What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-02-23 compared with 2022-02-24 · 203 added, 213 removed, 335 unchanged (55% of the section changed)

11 unchanged sentences

Our purpose fuels everything we do and reflects both our passion for science and our commitment to patients.

Pfizer’s growth strategy is driven by five “Bold Moves” that help us deliver breakthroughs for patients and create value for shareholders and other stakeholders:

Unleash the power of our people ;

Deliver first-in-class science ;

Transform our go-to-market model ;

Win the digital race in pharma ;

Lead the conversation .

In addition, Pfizer continues to enhance its ESG strategy, which is focused on six areas where we see opportunities to create a meaningful impact over the next decade:

In addition, Pfizer continues to enhance its ESG strategy, which is focused on six areas where we see opportunities to create a meaningful impact:

product innovation;

8 unchanged sentences

Our significant recent business development activities in 2022 include, among others:

(i) the July 2021 global collaboration with Arvinas to develop and commercialize ARV-471, an investigational oral PROTAC® (PROteolysis TArgeting Chimera) estrogen receptor protein degrader (the estrogen receptor is a well-known disease driver in most breast cancers);

(ii) the November 2021 collaboration and license agreement with Biohaven to acquire rights to commercialize rimegepant and zavegepant for the treatment and prevention of migraines outside of the U.S.

upon approval;

(iii) the November 2021 acquisition of Trillium, a clinical stage immuno-oncology company developing innovative potential therapies for the treatment of cancer;

and (iv) the December 2021 research collaboration with Beam to utilize Beam’s in vivo base editing programs, which use mRNA and lipid nanoparticles, for three targets for rare genetic diseases of the liver, muscle and central nervous system.

In addition, in December 2021, we entered into a definitive agreement to acquire Arena, a clinical stage company developing innovative potential therapies for the treatment of several immuno-inflammatory diseases.

On February 2, 2022, Arena shareholders voted to approve the proposed acquisition, which is targeted to close in the first half of 2022, subject to review under antitrust laws and other customary closing conditions.

(i) the March 2022 acquisition of Arena, a clinical stage company developing innovative potential therapies for the treatment of several immuno-inflammatory diseases;

(ii) the October 2022 acquisition of GBT, a biopharmaceutical company dedicated to the discovery, development and delivery of life-changing treatments that provide hope to underserved patient communities, starting with sickle cell disease;

and (iii) the October 2022 acquisition of Biohaven, the maker of Nurtec ODT/Vydura (rimegepant), an innovative therapy for both acute treatment of migraine and prevention of episodic migraine in adults.

For a further discussion of our strategy and our business development initiatives, see the Overview of Our Performance, Operating Environment, Strategy and Outlook section within MD&A and Note 2 .

In 2020 and 2021, our business, operations and financial condition and results were impacted by the COVID-19 pandemic.

To confront the public health challenge posed by the pandemic, we have made some important advances, including, the development of a vaccine to help prevent

2021 Form 10-K 3

COVID-19 and an oral COVID-19 treatment.

For additional information, see the Overview of Our Performance, Operating Environment, Strategy and Outlook—COVID-19 Pandemic section within MD&A and the Item 1A.

Risk Factors—COVID-19 Pandemic section in this Form 10-K.

COMMERCIAL OPERATIONS

Following (i) the spin-off and combination of the Upjohn Business (which was our global, primarily off-patent branded and generics business) with Mylan in 2020, which created a new global pharmaceutical company, Viatris, and (ii) the formation of the Consumer Healthcare JV with GSK in 2019, we saw the culmination of Pfizer’s transformation into a more focused, global leader in science-based innovative medicines and vaccines, and beginning in the fourth quarter of 2020, we operated as a single operating segment engaged in the discovery, development, manufacturing, marketing, sale and distribution of biopharmaceutical products worldwide.

At the beginning of our fiscal fourth quarter 2021, we reorganized our commercial operations and began to manage our commercial operations through a new global structure consisting of two operating segments, each led by a single manager:

In the fourth quarter of 2021, we began managing our commercial operations through a global structure consisting of two operating segments, each led by a single manager:

Biopharma, our innovative science-based biopharmaceutical business, and PC1, our global contract development and manufacturing organization and a leading supplier of specialty active pharmaceutical ingredients.

Our Biopharma business includes the following therapeutic areas and key products:

Therapeutic Area Description Key Products

Includes innovative vaccines across all ages—infants, adolescents and adults—in pneumococcal disease, meningococcal disease, tick-borne encephalitis and COVID-19, with a pipeline focus on infectious diseases with significant unmet medical need.

Comirnaty/BNT162b2*, the Prevnar family*, Nimenrix, FSME/IMMUN-TicoVac and Trumenba

Includes innovative oncology brands of biologics, small molecules, immunotherapies and biosimilars across a wide range of cancers.

Ibrance*, Xtandi*, Inlyta*, Sutent, Retacrit, Lorbrena and Braftovi

Internal Medicine

Includes innovative brands in cardiovascular metabolic and women’s health, as well as regional brands.

Eliquis* and the Premarin family

Includes our global portfolio of sterile injectable and anti-infective medicines, as well as an oral COVID-19 treatment.

Sulperazon, Medrol, Zavicefta, Zithromax, Vfend, Panzyga and Paxlovid

Inflammation & Immunology

Includes innovative brands and biosimilars for chronic immune and inflammatory diseases.

Beginning in the third quarter of 2022, we made several organizational changes to further transform our operations to better leverage our expertise in certain areas and in anticipation of potential future new product or indication launches.

2022 Form 10-K 3

The changes include establishing a new commercial structure within Biopharma, optimizing our end-to-end R&D operations and further prioritizing our internal R&D portfolio, as well as realigning certain enabling and platform functions across the organization to ensure alignment with this new operating structure, which is designed to better support and optimize performance across three broad customer groups as follows:

Customer Groups Description Key Products

• Former Internal Medicine product portfolio (innovative brands in cardiovascular metabolic, migraine and women’s health, as well as regional brands)

• Former Vaccines product portfolio (innovative vaccines across all ages with a pipeline focus on infectious diseases with significant unmet medical need)

• Products for COVID-19 prevention and treatment, and potential future mRNA and antiviral products

• Eliquis, Nurtec ODT/Vydura and the Premarin family

• The Prevnar family, Nimenrix, FSME/IMMUN-TicoVac and Trumenba

Specialty Care Includes:

• Former Inflammation & Immunology product portfolio (innovative brands and biosimilars for chronic immune and inflammatory diseases)

• Former Rare Disease product portfolio (innovative brands for a number of therapeutic areas with rare diseases, including amyloidosis, hemophilia, endocrine diseases and sickle cell disease)

• Former Hospital portfolio (global portfolio of sterile injectable and anti-infective medicines, excluding Paxlovid)

• Xeljanz, Enbrel (outside the U.S.

and Canada), Inflectra, Eucrisa/Staquis and Cibinqo

Includes innovative brands for a number of therapeutic areas with rare diseases, including amyloidosis, hemophilia and endocrine diseases.

