion.
Can Pfizer overcome the challenges?
The good news is that Pfizer has revamped its pipeline and is entering a period during which it will likely make significant clinical and regulatory progress. The company has made progress with several new products over the past few years, some of which are expected to receive additional label expansions and contribute more to top-line growth. Pfizer's most exciting pipeline candidates, however, include PF-4404, a potential cancer medicine that aims to challenge the best-selling therapy in the vast oncology market: Keytruda.
PF-4404 might be Pfizer's most promising cancer program, but the company has a large pipeline in this area, which it expanded through acquisitions. We can also mention the company's new mid-stage weight management asset, its late-stage flu vaccine that successfully completed phase 3 clinical trials, and more. Pfizer may struggle to consistently and meaningfully grow revenue over the next few years, but it should eventually rebound. Lastly, the company offers an excellent dividend program with a forward yield of 6.7%. Pfizer's outlook remains strong for patient, long-term investors.
