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MarketScreener Homepage  >  Equities  >  Nyse  >  Pfizer Inc.    PFE


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Pharma Giants Market Their Value as Pandemic Bolsters Reputation

11/09/2020 | 05:45am EST

By Alexandra Bruell

In April, as Covid-19 cases rose rapidly in the U.S., pharmaceutical company Pfizer Inc. repurposed some of the TV ad inventory it had previously reserved for product commercials to launch a corporate campaign called "Science Will Win."

"At a time when things are most uncertain, we turn to the most certain thing there is, Science," a narrator says during the TV ad. "Science can overcome diseases, create cures and yes, beat pandemics. It has before; it will again."

The pharmaceutical industry, long disparaged for some companies' association with the opioid crisis and high drug prices, is experiencing a reputation boost as the coronavirus pandemic highlights its role in developing medications and vaccines.

The shift is inspiring pharma giants, historically more used to hawking their products than their own names, to launch additional corporate branding efforts and rethink their marketing and communications.

Pharmaceutical companies increased spending on corporate ads to $180 million during the first half of this year from $167 million in the first six months of 2019, according to ad-tracking company Kantar. By contrast, spending on product ads decreased slightly to $2.9 billion in the first half of 2020 from $3 billion in the same period last year.

"It was a fight between pharma, tobacco companies and the government for who would be at the bottom in terms of reputation," said Kate Cronin, global chief executive of Ogilvy Health, an advertising agency that is part of ad holding company WPP PLC. Its clients include Pfizer, Merck & Co. and Bristol-Myers Squibb Co. "Covid is giving them an opportunity to step out of that world and into the world of 'we can help,' and it's giving pharma a comeback."

Pfizer's "Science Will Win" campaign was influenced by company research suggesting that people wanted to hear from scientists, versus celebrities or politicians, said Sally Susman, chief corporate affairs officer at Pfizer.

Pfizer has in recent months publicized its protocol for vaccine trials for the first time, collaborated with competitors on a broad campaign to boost public's confidence in vaccine safety protocols and increased the visibility of the company's CEO in the media, she said.

"I knew as a communications executive that I needed to operate differently, that themes like collaboration would become very important as opposed to competition," Ms. Susman said.

Pfizer was among the top U.S. spenders on corporate pharmaceutical ads in the first half of this year, increasing its spending to $12.2 million from $2.9 million in the first six months of 2019, according to Kantar.

The pharmaceutical industry's net favorability increased this year to 17% from 13%, according to research from data-intelligence company Morning Consult LLC. The company, which looked at 13 months of data ending in October, defines net favorability as the share of people with a favorable impression minus those with an unfavorable impression. Among consumers who have a bachelor's degree and earn more than $100,000 a year, net favorability of the pharmaceutical industry increased to 28% from 17% during the same period.

"I don't think an industry gets that many opportunities to reintroduce itself," said Pfizer's Ms. Susman. "The vaccine has really created a new conversation for the industry."

Industry trade group Pharmaceutical Research and Manufacturers of America has run ads during the pandemic to promote its members' role in fighting the coronavirus.

One digital ad shows a virus on one side and children holding pumpkins on the other. The idea is that science is what will lead to normal ways of life, said Priscilla VanderVeer, vice president of public affairs for PhRMA.

"This has given us a bit of an opportunity to tell the story about why we do what we do and why having a biopharma sector is so critical to public health both here in the U.S. but also around the world," said Ms. VanderVeer.

A Johnson & Johnson ad that aired earlier this year, dubbed "Behind the Mask," also promotes its scientists.

To be sure, the industry faces a complicated terrain, including a highly scrutinized and increasingly politicized coronavirus vaccine approval process. A number of potential vaccines are in development as cases soar in the U.S.

The Trump administration in an Aug. 27 letter asked states to speed up approval for vaccine distribution sites by Nov. 1, prompting concern from some public-health experts about possible political pressure to rush a vaccine before it is determined to be fully safe.

"The pharma industry is in a position where they have to maintain and build the trust of their stakeholders," said Ogilvy Health's Ms. Cronin. "They can't look like they're falling into a political battlefield."

Eight pharmaceutical companies, including Pfizer, AstraZeneca PLC, GlaxoSmithKline PLC and Johnson & Johnson, have pledged to uphold safety measures as they go through an expedited regulatory approval process for potential Covid-19 vaccines.

The sector's companies are also bolstering executives' presence in the media to explain their approach to producing drugs and vaccine trials, according to Ms. Cronin.

Ad holding companies hit hard by the pandemic's impact on their clients in many categories touted health care as one of the few bright spots in their third-quarter earnings reports. WPP's health-care revenue increased 2.1% in the quarter. Omnicom Group Inc. reported a 3.8% increase in organic revenue -- stripping out acquisitions and currency fluctuations -- in its health-care business. And at Publicis Groupe SA, health care in the U.S. posted a double-digit growth rate, the company said.

Some companies believe consumers' interest in vaccine development is becoming a lens for the way they see other drug marketing, executives said.

William Martino, chief growth officer for Wunderman Thompson Health, said more pharmaceutical companies are asking ad agencies how campaigns promoting specific products would affect their corporate brands.

Companies are asking, "What's your opinion on how this will be perceived in the marketplace," Mr. Martino said. "In the past it was, how do we sell molecules."

Write to Alexandra Bruell at alexandra.bruell@wsj.com

(END) Dow Jones Newswires

11-09-20 0544ET

Stocks mentioned in the article
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ASTRAZENECA PLC -1.00% 7645 Delayed Quote.4.38%
GLAXOSMITHKLINE PLC -2.17% 1379.8 Delayed Quote.2.82%
OMNICOM GROUP., INC. -0.36% 62.87 Delayed Quote.1.17%
PFIZER INC. -0.63% 36.5 Delayed Quote.-0.84%
PUBLICIS GROUPE SA 1.23% 43.54 Real-time Quote.6.82%
WPP PLC 2.66% 810.8 Delayed Quote.1.35%
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Financials (USD)
Sales 2020 48 425 M - -
Net income 2020 19 798 M - -
Net Debt 2020 43 571 M - -
P/E ratio 2020 11,8x
Yield 2020 3,95%
Capitalization 203 B 203 B -
EV / Sales 2020 5,09x
EV / Sales 2021 4,42x
Nbr of Employees 88 300
Free-Float 59,1%
Duration : Period :
Pfizer Inc. Technical Analysis Chart | MarketScreener
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Technical analysis trends PFIZER INC.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 22
Average target price 41,94 $
Last Close Price 36,50 $
Spread / Highest target 45,2%
Spread / Average Target 14,9%
Spread / Lowest Target -1,37%
EPS Revisions
Managers and Directors
Albert Bourla Chairman, Chief Executive & Operating Officer
Frank A. D'Amelio Chief Financial Officer & EVP-Business Operations
Lidia L. Fonseca Executive VP, Chief Digital & Technology Officer
Suzanne Nora Johnson Independent Director
Helen H. Hobbs Independent Director
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