Vyndaqel/Vyndamax*, BeneFIX and Genotropin

* Each of Prevnar 13/Prevenar 13, Ibrance, Eliquis, Xeljanz and Enbrel recorded direct product and/or Alliance revenues of more than $1 billion in 2021, 2020 and 2019.

Each of Comirnaty/BNT162b2 and Inlyta recorded direct product and/or Alliance revenues of more than $1 billion in 2021.

Each of Xtandi and Vyndaqel/Vyndamax recorded direct product and/or Alliance revenues of more than $1 billion in 2021 and 2020.

Comirnaty/BNT162b2, Eliquis and Xtandi include Alliance revenues and direct sales.

Prevnar family include revenues from Prevnar 13/Prevenar 13 (pediatric and adult) and Prevnar 20 (adult).

** Prior to the fourth quarter of 2021, PC1 had been managed within the Hospital therapeutic area.

Also, on December 31, 2021, we completed the sale of our Meridian subsidiary, which was part of the Hospital therapeutic area prior to its sale.

See Note 1A for additional information.

For additional information on our operating segments and products, see Note 17 and for additional information on the key operational revenue drivers of our business, see the Analysis of the Consolidated Statements of Income section within MD&A.

• The Vyndaqel family, Oxbryta, BeneFIX and Genotropin

• Sulperazon, Medrol, Zavicefta, Zithromax, Vfend and Panzyga

Includes innovative oncology brands of biologics, small molecules, immunotherapies and biosimilars across a wide range of cancers.

Ibrance, Xtandi, Inlyta, Retacrit, Lorbrena and Braftovi

For additional information on our operating segments and products, including product revenues, see Note 17 , and for additional information on the key operational revenue drivers of our business, see the Analysis of the Consolidated Statements of Income section within MD&A.

For a discussion of the risks associated with our dependence on certain of our major products, see the Item 1A.

Risk Factors—Concentration section in this Form 10-K.

COLLABORATION AND CO-PROMOTION

We use collaboration and/or co-promotion arrangements to enhance our development, R&D, sales and distribution of certain biopharmaceutical products, which include, among others, the following:

• Comirnaty/BNT162b2 is an mRNA-based coronavirus vaccine to help prevent COVID-19, which is being jointly developed and commercialized with BioNTech.

Pfizer and BioNTech equally share the costs of development for the Comirnaty program.

Comirnaty/BNT162b2 has been granted an approval or an authorization in many countries around the world in populations varying by country.

We also share gross profits equally from commercialization of Comirnaty/BNT162b2 and are working jointly with BioNTech in our respective territories to commercialize the vaccine worldwide (excluding China, Hong Kong, Macau and Taiwan), subject to regulatory authorizations or approvals market by market.

For discussion on Comirnaty/BNT162b2, see the Overview of Our Performance, Operating Environment, Strategy and Outlook—COVID-19 Pandemic section within MD&A.

• Eliquis (apixaban) is part of the Novel Oral Anticoagulant market and was jointly developed and commercialized with BMS as an alternative treatment option to warfarin in appropriate patients.

We fund between 50% and 60% of all development costs depending on the study, and profits and losses are shared equally except in certain countries where we commercialize Eliquis and pay a percentage of net sales to BMS.

In certain smaller markets we have full commercialization rights and BMS supplies the product to us at cost plus a percentage of the net sales to end-customers.

• Xtandi (enzalutamide) is an androgen receptor inhibitor that blocks multiple steps in the androgen receptor signaling pathway within tumor cells that is being developed and commercialized in collaboration with Astellas.

We share equally in the gross profits and losses related to U.S.

net sales and also share equally all Xtandi commercialization costs attributable to the U.S.

market, subject to certain exceptions.

In addition, we share certain development and other collaboration expenses.

For international net sales we receive royalties based on a tiered percentage.

• Bavencio (avelumab) is a human anti-programmed death ligand-1 (PD-L1) antibody that is being developed and commercialized in collaboration with Merck KGaA.

We jointly fund the majority of development and commercialization costs and split profits equally related to net sales generated from any products containing avelumab.

• Orgovyx (relugolix) is an oral gonadotropin-releasing hormone (GnRH) receptor antagonist for the treatment of adult patients with advanced prostate cancer that is being developed and commercialized with Myovant.

The companies are also collaborating on Myfembree (relugolix 40

2021 Form 10-K 4

mg, estradiol 1.0 mg, and norethindrone acetate 0.5 mg) for heavy menstrual bleeding associated with uterine fibroids in premenopausal women and the management of moderate to severe pain associated with endometriosis.

The companies will equally share profits and allowable expenses in the U.S.

and Canada for Orgovyx and Myfembree, with Myovant bearing our share of allowable expenses up to a maximum of $50 million in 2022.

Myovant will remain responsible for regulatory interactions and drug supply and continue to lead clinical development for the relugolix combination tablet.

Revenues associated with these arrangements are included in Alliance revenues (except in certain markets where we have direct sales and except for the majority of revenues for Comirnaty/BNT162b2, which are included as direct product revenues).

In addition, we have collaboration arrangements for the development and commercialization of certain pipeline products that are in development stage, including, among others, (i) with BioNTech to develop a modified mRNA-based vaccine for the prevention of varicella zoster (Shingles), and (ii) with Valneva to co-develop and commercialize Valneva’s Lyme disease vaccine candidate, VLA15.

For further discussion of collaboration and co-promotion agreements, see the Item 1A.

Risk Factors—Collaborations and Other Relationships with Third Parties section in this Form 10-K and Notes 2 and 17 .

RESEARCH AND DEVELOPMENT

R&D is at the heart of fulfilling our purpose to deliver breakthroughs that change patients’ lives as we work to translate advanced science and technologies into the therapies that may be the most impactful for patients.

The discovery and development of drugs, vaccines and biological products are time consuming, costly and unpredictable.

In addition to discovering and developing new products, our R&D efforts seek to add value to our existing products by improving their effectiveness and ease of dosing and by discovering potential new indications.

4 unchanged sentences

• advancing new models for partnerships with creativity, flexibility and urgency to deliver innovation to patients as quickly as possible.

To that end, our R&D primarily focuses on our main therapeutic areas.

While a significant portion of our R&D is internal, we also seek promising chemical and biological lead molecules and innovative technologies developed by others to incorporate into our discovery and development processes or projects, as well as our product lines.

To that end, our R&D primarily focuses on our main therapeutic areas, which are inflammation and immunology, internal medicine, oncology, rare diseases, vaccines, and anti-infectives.

We do so by entering into collaboration, alliance and license agreements with universities, biotechnology companies and other firms as well as through acquisitions and investments.

7 unchanged sentences

We can rapidly redeploy resources within a research unit and between various projects to leverage, as necessary, common skills, expertise or focus.

Our GPD organization is a unified center for clinical development and regulatory activities that is generally responsible for the clinical development strategy and operational execution of clinical trials for late-stage clinical assets in Pfizer’s pipeline.

• Science-based platform-services organizations within WRDM.

These organizations provide technical expertise and other services to various R&D projects, and are organized into science-based functions.

Science-based platform-services organizations within WRDM provide technical expertise and other services to various R&D projects and are organized into science-based functions.

