Pfizer price target lowered to $42 from $43 at Morgan Stanley

Morgan Stanley lowered the firm’s price target on Pfizer (PFE) to $42 from $43 and keeps an Equal Weight rating on the shares. Patient demand for obesity medicines in the U.S., fueled by social media activity, has outstripped drug supply, while reimbursement for obesity medicines has expanded much faster than the firm had anticipated, the analyst tells investors. Over the past 12 months, the firm has upgraded its GLP-1 revenue forecasts more in diabetes than it has in obesity and now projects total diabesity sales of $51B for Novo (NVO) and $41B for Eli Lilly (LLY) in 2030, the analyst noted. Over the next 24 months, the firm anticipates that this “weight-centric focus” will broaden into new health complications, including heart failure, obstructive sleep apnea and kidney disease. The firm expects Novo Nordisk and Eli Lilly to remain diabesity leaders, with a combined 82% share of the obesity market long-term, despite increasing competition, Morgan Stanley added. Potential entry of new players into the obesity and non-alcoholic fatty liver disease, or NAFLD, market, including Pfizer, Merck (MRK), AstraZeneca (AZN) and Novartis (NVS), especially in the small molecule space, could exacerbate pricing pressure, the firm said.