What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-02-22 compared with 2023-02-23 · 438 added, 403 removed, 508 unchanged (62% of the section changed)

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Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K can be found within MD&A in our 2022 Form 10-K.

2022 Form 10-K 25

OVERVIEW OF OUR PERFORMANCE, OPERATING ENVIRONMENT, STRATEGY AND OUTLOOK

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2023 Total Revenues––$58.5 billion 2023 Net Cash Flow from Operations––$8.7 billion

An increase of 23% compared to 2021 A decrease of 10% compared to 2021

A decrease of 42% compared to 2022 A decrease of 70% compared to 2022

2023 Reported Diluted EPS––$0.37 2023 Adjusted Diluted EPS (Non-GAAP)––$1.84*

An increase of 42% compared to 2021 An increase of 62% compared to 2021

A decrease of 93% compared to 2022 A decrease of 72% compared to 2022

* For additional information regarding Adjusted diluted EPS (which is a non-GAAP financial measure), including reconciliations of certain GAAP Reported to non-GAAP Adjusted information, see the Non-GAAP Financial Measure:

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See the Item 1.

Business –– About Pfizer section in this Form 10-K.

Pfizer is committed to working towards equitable and affordable access to our medicines and vaccines for people around the world.

Business ––About Pfizer section.

As a science-driven global biopharmaceutical company, we remain focused on advancing our pipeline, supporting our marketed brands and deploying capital responsibly, with a focus on initiatives that can help contribute to our long-term revenue and future growth.

Our ability to fulfill our purpose, Breakthroughs that change patients’ lives , remains a core focus and underscores our commitment to addressing the needs of society to help sustain long-term value creation for all stakeholders.

Most of our revenues come from the manufacture and sale of biopharmaceutical products.

We believe that our medicines and vaccines provide significant value for healthcare providers and patients and seek to enhance their value by continuously evaluating how we can best collaborate with patients, physicians and payers to support and expand patient access to reliable, affordable healthcare around the world.

In addition, we continually seek to expand and broaden our product portfolio offerings through prioritized development of our pipeline and acquisitions targeted at critical unmet patient needs.

We believe that our medicines and vaccines provide significant value for healthcare providers and patients and continuously evaluate how we can best collaborate with patients, physicians and payors to support and expand patient access to reliable, affordable healthcare around the world.

In addition, we continually seek to expand and broaden our product portfolio offerings through prioritized development of our pipeline and business development opportunities targeted at critical unmet patient needs.

As a result, our commercial organizational structure and R&D operations are critical to the successful execution of our business strategy.

In 2023, we are making additional investments in both R&D and SI&A to support Pfizer’s near- and longer-term growth plans, including to support anticipated new launches, commercial launch of COVID-19 products, potential high-value pipeline programs and recently acquired assets.

With the formation of the Consumer Healthcare JV in 2019, the spin-off of our former Upjohn Business in the fourth quarter of 2020 and the sale of our Meridian subsidiary in the fourth quarter of 2021, Pfizer transformed into a more focused, global leader in science-based innovative medicines and vaccines engaged in the discovery, development, manufacture, marketing, sale and distribution of biopharmaceutical products worldwide.

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

Biopharma and PC1.

Biopharma is the only reportable segment.

See Note 1A and Item 1.

Business––Commercial Operations in this Form 10-K for additional information.

We expect to incur costs of approximately $700 million in connection with separating Upjohn, of which approximately 85% has been incurred since inception and through December 31, 2022.

These charges include costs and expenses related to separation of legal entities and transaction costs.

Beginning in 2019, we took action through our Transforming to a More Focused Company restructuring program to ensure our cost base and support model aligned appropriately with our operating structure.

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, and in the fourth quarter of 2022, we began taking steps to optimize our end-to-end R&D operations to reduce costs and cycle times as well as to further prioritize our internal R&D portfolio in areas where our capabilities are differentiated while increasing external innovation efforts to leverage an expanding and productive biotech sector.

See Note 3 for additional information.

For a description of savings related to this

Our 2024 key priorities are:

• Achieve world-class oncology leadership

• Deliver next wave of pipeline innovation

• Maximize performance of our new products

• Expand margins by realigning our cost base

• Allocate capital to enhance shareholder value

2023 Form 10-K

program, see the Costs and Expenses––Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives section of this MD&A .

In 2023, we managed our commercial operations through a global structure consisting of two operating segments:

Biopharma and Business Innovation.

Biopharma was the only reportable segment.

See Note 1A and the Item 1.

Business––Commercial Operations section.

In December 2023, we completed our acquisition of Seagen.

At the beginning of 2024, we made changes in our commercial organization that went into effect on January 1, 2024 to incorporate Seagen and improve focus, speed and execution.

Specifically, within our Biopharma reportable segment we created:

• the Pfizer Oncology Division, which brings together U.S.

oncology commercial operations from both Pfizer and Seagen and is led by the Chief Oncology Officer, Executive Vice President, who also leads Pfizer’s newly combined global oncology R&D operations;

• the Pfizer U.S.

Commercial Division, which focuses on the commercialization of non-oncology products in the U.S.

and is led by the Chief U.S.

Commercial Officer, Executive Vice President;

• the Pfizer International Commercial Division, which focuses on the commercialization of Pfizer’s entire product portfolio outside the U.S.

and is led by the Chief International Commercial Officer, Executive Vice President.

In the fourth quarter of 2022, we began taking steps through our Transforming to a More Focused Company restructuring program to optimize our end-to-end R&D operations to reduce costs and cycle times as well as to further prioritize our internal R&D portfolio in areas where our capabilities are differentiated while increasing external innovation efforts to leverage an expanding and productive biotech sector.

Beginning in July 2023, in consideration of planned future investments in oncology, including the acquisition of Seagen on December 14, 2023, we reorganized our R&D platform operations.

See Note 17A .

In the fourth quarter of 2023, we announced that we launched a multi-year, enterprise-wide cost realignment program that aims to realign our costs with our longer-term revenue expectations.

For a description of savings related to these programs, see the Costs and Expenses––Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives section within MD&A .

We believe we have a strong pipeline and are well-positioned for future growth.

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.

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 medicines and vaccines that may be the most impactful for patients.

Innovation, drug discovery and development are critical to our success.

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See the Item 1.

Business — Research and Development section in this Form 10-K for our R&D priorities and strategy.

Business — Research and Development section for our R&D priorities and strategy.

We seek to leverage a strong pipeline, organize around expected operational growth drivers and capitalize on trends creating long-term growth opportunities, including:

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We assess our business, assets and scientific capabilities/portfolio as part of our regular, ongoing portfolio review process and also continue to consider business development activities that will help advance our business strategy.

For additional information, including discussion of recent significant business development activities, see Note 2 .

For a discussion of recent significant business development activities, see Note 2 .

Our 2023 Performance

Revenues ––Revenues increased $19.0 billion, or 23%, to $100.3 billion in 2022 from $81.3 billion in 2021, reflecting an operational increase of $24.6 billion, or 30%, as well as an unfavorable impact of foreign exchange of $5.5 billion, or 7%.

The operational increase was primarily driven by growth from Paxlovid and Comirnaty.

Excluding the impact of Paxlovid and Comirnaty, revenues increased 2% operationally, reflecting strong growth in the Prevnar family, Eliquis and the Vyndaqel family, as well as revenue from recently acquired products, Nurtec ODT/Vydura and Oxbryta, partially offset by declines in Xeljanz, Chantix/Champix, Sutent, certain Comirnaty-related manufacturing activities performed on behalf of BioNTech (which are included in the PC1 contract development and manufacturing organization) and Ibrance.

The following outlines the components of the net change in revenues:

As of January 31, 2023, on a total company basis, we forecasted revenues in 2023 of $67 billion to $71 billion, reflecting an operational decline of 31% at the midpoint from 2022 results, which we expect will also have an unfavorable impact on Income from continuing operations before provision/(benefit) for taxes on income .