These organizations allow us to react more quickly and effectively to evolving needs by sharing resources among projects, candidates and targets across therapeutic areas and phases of development.

Examples of these platform organizations include Pharmaceutical Sciences and Medicine Design, and Worldwide Medical and Safety.

We manage R&D operations on a total-company basis through our platform functions described above.

Specifically, the Portfolio Strategy & Investment committee, composed of senior executives, is accountable for aligning resources among all of our WRDM, GPD and R&D projects and for seeking to ensure optimal capital allocation across the innovative R&D portfolio.

Specifically, the Portfolio Management Team (PMT), composed of senior executives, is accountable for aligning resources among all of our WRDM, GPD and R&D projects and for seeking to ensure optimal capital allocation across the innovative R&D portfolio.

We believe that this approach also serves to maximize accountability and flexibility.

We do not disaggregate total R&D expense by development phase or by therapeutic area since, as described above, we do not manage our R&D operations by development phase or by therapeutic area.

Further, as we are able to adjust a significant portion of our spending quickly, we believe that any prior-period information about R&D expense by development phase or by therapeutic area would not necessarily be representative of future spending.

For additional information, see the Costs and Expenses — Research and Development (R&D) Expenses section within MD&A and Note 17 .

2022 Form 10-K 4

We do not disaggregate total R&D expense by development phase or by therapeutic area since, as described above, we do not manage all of our R&D operations by development phase or by therapeutic area.

For additional information, see the Costs and Expenses — Research and Development Expense s section within MD&A and Note 17 .

Our R&D Pipeline.

The process of drug and biological product discovery from initiation through development and to potential regulatory approval is lengthy and can take more than ten years.

As of February 8, 2022, we had the following number of projects in various stages of R&D:

As of January 31, 2023, we had the following number of projects in various stages of R&D:

Development of a single compound is often pursued as part of multiple programs.

1 unchanged sentence

Information concerning several of our drug candidates in development, as well as supplemental filings for existing products, is set forth in the Product Developments section within MD&A.

The discovery and development of drugs, vaccines and biological products are time consuming, costly and unpredictable.

For information on the risks associated with R&D, see the Item 1A.

Risk Factors—Research and Development section of this Form 10-K.

Risk Factors—Research and Development section in this Form 10-K.

COLLABORATION AND CO-PROMOTION

We use collaboration and/or co-promotion arrangements to enhance our development, R&D, sales and distribution of certain biopharmaceutical products, which include, among others, the following:

• Comirnaty is an mRNA-based coronavirus vaccine to help prevent COVID-19, which is being jointly developed and commercialized with BioNTech.

Pfizer and BioNTech equally share the costs of development for the Comirnaty program.

Comirnaty has been granted an approval or an authorization in many countries around the world in populations varying by country.

We also share gross profits equally from commercialization of Comirnaty and are working jointly with BioNTech in our respective territories to commercialize the vaccine worldwide (excluding China, Hong Kong, Macau and Taiwan), subject to regulatory authorizations or approvals market by market.

For discussion on Comirnaty, see the Overview of Our Performance, Operating Environment, Strategy and Outlook—COVID-19 section within MD&A.

• Eliquis (apixaban) is part of the Novel Oral Anticoagulant market and was jointly developed and commercialized with BMS as an alternative treatment option to warfarin in appropriate patients.

In certain smaller markets we have full commercialization rights and BMS supplies the product to us at cost plus a percentage of the net sales to end-customers.

We share equally in the gross profits and losses related to U.S.

net sales and also share equally all Xtandi commercialization costs attributable to the U.S.

market, subject to certain exceptions.

In addition, we share certain development and other collaboration expenses.

For international net sales we receive royalties based on a tiered percentage.

• Bavencio (avelumab) is a human anti-programmed death ligand-1 (PD-L1) antibody that is being developed and commercialized in collaboration with Merck KGaA.

We jointly fund the majority of development and commercialization costs and split profits equally related to net sales generated from any products containing avelumab.

The companies are also collaborating on Myfembree (relugolix 40 mg, estradiol 1.0 mg, and norethindrone acetate 0.5 mg) for heavy menstrual bleeding associated with uterine fibroids in premenopausal women and the management of moderate to severe pain associated with endometriosis in premenopausal women.

The companies equally share profits and allowable expenses in the U.S.

for Orgovyx, and in the U.S.

and Canada for Myfembree, with Myovant bearing our share of allowable expenses up to a maximum of $50 million in 2022.

Pfizer does not have rights outside of these markets.

Myovant remains responsible for regulatory interactions and drug supply and continues to lead clinical development for the relugolix combination tablet.

For further discussion of collaboration and co-promotion agreements, see the Item 1A.

Risk Factors—Collaborations and Other Relationships with Third Parties section in this Form 10-K and Notes 2 and 17 .

INTERNATIONAL OPERATIONS

Our operations are conducted globally, and we sell our products in over 125 countries.

Our operations are conducted globally, and we supply our medicines and vaccines to over 185 countries and territories.

Emerging markets are an important component of our strategy for global leadership, and our commercial structure recognizes that the demographics and rising economic power of the fastest-growing emerging markets are becoming more closely aligned with the profile found within developed markets.

Urbanization and the rise of the middle class in emerging markets provide potential growth opportunities for our products.

2022 Form 10-K 5

Revenues from operations outside the U.S.

1 unchanged sentence

Revenues exceeded $500 million in each of 24, 21 and 8 countries outside the U.S.

in 2021, 2020 and 2019, respectively, with the increase in the number of countries in 2021 primarily driven by Comirnaty/BNT162b2.

By total revenues, Japan was our largest national market outside the U.S.

For a geographic breakdown of revenues, see the Analysis of the Consolidated Statements of Income — Revenues by Geography section within MD&A and the table captioned Geographic Information in Note 17B .

in 2022, 2021 and 2020, respectively.

The increase in the number of countries exceeding $500 million in revenues in 2022 and 2021 was primarily driven by Comirnaty as well as, in 2022, Paxlovid.

As a percentage of revenues, our largest country outside the U.S.

was Japan in 2022.

For a geographic breakdown of revenues, see the Revenues by Geography section within MD&A and Note 17 B .

Our international operations are subject to risks inherent in carrying on business in other countries.

3 unchanged sentences

SALES AND MARKETING

Our prescription biopharmaceutical products are sold principally to wholesalers, but we also sell directly to retailers, hospitals, clinics, government agencies and pharmacies.

Our prescription biopharmaceutical products, with the exception of Paxlovid, are sold principally to wholesalers, but we also sell directly to retailers, hospitals, clinics, government agencies and pharmacies.

In 2022, we principally sold Paxlovid to government agencies.

In the U.S., we primarily sell our vaccines directly to the federal government, CDC, wholesalers, individual provider offices, retail pharmacies and integrated delivery systems.

1 unchanged sentence

Certain of these government contracts may be renegotiated or terminated at the discretion of a government entity.

In addition, our contracts with government and supranational organizations for the sales of Comirnaty/BNT162b2 and Paxlovid, which are on a committed basis, represented a significant amount of revenues in 2021.

