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On Tuesday, investors continued to snap up shares of big pharmaceutical company Pfizer (NYSE: PFE). Somewhat counterintuitively, this week's rise came after the company announced it was ending the development of a drug in a very hot product category. On Tuesday, Pfizer's stock closed the day 1.5% higher, providing a pleasant contrast to the S&P 500 index's 0.2% dip.
Weight loss drug not a loss
Tuesday was a relatively uneventful news day for Pfizer, especially following the pharmaceutical giant's disclosure on Monday that it halted the development of its investigational weight loss drug danuglipron. This occurred after a patient suffered a liver injury during the testing of the medication.
Yet Pfizer watchers are well aware that the large and well-resourced company doesn't only have one pony in the race. It has a different treatment in its pipeline, PF-07976016, that's based on a different mechanism and is currently undergoing phase 2 clinical trials.
One analyst tracking the pharmaceutical stock didn't hesitate to point in a new research note published Tuesday morning that the company still has options. Bernstein SocGen's Courtney Breen wrote in her analysis, according to reports, that Pfizer will likely turn to its tried-and-true strategy of building up its pipeline with mergers and acquisitions, and/or licensing of products developed by peers.
Waiting for new success
Investors can be quite a hardy bunch, and collectively they seem to be shrugging off what many would consider a major setback in the lab with danuglipron. That being said, it is a setback, and Pfizer hasn't been a pharmaceutical pace-setter since the days of its Comirnaty vaccine during the coronavirus pandemic. The market is likely to start getting more impatient with the company soon.
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