Segment, Geographic and Other Revenue Information

3 Months Ended

Apr. 02, 2023

Segment Reporting [Abstract]

Segment, Geographic and Other Revenue Information

Segment, Geographic and Other Revenue Information

A. Segment Information

We manage our commercial operations through two operating segments, each led by a single manager: Biopharma and Business Innovation, an operating segment established in the first quarter of 2023 that includes PC1, our contract development and manufacturing organization and a leading supplier of specialty active pharmaceutical ingredients, and Pfizer Ignite, a recently launched offering that provides strategic guidance and end-to-end R&D services to select innovative biotech companies that align with Pfizer’s R&D focus areas. Biopharma is the only reportable segment. Each operating segment has responsibility for its commercial activities. Regional commercial organizations market, distribute and sell our products and are

supported by global platform functions that are responsible for the research, development, manufacturing and supply of our products and global corporate enabling functions. Biopharma receives its R&D services from WRDM and GPD. These services include IPR&D projects for new investigational products and additional indications for in-line products. Each operating segment has a geographic footprint across developed and emerging markets. Our chief operating decision maker uses the revenues and earnings of the operating segments, among other factors, for performance evaluation and resource allocation.

Other Business Activities and Reconciling Items––Other business activities include the operating results of Business Innovation as well as certain pre-tax costs not allocated to our operating segment results, such as costs associated with: (i) R&D and medical expenses managed by our WRDM organization and costs associated with our GPD organization; (ii) corporate enabling functions and other corporate costs; (iii) overhead costs primarily associated with our manufacturing operations; and (iv) our share of earnings from Haleon/the Consumer Healthcare JV. Reconciling items include the following items, transactions and events that are not allocated to our operating segments: (i) all amortization of intangible assets; (ii) acquisition-related items; and (iii) certain significant items, representing substantive and/or unusual, and in some cases recurring, items that are evaluated on an individual basis by management and that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.

Segment Assets––We manage our assets on a total company basis, not by operating segment, as our operating assets are shared or commingled. Therefore, our chief operating decision maker does not regularly review any asset information by operating segment and, accordingly, we do not report asset information by operating segment. Total assets were $196 billion as of April 2, 2023 and $197 billion as of December 31, 2022.

Selected Income Statement Information

The following provides selected income statement information by reportable segment:
	Three Months Ended
	Revenues				Earnings(a)
(MILLIONS)	April 2, 2023		April 3, 2022		April 2, 2023		April 3, 2022
Reportable Segment:
Biopharma	$	17,971	$	25,323	$	10,936	$	13,391
Other business activities(b)	310		338		(2,734)		(2,429)
Reconciling Items:
Amortization of intangible assets					(1,103)		(835)
Acquisition-related items					(163)		(187)
Certain significant items(c)					(665)		(891)
	$	18,282	$	25,661	$	6,270	$	9,050

(a)Income from continuing operations before provision/(benefit) for taxes on income. Biopharma’s earnings include dividend income from our investment in ViiV of $92 million in the first quarter of 2023 and $56 million in the first quarter of 2022. In connection with the organizational changes effective in the third quarter of 2022, certain functions transferred between Biopharma and corporate enabling functions and certain activities were realigned within the GPD organization. We have reclassified $47 million of costs in the first quarter of 2022 from corporate enabling functions, which are included in Other business activities, to Biopharma to conform to the current period presentation.

(b)Other business activities include revenues and costs associated with Business Innovation and costs that we do not allocate to our operating segments, per above, including acquired IPR&D expenses in the periods presented.

(c)Certain significant items are substantive and/or unusual, and in some cases recurring, items (as noted above). Earnings in the first quarter of 2023 and 2022 include, among other items, net losses on equity securities of $452 million and $698 million, respectively, recorded in Other (income)/deductions––net. See Note 4.

B. Geographic Information

The following summarizes revenues by geographic area:
	Three Months Ended
(MILLIONS)	April 2, 2023		April 3, 2022		% Change
United States	$	8,507	$	8,918	(5)
Developed Europe	2,822		6,090		(54)
Developed Rest of World	2,473		3,286		(25)
Emerging Markets	4,480		7,367		(39)
Revenues	$	18,282	$	25,661	(29)

C. Other Revenue Information

Significant Customers––For information on our significant wholesale customers, see Note 17C in our 2022 Form 10-K. Additionally, revenues from the U.S. government represented 15% and 19% of total revenues for the three months ended April 2, 2023 and April 3, 2022, respectively. Accounts receivable from the U.S. government represented 17% and 4% of total trade accounts receivable as of April 2, 2023 and December 31, 2022, respectively. Revenues and accounts receivable from the U.S. government primarily represent sales of Paxlovid and Comirnaty.