In addition, our contracts with government and supranational organizations for the sales of Comirnaty and Paxlovid, which are binding contracts, represented a significant amount of revenues in 2022.

To date, we primarily sold Comirnaty and Paxlovid globally under government contracts.

We expect sales of Comirnaty and Paxlovid in the U.S.

will transition to commercial channels in the second half of 2023.

We also seek to gain access for our products on formularies, which are lists of approved medicines available to members of healthcare programs or PBMs.

2 unchanged sentences

For information on our significant customers, see Note 17 C .

We promote our products to healthcare providers and patients.

We promote our products to healthcare providers and patients consistent with applicable laws.

Through our marketing organizations, we explain the approved uses, benefits and risks of our products to healthcare providers and patients;

3 unchanged sentences

In addition, we sponsor general advertising to educate the public on disease awareness, prevention and wellness, important public health issues and our patient assistance programs.

2021 Form 10-K 6

As part of our commitment to engaging our customers in the manner they prefer, we took a hybrid approach of virtual and in person engagements and see positive customer response to both approaches.

During the COVID-19 pandemic, we adapted our promotional platform by amplifying our digital capabilities to reach healthcare professionals and customers to provide critical education and information, including increasing the scale of our remote engagement.

PATENTS AND OTHER INTELLECTUAL PROPERTY RIGHTS

5 unchanged sentences

is the lack of effective intellectual property protection for our products, although international and U.S.

free trade agreements have included some improved global protection of intellectual property rights.

free trade agreements have included some global protection of intellectual property rights.

For additional information, see the Item 1.

2 unchanged sentences

The scope and term of such exclusivity will vary but, in general, the period will run concurrently with the term of any existing patent rights associated with the drug at the time of approval.

2022 Form 10-K 6

Based on current sales, and considering the competition with products sold by our competitors, the patent rights we consider most significant in relation to our business as a whole, together with the year in which the basic product patent expires, are as follows:

2 unchanged sentences

Japan Basic Product Patent Expiration Year (1)

Chantix/Champix 2020 (2)

Sutent 2021 (3)

Inlyta 2025 2025 2025

3 unchanged sentences

Ibrance 2027 2028 2028

Vyndaqel/Vyndamax/Vynmac 2024

(2028 pending PTE) 2026 2026/2029 (8)

Vyndaqel/Vyndamax/Vynmac 2024 (2028 pending PTE) 2026 2026/2029 (6)

Xalkori 2029 2027 2028

Besponsa 2030 2028 2028 (4)

Nurtec ODT/Vydura 2030 (2034 pending PTE) 2030 (2035 pending SPC) 2030 (7)

2030 (2031 pending PTE) (8)

Bavencio (11)

2033 2032 2033

Oxbryta 2033 2032 (2037 pending SPC) 2032 (7)

Lorbrena 2033 2034 2036

Prevnar 20/Apexxnar 2033

(2035 pending PTE) 2033 2033 (12)

Cibinqo 2034 2034 (13)

(2038 pending PTE)

Comirnaty (14)

Prevnar 20/Apexxnar 2033 (2035 pending PTE) 2033 (2037 pending SPC) 2033 (7)

Cibinqo 2034 (2036 pending PTE) 2034 (2036 pending SPC) 2034 (2038 pending PTE)

Pfizer-BioNTech COVID-19 Vaccine (12)

Paxlovid 2041 2041 2041

Pfizer-BioNTech COVID-19 Vaccine, Bivalent (Original and Omicron BA.4/BA.5)/ Comirnaty Original/Omicron BA.1 Vaccine

(1) Unless otherwise indicated, the years pertain to the basic product patent expiration, including granted PTEs, supplementary protection certificates (SPC) or pediatric exclusivity periods.

3 unchanged sentences

In some instances, there are later-expiring patents relating to our products which may or may not protect our product from generic or biosimilar competition after the expiration of the basic patent.

(2) The basic product patent for Chantix expired in the U.S.

in November 2020 and in Europe in September 2021.

(3) The basic product patent for Sutent expired in the U.S.

in August 2021 and in Europe in January 2022.

(2) Expiry is provided by regulatory exclusivity in this market.

2 unchanged sentences

(4) Eliquis was developed and is being commercialized in collaboration with BMS.

For Eliquis in the U.S., two patents listed in the FDA Orange Book, the composition of matter patent claiming apixaban specifically and a formulation patent, were challenged by numerous generic companies and were the subject of patent infringement litigation.

Prior to the resolution of the litigation in our favor on both challenged patents, we and BMS settled with a number of these generic companies (settled generic companies) while continuing to litigate against three remaining generic companies (remaining generic companies).

As a result of the litigation, the remaining generic companies are not permitted to launch their products until the 2031 expiration date of the formulation patent.

Under the terms of the settlement agreements, the permitted date of launch for the settled generic companies under these patents is April 1, 2028.

Both patents may be subject to subsequent challenges.

While we cannot predict the outcome of any potential future litigation, these are the alternatives that might occur:

(a) if both patents are upheld in future litigation, through appeal, the permitted date of launch for the settled generic companies under these patents would remain April 1, 2028;

(b) if the formulation patent is held invalid or not infringed in future litigation, through appeal, the settled generic companies and any successful future litigant would be permitted to launch on November 21, 2026;

or (c) if both patents are held invalid or not infringed in future litigation, through appeal, the settled generic companies and any successful future litigant could launch products immediately upon such an adverse decision.

In the U.S., we and BMS previously settled certain patent litigations with a number of generic companies permitting their launch of a generic version of Eliquis on April 1, 2028 (the settled generic companies).

We continued to litigate against three remaining generic companies and following the resolution of the litigation in our favor, the three generic companies are not permitted to launch their products until the 2031 expiration date of the formulation patent.

Both the composition of matter patent expiring in November 2026 and the formulation patent expiring in 2031 may be subject to future challenges.

While we cannot predict the outcome of any potential future litigation, there are certain potential alternatives that might occur which could potentially permit generic launch prior to April 1, 2028:

(a) if the formulation patent is held invalid or not infringed in future litigation, through appeal, the settled generic companies and any successful future litigant would be permitted to launch on November 21, 2026;

or (b) if both patents are held invalid or not infringed in future litigation, through appeal, the settled generic companies and any successful future litigant could launch products immediately upon such an adverse decision.

Refer to Note 16A1 for more information.

2021 Form 10-K 7

(5) Xtandi is being developed and commercialized in collaboration with Astellas, which has exclusive commercialization rights for Xtandi outside the U.S.

1 unchanged sentence

(6) Vyndaqel (tafamidis meglumine) basic patent expiry in Japan is August 2026 for treatment of polyneuropathy.

Vynmac (tafamidis) was approved in Japan for treatment of cardiomyopathy with regulatory exclusivity expiring March 2029.

(9) We have exclusive rights to Braftovi and Mektovi in the U.S.

The Pierre Fabre Group has exclusive rights to commercialize both products in Europe and Ono Pharmaceutical Co., Ltd.

has exclusive rights to commercialize both products in Japan.