The total company expected revenue declines in 2023 are driven by an expected reduction in sales of our COVID-19 products, partially offset by expected operational growth from our non-COVID-19 in-line portfolio, anticipated new product launches, and recently acquired products.

See the Revenues by Geography and Revenues –– Selected Product Discussion sections within MD&A for more information, including a discussion of key drivers of our revenue performance.

See also The Global Economic Environment––COVID-19 section below for information about our COVID-19 products, including expectations for 2023.

Total Revenues ––Total revenues decreased $41.8 billion, or 42%, to $58.5 billion in 2023 from $100.3 billion in 2022, reflecting an operational decrease of $40.8 billion, or 41%, as well as an unfavorable impact of foreign exchange of $1.0 billion, or 1%.

The operational decrease was primarily driven by significant declines in revenues from Comirnaty and Paxlovid, including a $3.5 billion non-cash revenue reversal for Paxlovid recorded in the fourth quarter of 2023.

Excluding contributions from Comirnaty and Paxlovid, Total revenues increased 7% operationally, reflecting an increase in revenues from Nurtec ODT/Vydura and Oxbryta;

revenues from Abrysvo, primarily driven by the launch of the older adult indication in the U.S.;

as well as continued growth from the Vyndaqel family and Eliquis;

partially offset by a decline in Ibrance.

The following chart outlines the components of the net change in Total revenues :

See the Total Revenues by Geography and Total Revenues––Selected Product Discussion sections within MD&A for more information, including a discussion of key drivers of our revenue performance.

See also The Global Economic Environment––COVID-19 section below for information about our COVID-19 products.

For information regarding the primary indications or class of certain products, see Note 17C .

Income from Continuing Operations Before Provision/(Benefit) for Taxes on Income –– The increase in Income from continuing operations before provision/(benefit) for taxes on income of $10.4 billion, to $34.7 billion in 2022 from $24.3 billion in 2021, was primarily attributable to higher revenues and lower Acquired in-process research and development expenses , partially offset by (i) an increase in Cost of sales, (ii) net losses on equity securities in 2022 versus net gains on equity securities in 2021, (iii) lower net periodic benefit credits associated with pension and other postretirement plans, and (iv) increases in Research and development expenses, Selling, informational and administrative expenses, and Restructuring charges and certain acquisition-related costs.

See the Analysis of the Consolidated Statements of Income within MD&A and Note 4 for additional information.

See also The Global Economic Environment––COVID-19 section below for information about our COVID-19 products, including expectations for 2023.

For information on our tax provision and effective tax rate, see the Provision/(Benefit) for Taxes on Income section within MD&A and Note 5 .

2023 Form 10-K

While royalty income through December 31, 2023 has been recorded in Other Income/(Deductions)—net , we will begin reporting such royalty income in Total revenues beginning in 2024 and will restate prior periods for consistency with our 2024 presentation.

Additionally, we will no longer record royalties from U.S.

sales of Bavencio, as we have irrevocably chosen to donate the right to such royalties to the American Association for Cancer Research.

Income from Continuing Operations Before Provision/(Benefit) for Taxes on Income –– The decrease in Income from continuing operations before provision/(benefit) for taxes on income of $33.7 billion, to $1.1 billion in 2023 from $34.7 billion in 2022, was primarily attributable to (i) lower revenues, (ii) higher intangible asset impairment charges, and (iii) increases in Restructuring charges and certain acquisition-related costs , Amortization of intangible assets , and Selling, informational and administrative expenses, partially offset by (iv) a decrease in Cost of sales and (v) net gains on equity securities in 2023 versus net losses on equity securities in 2022 .

See the Analysis of the Consolidated Statements of Income section within MD&A and Note 4 .

For information on our tax provision and effective tax rate, see the Provision/(Benefit) for Taxes on Income section within MD&A and Note 5 .

Our Operating Environment ––We, like other businesses in our industry, are subject to certain industry-specific challenges.

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Business––Government Regulation and Price Constraints and Item 1A.

Risk Factors sections in this Form 10-K.

Regulatory Environment––Pipeline Productivity –– Our product lines must be replenished over time to offset revenue losses when products lose exclusivity or market share or to respond to healthcare and innovation trends, as well as to provide for earnings growth.

Risk Factors sections.

As a result, we devote considerable resources to our R&D activities which, while essential to our growth, incorporate a high degree of risk and cost, including whether a particular product candidate or new indication for an in-line product will achieve the desired clinical endpoint or safety profile, will be approved by regulators or will be successful commercially.

Clinical trials are conducted to determine, among other things, whether an investigational drug or device is safe and effective for a particular patient population.

Clinical trials are conducted to determine, among other things, whether an investigational drug, vaccine or device is safe and effective for a particular patient population.

After a product has been approved or authorized and launched, we continue to monitor its safety as long as it is available to patients, including conducting postmarketing trials, voluntarily or pursuant to a regulatory request.

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updating a product’s labeling, restricting its use, communicating new safety information or, in rare cases, seeking to suspend or remove a product from the market.

Intellectual Property Rights and Collaboration/Licensing Rights –– 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.

Intellectual Property Rights and Collaboration/Licensing Rights –– The loss, expiration or invalidation of intellectual property rights, patent litigation settlements and judgments, and the expiration of co-promotion and licensing rights can have a material adverse effect on our revenues.

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.

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For additional information on patent rights we consider most significant to our business as a whole, see the Item 1.

Business––Patents and Other Intellectual Property Rights section in this Form 10-K.

Business––Patents and Other Intellectual Property Rights section.

For a discussion of recent developments with respect to patent litigation, see Note 16A1 .

Regulatory Environment/Pricing and Access––Government and Other Payer Group Pressures –– The pricing of medicines and vaccines by pharmaceutical manufacturers and the cost of healthcare, which includes medicines, vaccines, medical services and hospital services, continues to be important to payers, governments, patients, and other stakeholders.

Federal and state governments and private third-party payers in the U.S.

continue to take action to manage the utilization of drugs and cost of drugs, including increasingly employing formularies to control costs by taking into account discounts in connection with decisions about formulary inclusion or favorable formulary placement.

Regulatory Environment/Pricing and Access––Government and Other Payor Group Pressures –– The pricing of medicines and vaccines by pharmaceutical manufacturers and the cost of healthcare, which includes medicines, vaccines, medical services and hospital services, continues to be important to payors, governments, patients, and other stakeholders.

Federal and state governments and private third-party payors in the U.S.

continue to take action to manage the utilization and cost of drugs, including increasingly employing formularies to control costs and encourage utilization of certain drugs, including through the use of deductibles, utilization management tools, cost sharing or formulary placement.

We consider a number of factors impacting the pricing of our medicines and vaccines.

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for prescribed medicines and vaccines is ultimately set by healthcare providers and insurers.

Governments globally, as well as private third-party payers in the U.S., may use a variety of measures to control costs, including, among others, proposing pricing reform or legislation, employing formularies to control costs, 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, as well as private third-party payors in the U.S., may use a variety of measures to control costs, including, among others, legislative or regulatory pricing reforms, drug formularies (including tiering and utilization management tools), 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.

We anticipate that these and similar initiatives will continue to increase pricing and access pressures globally.

In the U.S., 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, such as the IRA that was signed into law in August 2022.

In the U.S., we expect to see continued focus by Congress and the Biden Administration on regulating pricing.

The drug pricing provisions of the IRA, which was signed into law in August 2022, began to be implemented in 2022 and implementation efforts will continue over the next several years.

In August 2023, the Biden Administration unveiled the first ten medicines subject to the “Medicare Drug Price Negotiation Program,” which requires manufacturers of select drugs to engage in a process with the federal government to set new Medicare prices which would go into effect in 2026.

Among the first ten medicines subject to the Program included Eliquis.

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, including legal or legislative developments at the federal or state level with respect to the 340B program, could have a material impact on our business.

For additional information, see the Item 1.

