Pfizer (NYSE: PFE) traders obtained some very dangerous information when the corporate was compelled to desert its internally developed GLP-1 weight reduction drug in April, 2025. With patent expirations on the horizon, falling even additional behind opponents like Novo Nordisk (NYSE: NVO) and Eli Lilly (NYSE: LLY) in an rising new drug area of interest was a foul look. However, what occurred subsequent is what’s actually essential.
GLP-1 drugs have seen sturdy shopper demand. Eli Lilly’s industry-leading GLP-1 medication Mounjaro and Zepbound, for instance, noticed income progress of 99% and 175%, respectively, in 2025. The flameout of Pfizer’s internally generated GLP-1 candidate was a significant setback.
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In reality, Pfizer hasn’t precisely been hitting out of the park for some time. Its COVID vaccine success is nicely previously, and it has notable patent expirations developing over the subsequent couple of years. The inventory is down round 50% from its 2021 highs. That stated, Pfizer did not hand over on the GLP-1 area of interest. It shortly shifted gears, shopping for an organization with a promising GLP-1 candidate. The deal closed in November, 2025, lower than a yr after Pfizer introduced its personal weight reduction drug had been dropped. That’s a fairly fast pivot.
What’s fascinating right here is that, regardless of an enormous decline in worth, Pfizer nonetheless has a market cap of $150 billion. It is a well-respected {industry} big navigating the conventional ebbs and flows of the pharmaceutical industry. Innovation is important, but it surely does not are available in a easy line. And, generally, an organization’s plans do not work out in addition to hoped.
It is what occurs in the course of the exhausting occasions that defines a drug firm. In February 2026, lower than a yr after its personal drug was dropped, Pfizer introduced that the long-acting GLP-1 drug it’s now engaged on was progressing as hoped. That’s the signal that Pfizer hasn’t all of the sudden misplaced its means. It remains to be the industry-leading drugmaker it was again when COVID vaccines had been driving the inventory larger.
Pfizer’s dividend yield is a lofty 6.2%, largely as a result of its payout ratio is over 100%. Conservative dividend traders could need to tread with warning. However, administration has said its intention to keep up the dividend. All in, if you happen to assume in a long time, this out-of-favor drug inventory remains to be an {industry} chief. It may simply assist set you up for life and, doubtless, for a lifetime of dividends.