We receive royalties from The Pierre Fabre Group and Ono Pharmaceutical Co., Ltd.

on sales of Braftovi and Mektovi outside the U.S.

Vynmac (tafamidis) was approved in Japan for treatment of cardiomyopathy with regulatory exclusivity expiring in March 2029.

(7) Product not yet approved or authorized in this market.

(8) We have exclusive rights to Braftovi and Mektovi in the U.S., Canada and certain emerging markets.

The Pierre Fabre Group has exclusive rights to commercialize both products in Europe and Ono has exclusive rights to commercialize both products in Japan.

We receive royalties from The Pierre Fabre Group and Ono on sales of Braftovi and Mektovi in majority of markets outside the U.S.

(9) Mektovi U.S.

expiry is provided by a method of use patent.

(11) Bavencio is being developed and commercialized in collaboration with Merck KGaA.

(12) Product not yet approved or authorized in this market.

(13) An SPC has been filed for Cibinqo in the U.K.

with expected expiry in 2036 based on the September 2021 approval.

Cibinqo was approved in other major European markets in December 2021.

(14) The basic product patent application for Comirnaty has been filed in these markets.

If granted, a full term is expected in these markets.

Comirnaty is being developed and commercialized in collaboration with BioNTech .

(15) Pfizer does not have co-promotion rights for Comirnaty in Germany.

(16) The basic product patent application for Paxlovid has been filed in these markets.

(10) Ngenla is being developed in collaboration with OPKO.

(11) Expiry expected to be provided by regulatory exclusivity in this market.

(12) The basic product patent application has been filed in these markets.

If granted, a full term is expected in these markets.

Product is being developed and commercialized in collaboration with BioNTech.

(13) Pfizer does not have co-promotion rights for this product in Germany.

Loss of Intellectual Property Rights.

The loss, expiration or invalidation of intellectual property rights, patent litigation settlements with manufacturers and the expiration of co-promotion and licensing rights can have a material adverse effect on our revenues.

The loss, expiration or invalidation of intellectual property rights, patent litigation settlements and the expiration of co-promotion and licensing rights can have a material adverse effect on our revenues.

Once patent protection has expired or has been lost prior to the expiration date as a result of a legal challenge, we typically lose exclusivity on these products, and generic and biosimilar pharmaceutical manufacturers generally produce identical or highly similar products and sell them for a lower price.

The date at which generic or biosimilar competition commences may be different from the date that the patent or regulatory exclusivity expires.

The date at which generic or

2022 Form 10-K 7

biosimilar competition commences may be different from the date that the patent or regulatory exclusivity expires.

However, when generic or biosimilar competition does commence, the resulting price competition can substantially decrease our revenues for the impacted products, often in a very short period of time.

4 unchanged sentences

Certain of our products have experienced patent-based expirations or loss of regulatory exclusivity in certain markets in the last few years, and we expect certain products to face increased generic competition over the next few years.

For additional information on the impact of LOEs on our revenues, see the Analysis of the Consolidated Statements of Income––Revenues––Selected Product Discussion section within MD&A.

For example, the basic product patent for Sutent expired in the U.S.

in 2021 and in Europe in 2022.

There is no assurance that a particular product will enjoy market exclusivity for the full time period that appears in the estimates included in this Form 10-K or that we assume when we provide our financial guidance.

For additional information on the impact of LOEs on our revenues, see the Overview of Our Performance, Operating Environment, Strategy and Outlook—Our 2022 Performance section within MD&A.

Our products are sold under brand-name and logo trademarks and trade dress.

9 unchanged sentences

In addition, several of our competitors operate without large R&D expenses and make a regular practice of challenging our product patents before their expiration.

To address competitive trends we continually emphasize innovation, which is underscored by our multi-billion-dollar investment in R&D, as well as our business development transactions, both designed to result in a strong product pipeline.

Our investment in research continues even after drug or vaccine approval as we seek to further demonstrate the value of our products for the conditions they treat or prevent, as well as potential new applications.

7 unchanged sentences

Our biosimilars, which include biosimilars of certain inflammation & immunology and oncology biologic medicines, compete with branded products from competitors, as well as other generics and biosimilars manufacturers.

We seek to maximize the opportunity to establish a “first-to-

2021 Form 10-K 8

market” or early market position for our biosimilars to provide customers a lower-cost alternative immediately when available and also to potentially provide us with higher levels of sales and profitability until other competitors enter the market.

We seek to maximize the opportunity to establish a “first-to-market” or early market position for our biosimilars to provide customers a lower-cost alternative immediately when available and also to potentially provide us with higher levels of sales and profitability until other competitors enter the market.

Generic Products .

15 unchanged sentences

Public Health Service Act.

2022 Form 10-K 8

PRICING PRESSURES AND MANAGED CARE ORGANIZATIONS

3 unchanged sentences

providers to deliver healthcare at a lower cost and to ensure that those expenditures deliver demonstrated value in terms of health outcomes.

Many employers have adopted high deductible health plans, which can increase out-of-pocket costs for medicines.

Many employers have adopted or make available high deductible health plans, which can increase out-of-pocket costs for medicines.

This trend is likely to continue.

Private third-party payers, such as health plans, increasingly challenge pharmaceutical product pricing, which could result in lower prices, lower reimbursement rates and a reduction in demand for our products.

Private third-party payers, such as health plans, increasingly challenge pharmaceutical product pricing, which could result in lower prices, lower reimbursement rates for payors and a reduction in demand for our products, including denial of coverage of our products, if lower cost alternatives are available.

Pricing pressures also may occur as a result of highly competitive insurance markets.

Healthcare provider purchasers, directly or through group purchasing organizations, are seeking enhanced discounts or implementing more rigorous bidding or purchasing review processes.

Longer term, we foresee a shift in focus away from fee-for-service payments towards outcomes-based payments and risk-sharing arrangements that reward providers for cost reductions and improved patient outcomes.

Longer term, we foresee a shift among payors and their pharmacy benefits managers in focus away from fee-for-service reimbursement towards outcomes-based payments and risk-sharing arrangements that reward providers and pharmaceutical manufacturers for cost reductions and improved patient outcomes.

These new payment models can, at times, lead to lower prices for, and restricted access to, new medicines.

At the same time, these models can also promote utilization of drugs by encouraging physicians to screen and diagnose and consider drugs as a means of forestalling more costly medical interventions.

In light of the COVID-19 pandemic and related large-scale healthcare disruptions, we expect value-based payment models may have reduced participation if the incentives to participate are reduced or eliminated.

Financially weakened hospitals may weigh their ability to take on the financial risk of downside models.

In contrast, providers in more advanced value-based models, such as full capitation, a fixed amount paid in advance per patient per unit of time-period, generally found their revenues remained steady during the pandemic, which may ultimately encourage the growth of such models.

Further, these models may also encourage payors and their pharmacy benefits managers to cover higher cost drugs where coverage is tied to patient outcomes and other quality incentives.

The impact of COVID-19 and related large-scale healthcare disruptions on the pace of adoption of value-based payment models remains unclear.

Both payors and providers may resist adopting such models or choose to adopt such models at a slower pace if the incentives available do not outweigh the financial risk involved.