In addition, changes to the Medicaid Drug Rebate program or the 340B Program, including legal or legislative developments at the federal or state level with respect to the 340B program, could have a material impact on our business.

See the Item 1.

Business –– Pricing Pressures and Managed Care Organizations and ––Government Regulation and Price Constraints and the Item 1A.

Risk Factors –– Pricing and Reimbursement sections in this Form 10-K.

Product Supply –– We periodically encounter supply delays, disruptions and shortages, including due to voluntary product recalls.

In response to requests from various regulatory authorities, manufacturers across the pharmaceutical industry, including Pfizer, are evaluating their product portfolios for the potential presence or formation of nitrosamines.

This has led to recalls, including our voluntary recall of Chantix in 2021 and additional voluntary recalls initiated for other products in 2022 due to the presence of nitrosamines above the FDA interim acceptable intake limit, and may lead to additional recalls or other market actions for Pfizer products.

Regarding our supply chain generally, in 2022 and to date, we have not seen a significant disruption, and all of our manufacturing sites globally have continued to operate at or near normal levels;

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 business.

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.

Risk Factors –– Pricing and Reimbursement sections.

Impact of the July 2023 Tornado in Rocky Mount, North Carolina (NC) –– Our manufacturing facility in Rocky Mount, NC was damaged by a tornado in July 2023.

The facility is a key producer of sterile injectables and is responsible for manufacturing nearly 25 percent of all our sterile injectables—including anesthesia, analgesia, and micronutrients—which is nearly eight percent of all the sterile injectables used in U.S.

While manufacturing has resumed, the supply of medicines impacted by the tornado is expected to be affected through 2024.

In 2023, we recorded $286 million to Cost of sales for inventory losses, overhead costs related to the period in which the facility could not operate, and incremental costs resulting from the tornado damage.

Losses incurred in 2023 were partially offset by insurance recoveries received in the fourth quarter of 2023.

We may record additional losses and/or costs and/or insurance recoveries in future periods, but we are unable to predict them with certainty at this time.

2023 Form 10-K

Product Supply –– We periodically encounter supply delays, disruptions and shortages, including due to voluntary product recalls and natural or man-made disasters.

In 2021, Pfizer recalled all lots of Chantix in the U.S.

due to the presence of a nitrosamine, N-nitroso-varenicline, at or above the FDA interim acceptable intake limit.

Regulatory authorities outside the U.S.

have issued updated guidance on nitrosamine acceptable intake levels.

With this recently issued guidance, which included an updated intake level for N-nitroso-varenicline, we expect to make regulatory submissions in 2024 to potentially enable Chantix to return to market outside the U.S., and our related discussions with FDA are ongoing.

Except for the tornado in Rocky Mount, NC discussed above, we have not seen a significant disruption of our supply chain in 2023 and through the date of filing of this Form 10-K, and all of our manufacturing sites globally have continued to operate at or near normal levels;

however, we continue to see heightened 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 business.

We continue 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.

For information on risks related to product manufacturing, see the Item 1A.

Risk Factors––Product Manufacturing, Sales and Marketing Risks section in this Form 10-K.

Risk Factors––Product Manufacturing, Sales and Marketing Risks section.

The Global Economic Environment ––In addition to the industry-specific factors discussed above, we, like other businesses of our size and global extent of activities, are exposed to economic cycles.

Certain factors in the global economic environment that may impact our global operations include, among other things, currency fluctuations, capital and exchange controls, local and global economic conditions including inflation, recession, volatility and/or lack of liquidity in capital markets, expropriation and other restrictive government actions, changes in intellectual property, legal protections and remedies, trade regulations, tax laws and regulations and procedures and actions affecting approval, production, pricing, and marketing of, reimbursement for and access to our products, as well as impacts of political or civil unrest or military action, including the ongoing conflict between Russia and Ukraine and its economic consequences, geopolitical instability, terrorist activity, unstable governments and legal systems, inter-governmental disputes, public health outbreaks, epidemics, pandemics, natural disasters or disruptions related to climate change.

Certain factors in the global economic environment that may impact our global operations include, among other things, currency and interest rate fluctuations, capital and exchange controls, local and global economic conditions including inflation, recession, volatility and/or lack of liquidity in capital markets, expropriation and other restrictive government actions, changes in intellectual property, legal protections and remedies, trade regulations, tax laws and regulations and procedures and actions affecting approval, production, pricing, and marketing of, reimbursement for and access to our products, as well as impacts of political or civil unrest or military action, including the ongoing conflicts between Russia and Ukraine and in the Middle East and their economic consequences, geopolitical instability, terrorist activity, unstable governments and legal systems, inter-governmental disputes, public health outbreaks, epidemics, pandemics, natural disasters or disruptions related to climate change.

Government pressures can lead to negative pricing pressure in various markets where governments take an active role in setting prices, access criteria or other means of cost control.

For additional information on risks related to our global operations, see the Item 1A.

Risk Factors — Global Operations section in this Form 10-K.

COVID-19 ––In response to COVID-19, we have developed Paxlovid and collaborated with BioNTech to jointly develop Comirnaty, including booster doses of an Omicron-adapted bivalent vaccine.

As part of our strategy for COVID-19, we are continuing to make significant additional

2022 Form 10-K 28

investments in breakthrough science and global manufacturing.

This includes continuing to evaluate Comirnaty and Paxlovid, including against new variants of concern, developing monovalent, bivalent and variant adapted vaccine candidates and booster doses and developing potential combination respiratory vaccines and potential next generation vaccines and therapies.

Risk Factors—Global Operations section.

COVID-19 ––In response to COVID-19, we developed Paxlovid and collaborated with BioNTech to jointly develop Comirnaty, including an Omicron XBB.1.5-adapted monovalent vaccine.

As part of our strategy for COVID-19, we are continuing to make significant investments in breakthrough science and global manufacturing.

This includes continuing to evaluate Comirnaty and Paxlovid, including against new variants of concern, developing variant adapted vaccine candidates and developing potential combination respiratory vaccines and potential next generation vaccines and therapies.

We are also evaluating Paxlovid for additional populations.

For additional information, including our continuing late-stage development efforts for Paxlovid, see the Product Developments section within MD&A.

In 2022 and to date, we principally sold Comirnaty and Paxlovid globally under government contracts.

We expect sales of Comirnaty in the U.S.

will transition to traditional commercial market sales in the second half of 2023, triggered by the expiration of current contracts and the vaccines purchased through them becoming either depleted or not usable against new variants.

Internationally, we expect sales of Comirnaty in international developed markets to generally be under government contracts in 2023, and in emerging markets, under a combination of private channels and government contracts;

in both cases, we expect to generally transition to commercial markets starting in 2024.

For Paxlovid, we expect 2023 to be a transitional year as we expect to start selling Paxlovid through the commercial channels in the second half of 2023 rather than significant government purchases.

We also remain committed to helping ensure broad and equitable access to our COVID-19 products to eligible patients around the world.

Revenues from our COVID-19 products are expected to go from their peak in 2022 to their low point in 2023 before potentially returning to growth in 2024.

While patient demand for our COVID-19 products is expected to remain strong throughout 2023, much of that demand is expected to be fulfilled by existing supply of products that were delivered to governments and recorded as revenues in 2022.

As of January 31, 2023, we forecasted Comirnaty revenues of approximately $13.5 billion in 2023, down 64% from actual 2022 results, with gross profit to be split evenly with BioNTech, and Paxlovid revenues of approximately $8 billion in 2023, down 58% from actual 2022 results.

Guidance for both products includes, among other things, anticipated sales through traditional commercial markets in the U.S.

in the second half of 2023 and assumes prior absorption of existing government supply from advanced purchase agreements from 2022.

These forecasts are based on estimates and assumptions that are subject to significant uncertainties, including, among others, patient demand which could be significantly impacted by the infectiousness and severity of the predominant strains of the SAR-CoV-2 virus during 2023, proportion of the population that receives a vaccine or is treated with an oral antiviral treatment, the number of doses per vaccinated person per year, number of symptomatic infections, market share of Comirnaty and Paxlovid, timing and terms for delivery of the contracted doses of Comirnaty to the EC, Paxlovid sales to China and the timing for transitioning Comirnaty and Paxlovid sales to the commercial market in the U.S.

