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Analyzing Pfizer’s Expense Projections for 2018

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Expense projections for 2018

In its third-quarter investor presentation, Pfizer (PFE) revised its 2018 adjusted SI&A (selling, informational, and administrative) expense guidance from the previously projected range of $14.0 billion–$15.0 billion to $14.0 billion–$14.5 billion.

The company expects its 2018 R&D (research and development) expenses to be in the range of $7.7 billion–$8.1 billion, while its effective tax rate is expected to be 16%.

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Wall Street analysts expect Pfizer to report adjusted SI&A expenses of $14.43 billion in 2018, a YoY (year-over-year) fall of 0.26%. The company is also expected to report adjusted SI&A expenses of $14.38 billion in 2019, a YoY fall of 0.37%. Analysts expect Pfizer’s 2020 adjusted SI&A expenses to be $14.32 billion, a YoY fall of 0.39%.

Wall Street analysts expect Pfizer to report adjusted R&D expenses of $7.84 billion in 2018, a YoY rise of 2.88%. The company is also expected to report adjusted R&D expenses of $8.0 billion in 2019, a YoY rise of 1.92%. Analysts also expect Pfizer’s 2020 adjusted R&D expenses to be $8.15 billion, a YoY rise of 1.92%.

Expense guidance for 2019

According to the company’s third-quarter earnings conference call, it expects interest expenses of $1.5 billion and interest income of $300 million in 2019. The company also expects pension credit and other expenses to amount to $500 million in 2019.

As per the company’s third-quarter earnings conference call, it expects to earn $700 million worth combined income in the form of royalties associated with Prezista, neratinib, and Xtandi and dividend income associated with its ViiV partnership in 2019.

In the next article, we’ll discuss growth trends for Pfizer’s Ibrance in greater detail.

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