Unprecedented pressures on critical care and the reductions in elective surgeries during the COVID-19 pandemic undermined revenue predictability for hospitals and other institutional providers.

As a result, providers may weigh their ability to take on the financial risk of downside value-based payment models.

In contrast, providers in more advanced value-based payment models, such as full capitation, a fixed amount paid in advance per patient per unit of time-period, generally found their revenues remained steady during the pandemic, which may ultimately encourage the growth of such models.

Going forward, we expect continued focus on value-based payment models that support financial resiliency and advance health care equity by incorporating features intended to reduce disparities in health care quality and access experienced by underrepresented and underserved populations.

We believe medicines and vaccines are the most efficient and effective use of healthcare dollars based on the value they deliver to the overall healthcare system.

6 unchanged sentences

payers throughout the product-development process to better understand how these entities value our compounds and products.

Further, we are developing stronger internal capabilities focused on demonstrating the value of the medicines and vaccines that we discover or develop, register and manufacture, by recognizing patterns of usage of our medicines and vaccines and competitor medicines and vaccines along with patterns of healthcare costs.

Further, we are developing stronger support to demonstrate the net value of the medicines and vaccines that we discover or develop, register and manufacture.

For information on government pricing pressures, see the Item 1.

8 unchanged sentences

In particular, the influence of MCOs has increased in recent years due to the growing number of patients receiving coverage through MCOs.

At the same time, consolidation in the MCO industry has resulted in fewer, even larger MCOs, which enhances those MCOs’ ability to negotiate pricing and increases their importance to our business.

Since MCOs seek to contain and reduce healthcare expenditures, their growing influence has increased pressure on drug prices as well as revenues.

MCOs typically negotiate prices with pharmaceutical providers by using formularies (which are lists of approved medicines available to MCO members), clinical protocols (which require prior authorization for a branded product if a generic product is available or require the patient to first fail on one or more generic products before permitting access to a branded medicine), volume purchasing, long-term contracts and their ability to influence volume and market share of prescription drugs.

In addition, by placing branded medicines on higher-tier or non-preferred status in their formularies, MCOs transfer a portion of the cost to the patient, resulting in significant patient out-of-pocket expenses.

At the same time, consolidation in the MCO industry has resulted in fewer, even larger MCOs, which enhances those MCOs’ ability to negotiate lower pricing and further increases their importance to our business.

Since MCOs seek to contain and reduce healthcare expenditures, their growing influence has increased downward pressure on drug prices, as well as negatively impacted revenues.

MCOs and their PBMs typically negotiate prices with pharmaceutical providers by using formularies (which are lists of approved medicines available to MCO members), clinical protocols (which require prior authorization for a branded product if a generic product is available or require the patient to first fail on one or more generic products before permitting access to a branded medicine), volume purchasing, long-term contracts and their ability to influence volume and market share of prescription drugs.

In addition, by placing branded medicines on higher-tier or non-preferred status in their formularies, MCOs transfer to the patient higher patient out-of-pocket expenses.

This financial disincentive is a tool for MCOs to manage drug costs and channel patients to medicines preferred by the MCOs.

The ACA has accelerated payment reform by distributing risk across MCOs and other stakeholders in care delivery with the intent of improving quality while reducing costs, which creates

2021 Form 10-K 9

pressure on MCOs to tie reimbursement to defined outcomes.

We are closely monitoring these newer approaches and developing appropriate strategies to respond to them.

We expect payment reforms for MCOs will continue to evolve with increased emphasis on expanded participation and on removing barriers to equitable health care.

The breadth of the products covered by formularies can vary considerably from one MCO to another, and many formularies include alternative and competitive products for treatment of particular medical problems.

MCOs also emphasize primary and preventive care, out-patient treatment and procedures performed at doctors’ offices and clinics as ways to manage costs.

Hospitalization and surgery, typically the most expensive forms of treatment, are carefully managed, and drugs that can reduce the need for hospitalization, professional therapy or surgery may become favored first-line treatments for certain diseases.

MCOs emphasize primary and preventive care, out-patient treatment and procedures performed at doctors’ offices and clinics as ways to manage costs.

Hospitalization and surgery, typically the most expensive forms of treatment, are carefully managed, and drugs that can help in chronic care management and reduce the need for hospitalization, professional therapy or surgery may become favored first-line treatments for certain diseases.

At the same time, MCOs may seek to exclude high-cost drugs from formularies in their efforts to manage and lower their costs.

Exclusion of a product from a formulary or other MCO-implemented restrictions can significantly impact drug usage in the MCO patient population and beyond.

Consequently, pharmaceutical companies compete to gain access to formularies for their products, typically on the basis of unique product features, such as greater efficacy, better patient ease of use, or fewer side effects, as well as the overall cost of the therapy.

We have been generally, although not universally, successful in having our major products included on MCO formularies.

We continue to seek to ensure that our major products are included on MCO formularies.

However, increasingly our branded products are being placed on the higher tiers or in a non-preferred status.

5 unchanged sentences

No significant impact to our operations due to the availability of raw materials is currently anticipated in 2023.

However, we are seeing an increase in overall demand in the industry for certain components and raw materials with the potential to constrain available supply, which could have a future impact on our business.

However, we are seeing an increase in overall demand in the industry for certain components and raw materials, which could potentially result in constraining available supply leading to a possible future impact on our

2022 Form 10-K 9

We are continuing to monitor and implement mitigation strategies in an effort to reduce any potential risk or impact, including active supplier management, qualification of additional suppliers and advanced purchasing to the extent possible.

1 unchanged sentence

We are subject to extensive regulation by government authorities in the countries in which we do business.

This includes laws and regulations governing the operations of biopharmaceutical companies, such as the approval, manufacturing and marketing of products, pricing (including discounts and rebates) and health information privacy, among others.

These laws and regulations may require administrative guidance for implementation, and a failure to comply could subject us to legal and/or administrative actions.

11 unchanged sentences

A drug or biologic may be subject to postmarketing commitments, which are studies or clinical trials that the product sponsor agrees to conduct, or postmarketing requirements, which are studies or clinical trials that are required as a condition of approval.

In addition, we are also required to report adverse events and comply with cGMPs (the FDA regulations that govern all aspects of manufacturing quality for pharmaceuticals) and the Drug Supply Chain Security Act (the law that, among other things, sets forth requirements related to product tracing, product identifiers and verification for manufacturers, wholesale distributors, repackagers and dispensers to facilitate the tracing of product through the pharmaceutical distribution supply chain), as well as advertising and promotion regulations.

In addition, we are also required to report adverse events and comply with cGMP (the FDA regulations that govern all aspects of manufacturing quality for pharmaceuticals) and the Drug Supply Chain Security Act (the law that, among other things, sets forth requirements related to product tracing, product identifiers and verification for manufacturers, wholesale distributors, repackagers and dispensers to facilitate the tracing of product through the pharmaceutical distribution supply chain), as well as advertising and promotion regulations.

For additional information, see the Item 1A.

Risk Factors — Development, Regulatory Approval and Marketing of Products and — Post-Authorization/Approval Data sections in this Form 10-K.