In addition to our introduction of Comirnaty and Paxlovid, COVID-19 has impacted our business, operations and financial condition and results.

For example, COVID-19 had varying impacts on patient visits, vaccinations, elective surgeries, cancer screenings and routine testing, which affected prescriptions or refills of existing prescriptions and demand for products used in procedures.

As part of our on-going monitoring and assessment, we have made certain assumptions regarding COVID-19 for purposes of our operational planning and financial projections, including assumptions regarding the global macroeconomic impact of COVID-19, as well as the demand, revenues, supply, contracts and commercial markets for our COVID-19 products, which remain dynamic.

Despite careful tracking and planning, we are unable to accurately predict the extent of the impact of COVID-19 on our business, operations and financial condition and results due to the uncertainty of future developments.

We will continue to pursue efforts to maintain the continuity of our operations while monitoring for new developments related to COVID-19.

Future developments could result in additional favorable or unfavorable impacts on our business, operations or financial condition and results.

For information on risks associated with COVID-19 and our COVID-19 products, as well as COVID-19 intellectual property disputes, see the Item 1A.

Risk Factors — COVID-19 , — I ntellectual Property Protection and –– Third-Party Intellectual Property Claims sections in this Form 10-K and Note 16A1 .

Russia/Ukraine Conflict ––Our global operations may be impacted by the armed conflict between Russia and Ukraine.

Consistent with our commitment to putting patients first, we are maintaining the supply of medicines to Russia, including the provision of needed medicines to patients already enrolled in clinical trials.

Effective March 14, 2022, Pfizer began donating profits of our Russian subsidiary to causes that provide direct humanitarian support to the people of Ukraine, in addition to our ongoing efforts to support the humanitarian response in the region.

In 2022, we have donated approximately $25 million to support humanitarian relief and response efforts.

We will continue to support Ukrainian relief efforts through this method until peace is achieved.

Additionally, we are not initiating new clinical trials in Russia, have stopped recruiting new patients in our ongoing clinical trials in the country, and halted all new investments with local suppliers intended to build manufacturing capacity in Russia.

For the years ended December 31, 2022 and 2021, the business of our Russia and Ukraine subsidiaries represented less than 1% of our consolidated revenues and assets, and while we are monitoring the effects of the armed conflict between Russia and Ukraine, the situation continues to evolve and the long-term implications, including the broader economic consequences of the conflict, are difficult to predict at this time.

While as of now, we do not anticipate any significant negative impacts on our business from this conflict, continued regional instability, geopolitical shifts, potential additional sanctions and other restrictive measures against Russia, neighboring countries or allies of Russia, any retaliatory measures taken by Russia, neighboring countries or allies of Russia, and actions by our customers or suppliers in response to such measures could adversely affect the global macroeconomic environment, our operations, currency exchange rates and financial markets, which could in turn adversely impact our business and results of operations.

See the Product Developments section within MD&A.

In 2023, we principally sold Comirnaty globally under government contracts.

In September 2023, Comirnaty transitioned to traditional commercial market sales in the U.S., triggered by the expiration of current contracts and the COVID-19 vaccines from Pfizer and BioNTech purchased through them becoming either depleted or not used following the introduction of a new variant vaccine.

Internationally, sales of Comirnaty in international developed markets were generally under government contracts in 2023, and in emerging markets, under a combination of private channels and government contracts;

in both cases, we expect to start transitioning to commercial markets in 2024.

Due to the commercial market transition as well as the anticipated seasonal nature of COVID vaccination, we expect more than 80% of our 2024 global revenues for Comirnaty to be recorded in the second half of the year.

In 2023, we principally sold Paxlovid globally to government agencies.

Internationally, for Paxlovid, we are continuing the transition to commercial markets and are expecting most revenue for Paxlovid to be generated through commercial channels in 2024.

On October 13, 2023, we announced an amended agreement with the U.S.

government, which facilitated the transition of Paxlovid to traditional commercial markets in November 2023, with minimal uptake of NDA-labeled commercial product before January 1, 2024.

See Note 17C .

For information on risks associated with our COVID-19 products, including certain assumptions made for purposes of our operational planning and financial projections and the uncertainty of future developments, as well as COVID-19 intellectual property disputes, see the Item 1A.

Risk Factors — COVID-19 , — Intellectual Property Protection and –– Third-Party Intellectual Property Claims sections and Note 16A1 .

Israel/Hamas Conflict ––Our local operations have been impacted by the armed conflict between Israel and Hamas that began on October 7, 2023.

For the years ended December 31, 2023 and 2022, the business of our Israeli subsidiary represented less than 1% of our consolidated revenues and assets.

We are closely monitoring developments in this conflict, including evaluating potential impacts to our business, customers, suppliers, employees, and operations in Israel and elsewhere in the Middle East that may impact global operations.

At this time, longer term impacts to the Company are uncertain and subject to change.

Russia/Ukraine Conflict ––Our local operations have been impacted by the armed conflict between Russia and Ukraine.

For the years ended December 31, 2023 and 2022, the business of our Russia and Ukraine subsidiaries represented less than 1% of our consolidated revenues and assets, and while we are monitoring the effects of the conflict between Russia and Ukraine, the situation continues to evolve and the long-term implications, including the broader economic consequences of the conflict, are difficult to predict at this time.

While as of now, we do not anticipate any significant negative impacts on our global operations from this conflict, continued regional instability, geopolitical shifts, potential additional sanctions and other restrictive measures against Russia, neighboring countries or allies of Russia, any retaliatory measures taken by Russia, neighboring countries or allies of Russia, and actions by our customers or suppliers, including financial institutions, in response to such measures could adversely affect the global macroeconomic environment, our operations, currency exchange rates and financial markets, which could in turn adversely impact our business and results of operations.

SIGNIFICANT ACCOUNTING POLICIES AND APPLICATION OF CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS

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and Legal and Environmental Contingencies ( Note 1S ).

For a discussion of a recently adopted accounting standard, see Note 1B .

For a discussion of recently adopted accounting standards, see Note 1B .

2023 Form 10-K

We account for acquired businesses using the acquisition method of accounting, which requires, among other things, that most assets acquired and liabilities assumed be recognized at their estimated fair value as of the acquisition date.

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Historically, intangible assets have been the most significant fair values within our business combinations.

We utilize an income approach to estimate the acquisition date fair value of intangible assets.

2022 Form 10-K 29

the more significant estimates and assumptions inherent in this approach include the amount and timing of projected net cash flows, the discount rate and the tax rate.

We utilize an income approach to estimate the acquisition date fair value of each identifiable intangible asset.

Some of the more significant estimates and assumptions inherent in this approach include the amount and timing of projected net cash flows, the discount rate, the tax rate, and, for IPR&D assets, the probability of technical and regulatory success (PTRS).

All of these judgments and estimates can materially impact our results of operations.

For further information on our process to estimate the fair value of intangible assets, see Asset Impairments below.

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Some of the more significant estimates and assumptions inherent in the estimate of the fair value of inventory include stage of completion, costs to complete, costs to dispose and selling price.

We estimate the fair value of acquired PP&E using a combination of the cost and market approaches.

Some of the more significant estimates and assumptions inherent in these approaches are the values of asset replacement costs, comparable assets and estimated remaining economic lives of the assets.

For the provisional amounts recognized for the Seagen assets acquired and liabilities assumed as of the acquisition date, see Note 2A .

The estimated values are not yet finalized and are subject to change, which could be significant.

We will finalize the amounts recognized as we obtain the information necessary to complete the analyses.

We expect to finalize the amounts of assets acquired and liabilities assumed as soon as possible but no later than one year from the acquisition date.

Our gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized.

