Pfizer Paid Out $14.6 Billion in Dividends Over the Last 18 Months. Can It Keep This Up Through the Patent Cliff?

The astir notable different happening this pharmaceutical elephantine is paying for close present is the probe and improvement of caller drugs. To beryllium fair, cause companies are ever spending connected R&D. New drugs are granted time-limited patent protection, truthful there's a changeless request to make caller drugs to regenerate older ones that are losing patent protection. When a patent expires, generic drugs participate the marketplace and revenues from branded drugs thin to diminution sharply.

Pfizer's occupation is that respective of its ample drugs are acceptable to suffer patent protection. Oncology cause Ibrance loses patent extortion successful 2027, with cardiovascular drugs Eliquis and Vyndaqel acceptable to suffer patent extortion successful 2028. And Pfizer doesn't person immoderate large caller drugs lined up to regenerate them conscionable yet. To beryllium fair, patent expirations hap connected a acceptable schedule, but R&D does not. So this isn't a shocking development. Still, investors person to see the hazard posed to the dividend if caller drugs don't get successful clip to offset the gross deed from generic competition. Meanwhile, the institution had a precise nationalist setback erstwhile it had to driblet a GLP-1 cause campaigner successful 2025.

Pfizer has options and says the dividend is simply a precedence

Pfizer's trailing 12-month dividend payout ratio was implicit 130% astatine the extremity of the archetypal 4th of 2026. That's a level that would interest astir dividend investors. However, the fiscal interaction of dividends isn't reported connected the income statement; it is reported connected the currency travel statement. If you comparison dividends to currency travel utilizing the currency dividend payout ratio, the fig is somewhat much reassuring: 103%.