In the context of public health emergencies, like the COVID-19 pandemic, we may apply to the FDA for an EUA, which if granted, allows for the distribution and use of our products during the declared emergency, in accordance with the conditions set forth in the EUA, unless the EUA is otherwise terminated by the government.

In the context of public health emergencies, like the COVID-19 pandemic, we may apply to the FDA for an EUA, which, if granted, allows for the distribution and use of our products during the declared emergency, in accordance with the conditions set forth in the EUA, unless the EUA is terminated by the government.

Although the criteria for an EUA differ from the criteria for approval of an NDA or BLA, EUAs nevertheless require the development and submission of data to satisfy the relevant FDA standards, and a number of ongoing obligations.

2 unchanged sentences

The FDA is responsible for approval of biosimilars.

Innovator biologics are entitled to 12 years of market exclusivity by statute, and biosimilars applications may not be submitted until four years after the approval of the reference innovator biologic.

Innovator biologics, or reference products, are entitled to 12 years exclusivity.

Applications for biosimilars may not be submitted until four years after the date on which the reference product was first licensed and may not be approved until 12 years after the reference product was first licensed.

Sales and Marketing Regulations .

Our marketing practices are subject to state laws, as well as federal laws, such as the Anti-Kickback Statute and False Claims Act, intended to prevent fraud and abuse in the healthcare industry.

The Anti-Kickback Statute generally prohibits corruptly soliciting, offering, receiving, or paying anything of value to generate business.

The Anti-Kickback Statute prohibits corruptly soliciting, offering, receiving, or paying anything of value to generate business.

The False Claims Act generally prohibits anyone from knowingly and willingly presenting, or causing to be presented, any claims for payment for goods or services, including to government payers, such as Medicare and Medicaid, that are false or fraudulent and generally treat claims generated through kickbacks as false or fraudulent.

The federal government and states also regulate sales and marketing activities and financial interactions between manufacturers and healthcare providers, requiring disclosure to government authorities and the public of such interactions, and the adoption of compliance standards or programs.

2021 Form 10-K 10

attorneys general have also taken action to regulate the marketing of prescription drugs under state consumer protection and false advertising laws.

State attorneys general have also taken action to regulate the marketing of prescription drugs under state consumer protection and false advertising laws.

Pricing, Reimbursement and Access Regulations.

4 unchanged sentences

The calculations necessary to determine the prices reported are complex and the failure to do so accurately may expose us to enforcement measures.

See the discussion regarding rebates in the Analysis of the Consolidated Statements of Income — Revenues by Geography section within MD&A and Note 1H.

See the discussion regarding rebates in the Revenue Deductions section within MD&A and Note 1 G .

Government and private payers routinely seek to manage utilization and control the costs of our products, and there is considerable public and government scrutiny of pharmaceutical pricing.

1 unchanged sentence

We expect to see continued focus by Congress and the Biden Administration on regulating pricing, which could result in legislative and regulatory changes designed to control costs.

For example, there is proposed legislation that, if enacted, would allow Medicare to negotiate prices for certain prescription drugs, as well as require that penalties be paid by manufacturers who raise drug prices faster than inflation.

For example, in August 2022, the IRA was signed into law, which, among other things, requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023), and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).

We continue to evaluate the impact of the IRA on our business, operations and financial condition and results as the full effect of the IRA on our business and the pharmaceutical industry remains uncertain.

In addition, changes to the Medicaid program or the federal 340B drug pricing program, which imposes ceilings on prices that drug manufacturers can charge for medications sold to certain health care facilities, could have a material impact on our business.

For example, certain changes issued in a final rule by the Centers for Medicare & Medicaid Services (CMS) in December 2020 to the Medicaid Drug Rebate Program could increase our Medicaid rebate obligations and increase the discounts we extend to 340B covered entities.

2022 Form 10-K 10

certain changes finalized by the CMS in December 2020 for the Medicaid Drug Rebate Program may increase our Medicaid liability, including for drugs that are considered to be “new formulations” of existing drugs.

Additional changes to the 340B program are undergoing review and their status is unclear.

In 2022, we implemented a policy that will help improve contract pharmacy integrity.

The HHS has sent letters to numerous manufacturers that have also implemented contract pharmacy integrity initiatives expressing the view that their programs are in violation of the 340B statute, and referring those programs for potential enforcement action.

Several manufacturers have challenged HHS’s enforcement letters in federal court and litigation is ongoing in those cases.

We believe that our program is consistent with the statute.

Additional legal or legislative developments at the federal or state level with respect to the 340B program may have an adverse impact on our integrity initiative, and we may face enforcement action or penalties, depending upon such developments.

For additional information, see the Item 1A.

4 unchanged sentences

States’ budgets were impacted less by the COVID-19 pandemic than expected and are generally growing.

We expect states to seek cost cutting within Medicaid, which may focus on managed care capitation payments and/or formulary management.

States may also advance drug-pricing initiatives with a focus on affordability review boards, financial penalties related to pricing practices, manufacturer pricing and reporting requirements, as well as regulation of prescription drug assistance or copay accumulator programs in the commercial market.

However, we expect states will continue to seek cost cutting within Medicaid, which may focus on managed care capitation payments and/or formulary management.

States may also advance drug-pricing initiatives with a focus on affordability review boards, financial penalties related to pricing practices, manufacturer pricing and reporting requirements, as well as regulation of prescription drug assistance, copay accumulator, or copay maximizer programs in the commercial market.

Payers may promote generic drugs and biosimilars more aggressively to generate savings and attempt to stimulate additional price competition.

14 unchanged sentences

In the U.K., the Medicines and Healthcare Products Regulatory Agency is the sole regulatory authority.

In Japan, the PMDA is involved in a wide range of regulatory activities, including clinical studies, approvals, post-marketing reviews and pharmaceutical safety.

In China, the NMPA is the primary regulatory authority for approving and supervising medicines.

In Japan, the Pharmaceuticals and Medical Device Agency is involved in a wide range of regulatory activities, including clinical studies, approvals, post-marketing reviews and pharmaceutical safety.

In China, the National Medical Product Administration is the primary regulatory authority for approving and supervising medicines.

Health authorities in many middle- and lower-income countries require marketing approval by a recognized regulatory authority (e.g., the FDA or EMA) before they begin to conduct their application review process and/or issue their final approval.

4 unchanged sentences

Certain governments, including in the different EU member states, the U.K., Japan, China, Canada and South Korea, provide healthcare at low-to-zero direct cost to consumers at the point of care and have significant power to regulate pharmaceutical prices or patient reimbursement levels to control costs for the government-sponsored healthcare system, particularly under recent global financing pressures.

Governments globally may use a variety of measures to control costs, including proposing price reform or legislation, cross country collaboration and procurement, price cuts, mandatory rebates, health technology assessments, forced localization as a condition of market access, “international reference pricing” (i.e., the practice of a country linking its regulated medicine prices to those of other countries), QCE processes and VBP.