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Rebate accruals are product specific and, therefore for any period, are impacted by the mix of products sold as well as the forecasted channel mix for each individual product.

For further information, see the Revenue Deductions section within MD&A and Note 1 G .

For further information, see the Product Revenue Deductions section within MD&A and Note 1G .

Asset Impairments

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This could result, for example, from a change in a government reimbursement program that results in an inability to sustain projected product revenues and profitability.

This also could result from the introduction of a competitor’s product that impacts projected revenue growth, as well as the lack of acceptance of a product by patients, physicians and payers.

This also could result from the introduction of a competitor’s product that impacts projected revenue growth, as well as the lack of acceptance of a product by patients, physicians and payors.

For IPR&D projects, this could result from, among other things, a change in outlook based on clinical trial data, a delay in the projected launch date or additional expenditures to commercialize the product.

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As such, immediately after acquisition or impairment, even small declines in the outlook for these assets can negatively impact our ability to recover the carrying value and can result in an impairment charge.

2023 Form 10-K

Goodwill ––Our goodwill impairment review work as of December 31, 2023 concluded that none of our goodwill was impaired and we do not believe the risk of impairment is significant at this time, as the fair value of each of our reporting units is significantly higher than their respective net book values.

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and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.

2022 Form 10-K 30

For all of our reporting units, there are a number of future events and factors that may impact future results and that could potentially have an impact on the outcome of subsequent goodwill impairment testing.

For a list of these factors, see the Forward-Looking Information and Factors That May Affect Future Result s and the Item 1A.

Risk Factors sections in this Form 10-K.

Risk Factors sections.

Benefit Plans

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plans and international plans is applied to the fair value of plan assets at each year-end and the resulting amount is reflected in our net periodic benefit costs in the following year.

Differences between the actual rate of return on plan assets and the expected annual rate of return on plan assets are immediately recognized through earnings upon remeasurement.

The following illustrates the sensitivity of net periodic benefit costs to a 50 basis point decline in our assumption for the expected annual rate of return on plan assets, holding all other assumptions constant (in millions, pre-tax):

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Benefit Costs

Expected annual rate of return on plan assets 50 basis point decline $92

The actual return on plan assets resulted in a net loss on our plan assets of approximately $6.3 billion during 2022 .

Expected annual rate of return on plan assets (a)

50 basis point decline $84

(a) The estimate excludes any potential mark-to-market adjustments.

The actual return on plan assets resulted in a net gain on our plan assets of approximately $835 million during 2023 .

Discount Rate Used to Measure Plan Obligations ––The weighted-average discount rate used to measure the plan obligations for our U.S.

defined benefit plans is determined at least annually and evaluated and modified, as required, to reflect the prevailing market rate of a portfolio of high-quality fixed income investments, rated AA/Aa or better, that reflect the rates at which the pension benefits could be effectively settled.

The discount rate used to measure the plan obligations for our international plans is determined at least annually by reference to investment grade corporate bonds, rated AA/Aa or better, including, when there is sufficient data, a yield-curve approach.

The discount rate used to measure the plan obligations for our significant international plans is determined at least annually by reference to investment grade corporate bonds, rated AA/Aa or better, including, when there is sufficient data, a yield-curve approach.

These discount rate determinations are made in consideration of local requirements.

The measurement of the plan obligations at the end of the year will affect the amount of service cost, interest cost and amortization expense reflected in our net periodic benefit costs in the following year.

The measurement of plan obligations at the end of the year will affect (i) the actuarial (gains)/losses recognized in our net periodic benefit cost for that year and (ii) the amount of service cost and interest cost reflected in our net periodic benefit costs in the following year.

2023 Form 10-K

The following illustrates the sensitivity of net periodic benefit costs and benefit obligations to a 10 basis point decline in our assumption for the discount rate, holding all other assumptions constant (in millions, pre-tax):

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Discount rate 10 basis point decline $5 $210

The change in the discount rates used in measuring our plan obligations as of December 31, 2022 resulted in a decrease in the measurement of our aggregate plan obligations by approximately $6.6 billion.

The change in the discount rates used in measuring our plan obligations as of December 31, 2023 resulted in a decrease in the measurement of our aggregate plan obligations by approximately $616 million.

Income Tax Assets and Liabilities

Income tax assets and liabilities include income tax valuation allowances and accruals for uncertain tax positions.

For additional information, see Notes 1Q and 5 , as well as the Analysis of Financial Condition, Liquidity, Capital Resources and Market Risk section within MD&A .

See Notes 1Q and 5 , as well as the Analysis of Financial Condition, Liquidity, Capital Resources and Market Risk section within MD&A .

Contingencies

We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business, including tax, legal contingencies and guarantees and indemnifications.

For additional information, see Notes 1Q , 1S , 5D and 16 .

2022 Form 10-K 31

We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business, including tax and legal contingencies, guarantees and indemnifications.

See Notes 1Q , 1S , 5D and 16 .

ANALYSIS OF THE CONSOLIDATED STATEMENTS OF INCOME

Revenues by Geography

The following presents worldwide revenues by geography:

Total Revenues by Geography

The following presents worldwide Total revenues by geography:

Year Ended December 31, % Change

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$ 57,186 $ 98,988 $ 79,557 $ 26,698 $ 42,083 $ 29,221 $ 30,488 $ 56,905 $ 50,336 (42) 24 (37) 44 (46) 13

Pfizer CentreOne 1,342 1,731 926 390 524 400 952 1,206 526 (22) 87 (26) 31 (21) 129

Business Innovation

1,310 1,342 1,731 390 390 524 920 952 1,206 (2) (22) — (26) (3) (21)

Total revenues $ 58,496 $ 100,330 $ 81,288 $ 27,088 $ 42,473 $ 29,746 $ 31,408 $ 57,857 $ 51,542 (42) 23 (36) 43 (46) 12

The following provides an analysis of the change in worldwide revenues by geographic areas from 2021 to 2022 (a) :

The following provides an analysis of the worldwide change in Total revenues by geographic areas from 2022 to 2023:

(MILLIONS) Worldwide U.S.

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Operational growth/(decline):

Worldwide growth from Paxlovid, Comirnaty, the Prevnar family, Eliquis, the Vyndaqel family, Inlyta and Xtandi, partially offset by worldwide declines from Xeljanz and Ibrance (b)

Worldwide declines from Comirnaty

$ (26,423) $ (6,370) $ (20,053)

Revenues from recently acquired products:

Nurtec ODT/Vydura and Oxbryta 285 283 2

Decline from PC1 (b)

Worldwide declines from Paxlovid

(17,506) (11,803) (5,703)

Lower revenues for Chantix/Champix and Sutent:

• The decrease in Chantix/Champix was driven by the ongoing global pause in shipments of Chantix due to the presence of N-nitroso-varenicline above an acceptable level of intake set by various global regulators, the ultimate timing for resolution of which may vary by country

• The decrease for Sutent primarily reflects lower volume demand in Europe and the U.S.

following its loss of exclusivity in January 2022 and August 2021, respectively

Worldwide growth from the Vyndaqel family, Eliquis, the Prevnar family and Inlyta, partially offset by worldwide declines from Ibrance, Xeljanz and Xtandi

1,016 1,018 (2)

Increase in revenues from Nurtec ODT/Vydura and Oxbryta, which were acquired in the fourth quarter of 2022

Revenues from Abrysvo, primarily driven by launch of the older adult indication in the U.S.

Revenues from legacy Seagen products subsequent to the acquisition on December 14, 2023

Other operational factors, net 120 (185) 305

Operational growth, net 24,569 12,727 11,842

Operational growth/(decline), net

(40,812) (15,385) (25,428)

Unfavorable impact of foreign exchange (1,022) — (1,022)

Revenues increase/(decrease)

Total revenues increase/(decrease)

$ (41,834) $ (15,385) $ (26,449)

(a) For an analysis of the change in worldwide revenues by geographic area from 2020 to 2021, see the Revenues by Geography section within MD&A in our 2021 Form 10-K.

