A：Pfizer's second quarter 2026 earnings were marked by strong performance with revenues and adjusted diluted EPS exceeding expectations. The company highlighted the excellent performance of their commercial teams and their ability to operate with financial discipline. Additionally, significant progress was made in advancing their R&D pipeline with multiple opportunities for success across all four therapeutic areas.

A：The leadership team members available for the Q&A session include Albert Bourla, Chairman and CEO, Dave Denton, CFO, Cecile Gagan, incoming interim CFO, and Chris Boshoff, Chief Scientific Officer.

A：The nature of the transition mentioned is the partnership between Dave and Cecile Gagan to prepare for the role of interim CFO for Gagan, which is now taking place.

A：Key achievements highlighted in R&D and business development include strong execution across the business, strategic transactions for growth, solid revenue growth, and the addition of a platform and pipeline in oncology. The acquisition of Biohaven positioned the company as a leader in migraine treatment and provided further advancement opportunities. In terms of pipeline progress, critical milestones included regulatory approvals, data readouts, and study starts.

A：Pfizer is prioritizing investment in R&D for internal programs and selective business development with potential to strengthen key areas. Financial discipline and cost management are enabling continued investment in growth. The company expects an additional $1 billion in savings from ongoing realignment programs and net cost savings of $6.7 billion through 2029. They are also advancing the next phase of their manufacturing optimization program with further expected savings.

A：For the full year 2026, the company is raising the midpoint of its revenue guidance and reaffirming the guidance for adjusted diluted earnings per share. This reaffirmation and the revenue growth reflect the company's confidence in its business performance.

A：The speaker felt that leaving Pfizer was a difficult decision but deemed it the right personal choice.

A：The speaker introduces Cecile as the person to guide Pfizer's financial and growth strategy, highlighting her deep financial knowledge, expertise, and respect earned across the organization.

A：Key operational achievements include 18% operational revenue growth, continued pipeline growth, and a strong commercial performance that mitigated the impact of low Covid infections. The adjusted diluted EPS was 77 cents, exceeding expectations, and productivity initiatives and cost control measures were mentioned.

A：The updated forecast for the second quarter includes a raised midpoint of revenue guidance range despite lower-than-expected Covid revenues, reaffirmed adjusted diluted EPS guidance, and a delivery of revenue growth across key brands in the US and select international markets.

A：The company maintains leadership in oncology and vaccines and has successfully identified patients, supported access, and maintained the leadership position across these areas.

A：The company expects $700 million in savings from phase one of its manufacturing optimization program in 2026, with $175 million realized in Q2.

A：The company has made meaningful progress on its productivity enhancement initiative and remains on track to deliver most of the anticipated $7.2 billion in total net cost savings by the end of 2026.

A：The expansion of ongoing cost improvement programs is expected to generate approximately $2.5 billion in additional net cost savings from 2027 to 2029, with specific efforts to reduce S&A costs and deliver operational efficiency.

A：The strategy for the first half of 2026 includes reinvesting in the business, maintaining and over time growing the dividend, and preserving optionality for future value-enhancing actions. This involved investing $5.5 billion in internal and external R&D and returning $4.9 billion to shareholders via a quarterly dividend.

A：The reaffirmed guidance includes adjusted diluted EPS guidance of 2 dollars and 80 cents to 3 dollars.

A：Over the next several years, Pfizer aims for high single-digit revenue growth by the end of the decade, investing in business focus and discipline to support progress with their R&D pipeline and driving commercial impact with their products.

A：The recent phase three results for lifua showed significant improvements over placebo for facial and total body vitiligo area scoring index (BVI) at week 52.

A：The FDA expanded the approved indication of Pat C to include muscle and bladder cancer. This was based on phase 3 results showing a 35% reduction in the risk of death versus standard of care, establishing Pat C as a potential practice-changing medicine for more than 42,000 patients in the U.S.

A：The non-ss Mace non-ss quam lung cancer study met the primary overall survival endpoint. The subgroup of patients who received only one prior line of therapy showed a median survival benefit of 2.5 months.

A：The ongoing phase 1 dose escalation study of 4404 in combination with a checkpoint inhibitor showed encouraging response rates, with a safety profile that has remained consistent.

A：Metstrom stat, an Ezh2 inhibitor, is in phase 3 development for prostate cancer. The potential first in class internally discovered Ezh2 inhibitor aims to delay resistance toxtandi and is being developed with three pivotal studies underway.