Governments globally may use a variety of measures to control costs, including, among others, proposing price reform or legislation, cross country collaboration and procurement, price cuts, mandatory rebates, health technology assessments, forced localization as a condition of market access, “international reference pricing” (i.e., the practice of a country linking its regulated medicine prices to those of other countries), QCE processes and VBP.

In addition, the international patchwork of price regulation, differing economic conditions and incomplete value assessments across countries has led to varying access to quality medicines in many markets and some third-party trade in our products between countries.

Several important multilateral organizations such as the WHO are increasing scrutiny of international pharmaceutical pricing through policy recommendations and sponsorship of programs, such as “The Oslo Medicines Initiative” which is planning a high-level meeting in 2022 to agree on WHO Europe Member States’ commitments to ensure “affordability for high-priced medicines”.

In November 2020, the EC published its new Pharmaceutical Strategy for Europe which envisions a broad range of new initiatives and legislation including a significant focus on affordability and access to medicines.

2021 Form 10-K 11

In China, pricing pressures have increased in recent years because of an overall focus on healthcare cost containment with government officials emphasizing improved health outcomes, healthcare reform and decreased drug prices as key indicators of progress towards reform.

For patented products, drug prices have decreased dramatically as a result of adding innovative drugs (including oncology medicines) to the National Reimbursement Drug List (NRDL).

In the off-patent space, numerous local generics have been officially deemed bioequivalent under a QCE process that required domestically-manufactured generic drugs to pass a test to assess their bioequivalence to a qualified reference drug (typically the originator drug).

A centralized VBP program, a tender process where a certain portion of included molecule volumes are guaranteed to tender winners and is intended to contain healthcare costs by driving utilization of generics that have passed QCE, has resulted in dramatic price cuts for off-patent medicines.

Furthermore, the Chinese government has discussed moving toward efforts to unify the reimbursement price between QCE-approved generic medicines and the applicable original medicines, which the government currently plans to implement within the next few years.

We and most off-patent originators have mostly not been successful in the VBP bidding process.

The government has indicated that additional post-LOE drugs could be subjected to VBP qualification in future rounds.

Several important multilateral organizations such as the World Health Organization are increasing scrutiny of international pharmaceutical pricing through policy recommendations and sponsorship of programs, such as “The Oslo Medicines Initiative” which aims to ensure “affordability for high-priced medicines”.

In November 2020, the EC published its Pharmaceutical Strategy for Europe which envisions a broad range of new initiatives and legislation including a significant focus on tackling the persisting inequalities on access, affordability and availability of medicines across the EU.

In China, pricing pressures have increased in recent years because of an overall focus on healthcare cost containment with the central government emphasizing improved health outcomes and decreased drug prices as key indicators of progress towards its healthcare reform.

For patented products, drug prices have decreased dramatically as a result of adding innovative drugs (including oncology medicines and orphan drugs) to the National Reimbursement Drug List (NRDL) via access-price negotiation.

In the off-patent space, numerous local generics have been officially deemed bioequivalent under a QCE process that required generic drugs to pass a test to assess their bioequivalence to a qualified reference drug (typically the originator drug).

A centralized VBP program—a tendering process where a certain portion of included molecule volumes are guaranteed to tender winners—aims to contain healthcare costs by driving utilization of generics that have passed QCE.

This has resulted in further lowering the price of medicines, especially off-patent medicines;

this trend is expected to continue.

Furthermore, the Chinese government has promulgated price bidding rules in June 2022 for enlisting off-patent products (excluding VBP products and certain products directly priced by government) onto the NRDL with the goal of unifying the reimbursement price between QCE-approved generic medicines and the applicable original medicines.

Pfizer, along with most off-patent originators, have mostly not been successful in the VBP bidding process.

The government has indicated that additional post-LOE drugs (including biological products) could be subjected to VBP qualification in future rounds.

Certain of our products, such as Sulperazon and Vfend injectables, are likely to be included in future rounds.

While certain details of future QCE expansion have been made available, we are unable to determine the impact on our business and financial condition until the initiation of these future rounds.

2022 Form 10-K 11

Healthcare Provider Transparency and Disclosures.

2 unchanged sentences

Reliable patent protection and enforcement around the world are among the key factors we consider for continued business and R&D investment.

The WTO Agreement on Trade Related Aspects of Intellectual Property Rights (WTO-TRIPS) requires participant countries to provide patent and other intellectual property-related protection for pharmaceutical products by law, with an exemption provided for least-developed countries until 2033.

The WTO Agreement on Trade Related Aspects of Intellectual Property Rights (WTO-TRIPS) requires participant countries to provide patent and other intellectual property-related protection for pharmaceutical products by law, with a time-limited exemption provided for least-developed countries.

While some countries have made improvements, we still face patent grant, enforcement and other intellectual property challenges in many countries.

While the global intellectual property policy environment has generally improved following WTO-TRIPS and bilateral/multilateral trade agreements, our growth and ability to bring new product innovation to patients depends on further progress in intellectual property protection.

While the global intellectual property policy environment has generally improved following implementation of WTO-TRIPS and bilateral/multilateral trade agreements, our growth and ability to bring new product innovation to patients depends on further progress in intellectual property protection.

In certain developed international markets, governments maintain relatively effective intellectual property policies.

However, in the EU, pursuant to the ongoing review of pharmaceutical intellectual property and regulatory incentives, legislative change may result in the reduction of certain protections.

However, in the EU, pursuant to the ongoing review of pharmaceutical intellectual property and regulatory incentives, legislative proposals expected to be introduced in 2023 may result in the reduction of certain protections.

In several emerging market countries, governments have used intellectual property policies as a tool to force innovators to accept less than fair value for medicines, as well as to advance industrial policy and localization goals.

Discussions are ongoing at the WTO that seek to limit intellectual property protections within the context of the COVID-19 pandemic response.

The WTO continues to address the role of intellectual property in the context of the COVID-19 pandemic response.

This includes the June 2022 Ministerial Decision on the Agreement on Trade-Related Aspects of Intellectual Property Rights, which seeks to make it easier for certain WTO members to issue a compulsory license on COVID-19 vaccines, and discussions continue on whether to expand that decision to COVID-19 therapeutics and diagnostics.

Considerable political and economic pressure has weakened current intellectual property protection in some countries and has led to policies such as more restrictive standards for obtaining patents and more difficult procedures for patenting biopharmaceutical inventions, restrictions on patenting certain types of inventions, revocation of patents, laws or regulations that promote or provide broad discretion to issue a compulsory license, weak intellectual property enforcement and failure to implement effective regulatory data protection.

3 unchanged sentences

The legislative and regulatory framework for privacy and data protection issues worldwide is also rapidly evolving as countries continue to adopt new and updated privacy and data security laws.

The interpretation and application of such laws and regulations remain uncertain and continue to evolve.

The interpretation and application of such laws and regulations remain uncertain and continues to evolve.

In addition, enforcement of such laws and regulations is increasing.

5 unchanged sentences

$88 million in environment-related capital expenditures and $148 million in other environment-related expenses.

While capital expenditures or operating costs for environmental compliance cannot be predicted with certainty, we do not currently anticipate they will have a material effect on our capital expenditures or competitive position.

What changed 10-K

Item 1. Business