(b) See the Revenues––Selected Product Discussion within MD&A for additional analysis.

Emerging markets revenues decreased $604 million, or 3%, in 2022 to $20.1 billion from $20.7 billion in 2021, reflecting an operational increase of $366 million, or 2%, and an unfavorable impact from foreign exchange of approximately 5%.

The operational increase in emerging markets revenues was primarily driven by growth from Paxlovid, Sulperazon and Nimenrix, partially offset by declines in Comirnaty and certain Comirnaty-related manufacturing activities performed on behalf of BioNTech.

For an analysis of the change in emerging market revenues from 2020 to 2021, see the Revenues by Geography section within MD&A in our 2021 Form 10-K.

Revenue Deductions –– Our gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized.

These deductions represent estimates of the related obligations and, as such, knowledge and judgment are required when estimating the impact of these revenue deductions on gross sales for a reporting period.

Emerging markets revenues decreased $8.1 billion, or 40%, in 2023 to $12.0 billion from $20.1 billion in 2022, reflecting an operational decrease of $7.4 billion, or 37%, and an unfavorable impact from foreign exchange of 3%.

The operational decrease in emerging markets revenues was primarily driven by declines from Comirnaty and Paxlovid, partially offset by growth from Lorbrena, Zavicefta and Eliquis.

See the Total R evenues––Selected Product Discussion section within MD&A for additional analysis.

Product Revenue Deductions –– Our gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized.

These deductions represent estimates of the related obligations and, as such, knowledge and judgment are required when estimating the impact of these product revenue deductions on gross sales for a reporting period.

Historically, adjustments to these estimates to reflect actual results or updated expectations, have not been material to our overall business and generally have been less than 1% of revenues.

Product-specific rebates, however, can have a significant impact on year-over-year individual product revenue growth trends.

The following presents information about revenue deductions:

2023 Form 10-K

The following presents information about product revenue deductions:

Year Ended December 31,

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Sales allowances 6,790 5,460 4,809

Sales returns and cash discounts 1,290 1,054 924

Sales returns and cash discounts (a)

5,619 1,290 1,054

Total $ 30,048 $ 19,697 $ 17,178

Revenue deductions are primarily a function of product sales volume, mix of products sold, contractual or legislative discounts and rebates.

For information on our accruals for revenue deductions, including the balance sheet classification of these accruals, see Note 1G .

(a) The increase in sales returns and cash discounts in 2023 was primarily due to the revenue reversal of $3.5 billion in the fourth quarter of 2023, related to the expected return of an estimated 6.5 million treatment courses of EUA-labeled U.S.

government Paxlovid inventory (see Note 17C ).

Product revenue deductions are primarily a function of product sales volume, mix of products sold, contractual or legislative discounts and rebates.

For information on our accruals for product revenue deductions, including the balance sheet classification of these accruals, see Note 1G .

2023 Form 10-K

Revenues—Selected Product Discussion

Total Revenues—Selected Product Discussion

(MILLIONS) Year Ended Dec.

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(operationally)

$ 8,775 $ 7,809 12 Performance was largely driven by:

• operational growth in international markets, led by deliveries to certain international developed markets, as well as government purchasing of bivalent boosters in the fourth quarter of 2022 in support of fall vaccination campaigns;

• growth in the U.S.

primarily driven by favorable pricing, partially offset by government purchasing patterns.

This growth was partially offset by lower demand in emerging markets.

$ 2,404 $ 8,775 (73) Declines largely driven by lower contracted deliveries and demand in international markets and lower U.S.

government contracted deliveries, due to transition to new variant vaccines in most markets and the transition to traditional U.S.

commercial market sales which began in September 2023.

8,816 29,032 (70) (69)

Worldwide $ 11,220 $ 37,806 (70) (70)

Paxlovid $18,933

$ 10,514 $ 76 * Driven by the U.S.

launch under EUA in December 2021 and international launches in late 2021 and early 2022 following regulatory approvals or EUAs.

Worldwide $ 18,933 $ 76 * *

Eliquis $6,747

(operationally)

$ 3,822 $ 3,160 21 Growth driven primarily by continued oral anti-coagulant adoption and market share gains in non-valvular atrial fibrillation in the U.S.

and certain markets in Europe, as well as favorable changes in channel mix in the U.S., partially offset by the non-recurrence of an $80 million favorable adjustment related to the Medicare “coverage gap” provision recorded in the first quarter of 2021 in the U.S., as well as declines in certain emerging markets.

$ 4,228 $ 3,822 11 Growth driven primarily by continued oral anti-coagulant adoption and market share gains in the non-valvular atrial fibrillation indication in the U.S.

and certain markets in Europe, partially offset by declines due to LOE and generic competition in certain international markets.

2,519 2,658 (5) (3)

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$ 4,204 $ 4,032 4 Growth primarily driven by the adult indications in the U.S.

due to strong patient demand following the launch of Prevnar 20 for the eligible adult population, partially offset by a reduction in revenues due to a one-time CDC inventory return program for the pediatric indication, the revenue impact of which is expected to be reversed in 2023 upon replenishment, as well as unfavorable timing of purchases for the adult indication internationally.

due to strong patient demand for Prevnar 20 for the eligible adult population, partially offset by the Prevnar pediatric indication in the U.S.

driven by lower market share due to competitor entry.

2,236 2,305 (3) —

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(operationally)

$ 3,370 $ 3,418 (1) Global declines primarily driven by prior-year clinical trial purchases internationally, planned price decreases that recently went into effect in international developed markets, and continued increase in the proportion of patients accessing Ibrance through the U.S.

Patient Assistance Program, partially offset by higher volumes across multiple regions.

$ 3,151 $ 3,370 (6) Declines primarily driven by lower demand globally due to competitive pressure, lower clinical trial purchases internationally, and planned price decreases in certain international developed markets.

1,602 1,751 (8) (6)

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(operationally)

$ 1,245 $ 909 37 Growth largely driven by continued strong uptake of the ATTR-CM indication, primarily in developed Europe and the U.S., partially offset by a planned price decrease that went into effect in Japan in the second quarter of 2022.

$ 1,863 $ 1,245 50 Growth largely driven by continued strong uptake of the ATTR-CM indication, primarily in the U.S.

and developed Europe, partially offset by a planned price decrease that went into effect in Japan in the second quarter of 2022.

1,458 1,202 21 22

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(operationally)

$ 1,129 $ 1,647 (31) Global declines driven primarily by decreased prescription volumes globally resulting from ongoing shifts in prescribing patterns related to label changes, as well as declines in net price due to unfavorable changes in channel mix in the U.S.

$ 1,154 $ 1,129 2 Decline driven primarily by decreased prescription volumes globally resulting from ongoing shifts in prescribing patterns related to label changes, partially offset by higher net price in the U.S.

due to favorable changes in channel mix.

549 668 (18) (15)

Worldwide $ 1,703 $ 1,796 (5) (4)

Paxlovid $1,279

(operationally)

$ (1,289) $ 10,514 * Declines primarily driven by:

• a non-cash revenue reversal of $3.5 billion recorded in the fourth quarter of 2023, of which a portion was associated with sales recorded in 2022, related to the expected return of an estimated 6.5 million treatment courses of EUA-labeled U.S.

government inventory (see Note 17C );

• lower contractual deliveries in most international markets,

partially offset by:

• strong demand in China under the temporary National Reimbursement Drug List (which ended on April 1, 2023) due to surge in COVID-19 infection during the first quarter of 2023;

• fourth quarter sales under traditional commercial markets following transition, primarily in the U.S.

2,568 8,419 (69) (68)

Worldwide $ 1,279 $ 18,933 (93) (92)

Xtandi $1,191

(operationally)

$ 1,198 $ 1,185 1 Performance largely due to steady demand growth across the mCRPC, nmCRPC, and mCSPC indications, slightly offset by unfavorable changes in channel mix and fluctuating enrollment rates in the Xtandi Patient Assistance Program.