Significant Product Revenues

The following provides detailed revenue information for several of our major products:

(MILLIONS)		Three Months Ended
PRODUCT	PRIMARY INDICATION OR CLASS	April 2, 2023		April 3, 2022
TOTAL REVENUES		$	18,282	$	25,661
GLOBAL BIOPHARMACEUTICALS BUSINESS (BIOPHARMA)(a)		$	17,971	$	25,323
Primary Care		$	11,505	$	18,851
Paxlovid	COVID-19 in certain high-risk patients	4,069		1,470
Comirnaty direct sales and alliance revenues(b)	Active immunization to prevent COVID-19	3,064		13,227
Eliquis alliance revenues and direct sales	Nonvalvular atrial fibrillation, deep vein thrombosis, pulmonary embolism	1,874		1,793
Prevnar family	Active immunization to prevent pneumonia, invasive disease and otitis media caused by Streptococcus pneumoniae	1,593		1,565
Nurtec ODT/Vydura	Acute treatment of migraine and prevention of episodic migraine	167		1
Premarin family	Symptoms of menopause	112		102
BMP2	Development of bone and cartilage	86		67
FSME-IMMUN/TicoVac	Active immunization to prevent tick-borne encephalitis disease	45		42
Nimenrix	Active immunization against invasive meningococcal ACWY disease	40		77
All other Primary Care	Various	456		507
Specialty Care		$	3,612	$	3,505
Vyndaqel family	ATTR-CM and polyneuropathy	686		612
Sulperazon	Bacterial infections	320		210
Xeljanz	RA, PsA, UC, active polyarticular course juvenile idiopathic arthritis, ankylosing spondylitis	237		372
Enbrel (Outside the U.S. and Canada)	RA, juvenile idiopathic arthritis, PsA, plaque psoriasis, pediatric plaque psoriasis, ankylosing spondylitis and nonradiographic axial spondyloarthritis	199		280
Inflectra	Crohn’s disease, pediatric Crohn’s disease, UC, pediatric UC, RA in combination with methotrexate, ankylosing spondylitis, PsA and plaque psoriasis	178		135
Zithromax	Bacterial infections	150		125
Genotropin	Replacement of human growth hormone	147		80
Ig Portfolio(c)	Various	126		107
Zavicefta	Bacterial infections	116		104
BeneFIX	Hemophilia B	109		112
Medrol	Anti-inflammatory glucocorticoid	93		76
Oxbryta	Sickle cell disease	71		—
Somavert	Acromegaly	66		68
Refacto AF/Xyntha	Hemophilia A	60		66
Fragmin	Treatment/prevention of venous thromboembolism	58		70
Vfend	Fungal infections	51		65
All other Anti-infectives	Various	374		381
All other Specialty Care	Various	569		643
Oncology		$	2,855	$	2,967
Ibrance	HR-positive/HER2-negative metastatic breast cancer	1,144		1,237
Inlyta	Advanced RCC	259		234
Xtandi alliance revenues	mCRPC, nmCRPC, mCSPC	258		268
Bosulif	Philadelphia chromosome–positive chronic myelogenous leukemia	150		128
Zirabev	Treatment of mCRC; unresectable, locally advanced, recurrent or metastatic NSCLC; recurrent glioblastoma; metastatic RCC; and persistent, recurrent or metastatic cervical cancer	129		147
Ruxience	Non-hodgkin’s lymphoma, chronic lymphocytic leukemia, granulomatosis with polyangiitis (Wegener’s Granulomatosis) and microscopic polyangiitis	114		124
Lorbrena	ALK-positive metastatic NSCLC	112		72
Xalkori	ALK-positive and Proto-Oncogene 1, Receptor Tyrosine Kinase-positive advanced NSCLC	111		127

