Pharma Giants Face Earnings Pressure Amid Patent Cliff Fears

Pfizer and Merck are set to report their quarterly earnings amidst declining estimates. Pfizer is expected to report Q2 EPS of $0.68, a 12.8% year-over-year decline, with revenues projected to drop nearly 2% to $14.39 billion.

Merck anticipates a significant EPS decline to -$0.26, although revenue is expected to rise 3.5% to $16.37 billion. However, the looming Keytruda patent cliff poses a risk that necessitates new product launches to offset potential losses.

Pfizer's revenue from new launches and business development grew 22% in Q1 to $3 billion, demonstrating strong performance in its non-COVID portfolio, which is expected to support future earnings.