$ 1,191 $ 1,198 (1) Decline driven by lower net price mainly due to unfavorable changes in channel mix, partially offset by higher demand.

Worldwide $ 1,191 $ 1,198 (1) (1)

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(operationally)

$ 618 $ 599 3 Growth primarily reflects continued strong performance in emerging markets and the U.S.

driven by the adoption of combinations of certain immune checkpoint inhibitors and Inlyta for the first-line treatment of patients with advanced RCC.

385 403 (5) 5

$ 642 $ 618 4 Growth primarily reflects continued growth in emerging markets and the U.S.

driven by the adoption of combinations of certain immune checkpoint inhibitors and Inlyta for the first-line treatment of patients with advanced RCC, partially offset by lower volumes and lower net price in certain European markets.

Worldwide $ 1,036 $ 1,003 3 5

Pfizer CentreOne

Nurtec ODT/Vydura $928

$ 908 $ 211 * Growth primarily driven by timing of the acquisition of Biohaven (fourth quarter of 2022) as well as strong patient demand in the U.S.

See Note 2A .

Worldwide $ 928 $ 213 * *

2023 Form 10-K

Business Innovation

(MILLIONS) Year Ended Dec.

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Operational Results Commentary

Business Innovation

(operationally)

$ 390 $ 524 (26) Declines primarily driven by lower COVID-19 manufacturing activities performed on behalf of customers, including Comirnaty supply to BioNTech, and lower manufacturing of divested products under manufacturing and supply agreements.

$ 390 $ 390 — Decline primarily driven by a reduction in Comirnaty supply to BioNTech and lower revenues from our active pharmaceutical ingredient sales operation, partially offset by higher manufacturing activities performed on behalf of customers as well as an increase in R&D services to select innovative biotech companies under our Pfizer Ignite operations.

920 952 (3) (3)

Worldwide $ 1,310 $ 1,342 (2) (2)

2022 Form 10-K 33

(a) Comirnaty includes direct sales and Alliance revenues related to sales of the Pfizer-BioNTech COVID-19 vaccine, which are recorded within our Primary Care customer group.

It does not include revenues for certain Comirnaty-related manufacturing activities performed on behalf of BioNTech, which are included in PC1.

It does not include revenues for certain Comirnaty-related manufacturing activities performed on behalf of BioNTech, which are included in PC1, which is part of the Business Innovation operating segment.

See Note 17C .

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See the Item 1.

Business — Patents and Other Intellectual Property Rights section in this Form 10-K for information regarding the expiration of various patent rights, Note 16 for a discussion of recent developments concerning patent and product litigation relating to certain of the products discussed above and Note 17 C for additional information regarding the primary indications or class of the selected products discussed above.

Business — Patents and Other Intellectual Property Rights section for information regarding the expiration of various patent rights, Note 16 for a discussion of recent developments concerning patent and product litigation relating to certain of the products discussed above and Note 17C for the primary indications or class of the selected products discussed above.

Costs and Expenses

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(MILLIONS) 2023 2022 2021 23/22 22/21

Cost of sales (a)

Cost of sales

$ 24,954 $ 34,344 $ 30,821 (27) 11

Percentage of Revenues

Percentage of Total revenues

42.7 % 34.2 % 37.9 %

Selling, informational and administrative expenses (a)

Selling, informational and administrative expenses

14,771 13,677 12,703 8 8

Research and development expenses

10,679 11,428 10,360 (7) 10

Acquired in-process research and development expenses

Amortization of intangible assets (a)

194 953 3,469 (80) (73)

Amortization of intangible assets

4,733 3,609 3,700 31 (2)

Restructuring charges and certain acquisition-related

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* Indicates calculation not meaningful.

(a) For a discussion of the drivers of change for 2021 v.

2020, see the Costs and Expenses section within MD&A in our 2021 Form 10-K.

(a) Beginning in 2024, we will include royalty income in Total revenues and will restate prior periods for consistency with our 2024 presentation.

Cost of Sales

Cost of sales increased $3.5 billion, primarily due to:

• an unfavorable impact of $4.0 billion due to increased sales of Comirnaty, which includes a charge for the 50% gross profit split with BioNTech and applicable royalty expenses;

• inventory write-offs and other charges related to Paxlovid and Comirnaty of $1.1 billion and $600 million, respectively;

• an increase of $1.3 billion due to increased sales of Paxlovid,

Cost of sales decreased $9.4 billion, primarily due to:

• a reduction of $14.2 billion due to lower sales of Comirnaty;

• a reduction of $1.5 billion due to lower sales of Paxlovid,

partially offset by:

• a $3.3 billion favorable impact of foreign exchange and hedging activity.

The decrease in Cost of sales as a percentage of revenues was primarily due to the favorable impacts of Paxlovid, foreign exchange and higher Alliance revenues, partially offset by higher sales of Comirnaty, as well as the inventory write-offs and other charges related to Paxlovid and Comirnaty, respectively, discussed above.

• non-cash charges of $6.2 billion for inventory write-offs and related charges ($5.0 billion for Paxlovid and $1.2 billion for Comirnaty).

The increase in Cost of sales as a percentage of Total revenues was mainly driven by the non-cash charge of $6.2 billion discussed above, and unfavorable changes in sales mix, primarily due to lower sales of Paxlovid and Comirnaty, which includes the unfavorable impact of the $3.5 billion non-cash Paxlovid revenue reversal.

Selling, Informational and Administrative Expenses

Selling, informational and administrative expenses increased $974 million, mostly due to:

• an increase of $1.3 billion for Paxlovid and Comirnaty marketing and promotional expenses and a higher provision for U.S.

healthcare reform fees based on sales of Paxlovid;

• an increase of $540 million for marketing and promotional expenses for recently acquired and launched products,

Selling, informational and administrative expenses increased $1.1 billion, mostly due to:

• an increase of $1.1 billion in marketing and promotional expenses for recently acquired and launched products;

• an increase of $280 million for the expected Paxlovid commercial launch;

• an increase of $210 million in our liability to be paid to participants of our supplemental savings plan;

• an increase of $170 million in marketing and promotional expenses for rare disease products,

partially offset by:

• a $414 million favorable impact of foreign exchange;

• a $320 million decrease in spending across multiple customer groups;

• a decrease of $270 million in our liability to be paid to participants of our supplemental savings plan.

• a decrease of $690 million due to a lower provision for U.S.

healthcare reform fees related to Comirnaty and Paxlovid.

Research and Development Expenses

Research and development expenses increased $1.1 billion, primarily due to:

• increased investments of $1.3 billion for certain vaccine and oncology programs as well as costs to develop recently acquired assets, partially offset by lower spending of $480 million for various late-stage clinical programs and programs to treat COVID-19.

Research and development expenses increased $1.7 billion, mainly due to increased investments of $1.2 billion across multiple therapeutic areas, including additional spending related to the development of the oral COVID-19 treatment program.

Research and development expenses decreased $749 million, primarily due to:

• lower spending of $870 million mainly for lower compensation-related expenses, and ongoing vaccine and hospital programs, as well as

• a decrease of $260 million in the value of the portfolio performance share grants reflecting the decrease in the price of Pfizer’s common stock,

2023 Form 10-K

Acquired In-Process Research and Development Expenses

Acquired in-process research and development expenses decreased $2.5 billion largely due to:

• a charge of $2.1 billion related to our asset acquisition of Trillium in 2021;

• an upfront payment to Arvinas and a premium paid on our equity investment in Arvinas totaling $706 million in 2021,

partially offset by:

• acquired IPR&D incurred in 2022, including $426 million related to our asset acquisition of ReViral in 2022.

Acquired in-process research and development expenses increased $2.8 billion mainly due to:

• a $2.1 billion charge related to our asset acquisition of Trillium;

• a net increase in charges of $602 million for upfront and milestone payments on collaboration and licensing arrangements, driven by payments to Arvinas and Beam.