A：Pembro has now expanded its use across the continuum from curative intent Mibc to metastatic disease, independent of the context or eligibility. Q2 saw strong growth, with over 20% increase attributed to effective commercial execution. A significant portion of prescriptions are in the new adjuvant setting, with the expectation that these patients will receive adjuvant treatment over time.

A：PSA is anticipated to be a major program for the future, with very accelerated growth already achieved. While the pace of growth will moderate as the majority of eligible patients and prescribers in Lam UC are reached, the intention is to continue driving this opportunity. The potential upside will come from mitc and will be sustained over time.

A：The bladder sparing study is significant as it aims to provide an alternative to a horrible operation for patients, if accepted. This study could offer a major deal for patients affected by the condition.

A：The Ezh 2 trial is fully enrolled and the necessary events for the study have not been reached yet. If successful, the commercial opportunity could span the entire disease continuum from post aarada own to early aligned settings, presenting a significant opportunity.

A：The ongoing phase 1, 2a study on amylin is focused on determining the optimal dose that's tolerable, safety, and clinical pharmacology, including PK. This informs the ongoing study, which is now in phase 2, comparing amylin to placebo for efficacy.

A：The ThermoCyc study aims to provide data on efficacy and tolerability. A phase 2 study is expected to read out in 2027 with a monthly differentiated approach. Early data shows that the combination is well-tolerated and efficacy is anticipated to be more than with Benno types alone. Efficacy data is expected later this year or early next year.

A：The plans for first line adjuvant trials involve focusing on two indications: first line, HER2 positive breast cancer and adjuvant settings. A phase 2 study for the adjuvant setting is anticipated to start by the end of 2026.

A：The proposal to cut 340B hospital payments could affect the oncology portfolio, but the specific impact is unclear as the details of the potential changes are still evolving. The company is actively communicating the issue to regulators and legislators and is awaiting further clarity on the topic.

A：A potential dividend cut would be considered if the company faces extremely constrained scenarios that make it difficult to maintain the dividend. However, the current dividend policy is to maintain it and to reinstate it after the current situation improves.

A：The Vitiligo program's Tranquilo 2 data showed clinically meaningful and statistical significance for both 50 and 100 mg doses, as stated in the press release. The official co-primary endpoint was shared for the 100 mg dose, while the full data set is expected to be presented later at a conference. The company has observed consistency between the two pivotal trials, although specific details from Tranquil 1 were not mentioned in the provided transcript.

A：New potential studies for Tregrebin in ad include trials against placebo and Dupixent, as well as programs in asthma and COPD. The strategic thinking is to leverage the molecule's tri-specific binding to Il 4, Il 13, and Tslp to potentially offer a differentiated approach in these conditions. The differentiation is highlighted by encouraging data from the phase 2 trial in atopic dermatitis and aims to start four phase 3 studies with specific design details not covered in the transcript.

A：The trial against Dupixent will be a head-to-head, superiority study powered for the first-line treatment in patients. It will be the first phase 3 trial to compare Tregrebin against Dupixent and will be designed to test for superiority. Regarding the PZM agreement, it is an update to a previous memorandum of understanding signed in the White House, and the final version is consistent with industry standards and those seen in other companies' agreements. The new agreement aims to lower drug costs and is effective from the second quarter of this year, although specific changes from earlier versions are not discussed in the transcript.

A：The long-term trajectory of the Covid franchise is expected to continue to be impacted by vaccine rates and the independent sales of vaccines from infection rates. While the vaccine business tends to be more stable and less affected by fluctuations in infection rates compared to drugs like Paxlovid, which is highly correlated with the seasonality of infection, it's noted that this year's low infection rates still allowed for a strong performance due to the rest of the business. The future of the franchise's growth is uncertain, but the strong performance of the remaining business this year has been crucial. Business development strategies are also being made to realize higher value in new technologies and new claims, as well as executing swiftly on material studies.

A：Business development at Pfizer is showing strong results with investments outpacing competitors since 2022. Of the investments made post-Covid, 80% have already been placed in three transactions, with all three performing very well. Pfizer is continuing to develop the pipeline to maximize value in new technologies and is advancing studies rapidly. Future plans include executing on business opportunities in areas where Pfizer can make a significant impact, such as oncology, immune inflammation, primary care with obesity, and vaccines. Investments are expected to drive high single-digit growth after the label expansion period, which is in 2024.