(MILLIONS)		Three Months Ended
PRODUCT	PRIMARY INDICATION OR CLASS	April 2, 2023		April 3, 2022
Retacrit	Anemia	93		115
Bavencio alliance revenues	Locally advanced or metastatic urothelial carcinoma; metastatic Merkel cell carcinoma; immunotherapy and tyrosine kinase inhibitor combination for patients with advanced RCC	85		67
Aromasin	Post-menopausal early and advanced breast cancer	77		62
Besponsa	Relapsed or refractory B-cell acute lymphoblastic leukemia	58		51
Sutent	Advanced and/or metastatic RCC, adjuvant RCC, refractory gastrointestinal stromal tumors (after disease progression on, or intolerance to, imatinib mesylate) and advanced pancreatic neuroendocrine tumor	50		114
Braftovi	In combination with Mektovi for metastatic melanoma in patients with a BRAFV600E/K mutation and, in combination with Erbitux® (cetuximab)(d), for the treatment of BRAFV600E -mutant mCRC after prior therapy	49		48
Mektovi	In combination with Braftovi for metastatic melanoma in patients with a BRAFV600E/K mutation	40		40
Trazimera	HER2-positive breast cancer and metastatic stomach cancers	34		52
All other Oncology	Various	92		81
BUSINESS INNOVATION(a)		$	310	$	338
Pfizer CentreOne(e)	Various	306		338
Pfizer Ignite	Various	4		—
Total Alliance revenues included above		$	2,060	$	2,314

(a)See Note 1A in our 2022 Form 10-K for information about our recent organizational changes within Biopharma. See Note 13A above for information about Business Innovation. Prior-period financial information has been revised to reflect the current period presentation.

(b)Excludes revenues for certain Comirnaty-related manufacturing activities performed on behalf of BioNTech, which are included in the PC1 contract development and manufacturing organization. See footnote (e) below.

(c)Immunoglobulin (Ig) portfolio includes the revenues from Panzyga, Octagam and Cutaquig.

(d)Erbitux® is a registered trademark of ImClone LLC.

(e)PC1 includes revenues from our contract manufacturing, including certain Comirnaty-related manufacturing activities performed on behalf of BioNTech ($5 million and $47 million for the first quarters of 2023 and 2022, respectively), and revenues from our active pharmaceutical ingredient sales operation, as well as revenues related to our manufacturing and supply agreements with former legacy Pfizer businesses/partnerships.

Remaining Performance Obligations––Contracted revenue expected to be recognized from remaining performance obligations for firm orders in long-term contracts to supply Comirnaty to our customers totaled approximately $13 billion as of April 2, 2023, which includes amounts received in advance and deferred, as well as amounts that will be invoiced as we deliver these products to our customers in future periods. Of this amount, current contract terms provide for expected delivery of product with contracted revenue in 2023 and 2024, the timing and terms of which may be renegotiated. Remaining performance obligations are based on foreign exchange rates as of the end of our fiscal first quarter of 2023 and exclude arrangements with an original expected contract duration of less than one year.

Deferred Revenues––Our deferred revenues primarily relate to advance payments received or receivable from various government or government sponsored customers in international markets for supply of Comirnaty. The deferred revenues related to Comirnaty total $1.7 billion as of April 2, 2023, with $1.6 billion and $34 million recorded in current and noncurrent liabilities, respectively. The deferred revenues related to Comirnaty totaled $2.5 billion as of December 31, 2022, with $2.4 billion and $77 million recorded in current liabilities and noncurrent liabilities, respectively. The decrease in Comirnaty deferred revenues during the first three months of 2023 was primarily the result of amounts recognized in Revenues as we delivered the products to our customers, partially offset by additional advance payments received as we entered into amended contracts and the impact of foreign exchange. During the first quarter of 2023, we recognized revenue of approximately $1.7 billion that was included in the balance of Comirnaty deferred revenues as of December 31, 2022. The Comirnaty deferred revenues as of April 2, 2023 will be recognized in Revenues proportionately as we transfer control of the product to our customers and satisfy our performance obligation under the contracts, with the amounts included in current liabilities expected to be recognized in Revenues within the next 12 months, and the amounts included in noncurrent liabilities expected to be recognized in Revenues in 2024. Deferred revenues associated with contracts for other products were not significant as of April 2, 2023 or December 31, 2022.