Pfizer Faces $1 Billion IRA Reform Hit As Analysts Expect Flat 2025 Outlook

Zinger Key PointsPfizer expects $1 billion net IRA impact in 2025, with $1.5 billion in losses and $500 million in gains due to Medicare Part D changes.BofA holds Pfizer’s price target at $27, with 2025 EPS and sales projections largely unchanged from earlier forecasts.Get daily-updated rankings across momentum, growth, value, trends, and quality to spot the strongest stocks in any market.Bank of America (BofA) Securities updated the earnings model forPfizer Inc.PFE. The company will announce second-quarter 2025earnings on August 5.According to data fromBenzinga Pro, analysts estimate adjusted earnings of 57 cents per share on sales of $13.41 billion.In the second quarter, total revenue decreased by less than 1%, and earnings per share remained unchanged.Analysts also expect revenue and EPS to stay within 1% of previous forecasts. Revenue will likely decline by a low single-digit percentage in the latter part of the 2020s, they say. This is mainly due to Vyndaqel and Ibrance’s earlier-than-expected loss of exclusivity.Read Next:Pfizer, Sanofi Find Relief As Delaware Top Court Rejects Zantac Expert TestimonyEPS is also expected to shift up or down by a low single-digit percentage, depending on the year.BofA maintains theprice forecast of $27with a Neutral rating using a 9x P/E multiple on updated 2025 EPS.Pfizer’s stock is trading at a price-to-earnings ratio of about 8–9 times its expected 2025 earnings. That’s lower than the peer average of around 12 times, excludingEli Lilly & CoLLY.Trending Investment OpportunitiesAdvertisementArrivedBuy shares of homes and vacation rentals for as little as $100.Get StartedWiserAdvisorGet matched with a trusted, local financial advisor for free.Get StartedPoint.comTap into your home's equity to consolidate debt or fund a renovation.Get StartedRobinhoodMove your 401k to Robinhood and get a 3% match on deposits.Get StartedIt also offers a high dividend yield of around 7%, which may help prevent the share price from falling further. However, the long-term outlook is less certain due to upcoming patent expirations and increased competition, which could result in slower-than-average growth.Pfizer expects its 2025 sales to decline by about $1 billion due to changes under the Inflation Reduction Act (IRA) Part D reform. The company anticipates a $500 million increase in revenue from more patients using its drugs, thanks to lower out-of-pocket costs. However, this is offset by a $1.5 billion loss due to increased costs in the catastrophic phase of Medicare Part D.Cheaper options (i.e. Eliquis) may benefit from certain reforms more than expensive drugs because the coverage gap is being removed.In the first quarter of 2025, Pfizer says it already felt a negative impact of around $650 million compared to the same period in 2024, due to higher discount requirements for drugmakers.Price Action:PFE stock is down 0.64% at $25.49 at the last check on Monday.Loading...Loading...Read Next:Wolfspeed (WOLF) Stock Resumes Rally Amid Restructuring OptimismImage: ShutterstockPFEPfizer Inc$25.48-0.64%Stock Score Locked: Edge Members OnlyBenzinga Rankings give you vital metrics on any stock – anytime.Unlock RankingsEdge RankingsMomentum27.67Growth31.87Quality64.52Value30.79Price TrendShortMediumLongOverviewLLYEli Lilly and Co$795.020.25%Market News and Data brought to you by Benzinga APIs© 2025 Benzinga.com. . .EarningsAnalyst RatingsOptionsDividendsIPOsDate▲▼ticker▲▼name▲▼Actual EPS▲▼EPS Surprise▲▼Actual Rev▲▼Rev Surprise▲▼Click to see moreEarningsupdatesEarnings CalendarNever Miss Important CatalystsSort by estimates, projected upside, profit surprises, and more to easily find new stocks to invest in or check up on your portfolio.Click to JoinPosted In:Analyst ColorBiotechEarningsLarge CapNewsGuidanceHealth CareAnalyst RatingsGeneralBriefsExpert IdeasStories That Matter