See Note s 2A , 2D and 2 E for additional information.

• increased investments of $345 million, mainly to develop certain acquired assets, as well as activities to support upcoming product launches.

Acquired In-Process Research and Development Expenses

Acquired in-process research and development expenses decreased $758 million primarily reflecting the non-recurrence of:

• an upfront payment of $426 million related to the closing of the acquisition of ReViral Ltd.

• an upfront payment to Biohaven and a premium paid on our equity investment in Biohaven totaling $263 million in 2022;

• a $76 million premium paid on our equity investment in BioNTech to develop a potential mRNA vaccine against shingles, both recorded in 2022.

See Notes 2A and 2E .

Amortization of Intangible Assets

Amortization of intangible assets decreased $91 million, primarily due to lower amortization of Comirnaty sales milestones to BioNTech, as well as lower amortization of intangible assets related to Prevnar and fully amortized assets, partially offset by amortization of intangible assets from our acquisitions of Biohaven and GBT.

See Notes 2A and 10A for additional information.

Amortization of intangible assets increased $1.1 billion, primarily as a result of 2023 reflecting a full year of amortization of intangible assets from our acquisitions of Biohaven and GBT, higher amortization of intangible assets related to Prevnar, as well as reclassifications of IPR&D to developed technology rights, partially offset by fully amortized assets.

See Notes 2A and 10A .

Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives

Transforming to a More Focused Company Program –– For a description of our program and actual costs, see Note 3 .

The program savings discussed below may be rounded and represent approximations.

In connection with restructuring our corporate enabling functions, we achieved gross cost savings of $1.0 billion, or net cost savings, excluding merit and inflation growth and certain real estate cost increases, of $700 million, in the two year period from 2021 through 2022.

Transforming to a More Focused Company Program –– In connection with restructuring our corporate enabling functions, we achieved gross cost savings of $1.0 billion, or net cost savings, excluding merit and inflation growth and certain real estate cost increases, of $700 million, in the two year period from 2021 through 2022.

In connection with transforming our commercial go-to market strategy, we expect net cost savings of $1.4 billion, to be achieved primarily from 2022 through 2024.

In connection with manufacturing network optimization, we expect net cost savings of $550 million to be achieved primarily from 2020 through 2023.

In connection with manufacturing network optimization, we achieved net cost savings of $550 million.

In connection with optimizing our end-to-end R&D operations, we expect net cost savings of $2.3 billion to be achieved primarily from 2023 through 2025.

Certain qualifying costs for this program were recorded in 2022, 2021 and 2020, and are reflected as Certain Significant Items and excluded from our non-GAAP measure of Adjusted Income.

Realigning our Cost Base Program –– This program is expected to deliver net cost savings of at least $4 billion, to be achieved primarily from 2023 through 2024.

Certain qualifying costs for these programs were recorded in 2023, 2022 and 2021, and are reflected as Certain Significant Items and excluded from our non-GAAP measure of Adjusted Income.

See the Non-GAAP Financial Measure:

Adjusted Income section of this MD&A.

In addition to this program, we continuously monitor our operations for cost reduction and/or productivity opportunities, especially in light of the losses of exclusivity and the expiration of collaborative arrangements for various products.

Adjusted Income section within MD&A.

In connection with our acquisition of Seagen, we are focusing our efforts on achieving an appropriate cost structure for the combined company.

We expect to generate approximately $1 billion of annual cost synergies, to be achieved by 2026.

For a description of our programs, as well as the anticipated and actual costs, see Note 3A , The program savings discussed above may be rounded and represent approximations.

In addition to these programs, we continuously monitor our operations for cost reduction and/or productivity opportunities, especially in light of the losses of exclusivity and the expiration of collaborative arrangements for various products.

Other (Income)/Deductions––Net

The period-over-period change of $5.1 billion resulting in net other deductions in 2022 compared to net other income in 2021 was primarily driven by net losses recognized on equity securities in 2022 versus net gains recognized in 2021, lower net periodic benefit credits, and higher asset impairment charges.

See Note 4 for additional information .

The favorable period-over-period change of $1.1 billion was primarily driven by net gains on equity securities in 2023 versus net losses recognized on equity securities in 2022 and lower net interest expense, partially offset by higher intangible asset impairment charges.

Upjohn Separation Costs

Since inception through December 31, 2023, we have incurred substantially all costs of approximately $700 million in connection with separating Upjohn, including costs and expenses related to separation of legal entities and transaction costs.

Provision/(Benefit) for Taxes on Income

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For information about our effective tax rate and the events and circumstances contributing to the changes between periods, as well as details about discrete elements that impacted our tax provisions, see Note 5 .

Changes in Tax Laws–– Many countries outside the U.S.

have enacted legislation for global minimum taxation resulting from the Organization for Economic Co-operation and Development’s (OECD) Base Erosion and Profit Shifting “Pillar 2” project.

The EU has approved a directive requiring member states to incorporate the OECD provisions into their respective domestic laws, and other countries outside the EU are also enacting the provisions into their domestic law.

The provisions are generally effective for Pfizer in 2024, though significant details and guidance around the provisions are still pending.

Income tax expense could be adversely affected as the legislation becomes effective in countries in which we do business, and such impact could be material to our results of operations.

We continue to monitor pending OECD guidance and legislation enactment and implementation by individual countries.

Discontinued Operations

For information about our discontinued operations, see Note 2B .

2023 Form 10-K

PRODUCT DEVELOPMENTS

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It includes an overview of our research and a list of compounds in development with targeted indication and phase of development, as well as mechanism of action for some candidates in Phase 1 and all candidates from Phase 2 through registration.

The following provides information about significant marketing application-related regulatory actions by, and filings pending with, the FDA and regulatory authorities in the EU and Japan.

2022 Form 10-K 35

This section provides information as of the date of this filing about significant marketing application-related regulatory actions by, and filings pending with, the FDA and regulatory authorities in the EU and Japan.

The tables below include filing and approval milestones for products that have occurred in the last twelve months and generally do not include approvals that may have occurred prior to that time.

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COVID-19 Vaccine Products

PATIENT POPULATION AND DATE OF APPROVAL/FILING (a)

COVID-19 VACCINE PRODUCT (b)

PRIMARY SERIES

OR BOOSTER 16 Years of age and older 12-15 Years of age 5-11 Years of age 6 Months through 4 Years of age

EU JAPAN U.S.

30-µg 2-dose primary (c)

10-µg 2-dose primary (d)

3-µg 3-dose primary

Primary Approved

30-µg booster dose (e)

10-µg booster dose

Booster EUA (f)

Comirnaty Original/Omicron BA.4/BA.5 Vaccine (g)

Booster 30-µg booster dose 10-µg booster dose 3-µg booster dose

Comirnaty Original/Omicron BA.1 Vaccine Booster 30-µg booster dose

(a) All EU approvals prior to October 10, 2022 were under the CMA, and later converted to full Marketing Authorization as of October 10, 2022.

Dates shown in table reflect original CMA date.

(b) All COVID-19 vaccine products listed in this table are being developed in collaboration with BioNTech.

(c) FDA has authorized a third 30-µg primary series dose to individuals 12 years of age and older with certain kinds of immunocompromise.

(d) FDA has authorized a third 10-µg primary series dose to individuals 5-11 years of age with certain kinds of immunocompromise.

(e) FDA has authorized a second booster dose in adults ages 50 years and older who have previously received a first booster of any authorized COVID-19 vaccine.

The FDA also has authorized a second booster dose for individuals 12 years of age and older who have been determined to have certain kinds of immunocompromise and who have received a first booster dose of any authorized COVID-19 vaccine.

(f) Comirnaty wild-type booster in these populations has been replaced by the booster of the Pfizer-BioNTech COVID-19 Vaccine, Bivalent (Original and Omicron BA.4/BA.5).

(g) Refers to the Pfizer-BioNTech COVID-19 Vaccine, Bivalent (Original and Omicron BA.4/BA.5) and Comirnaty Original/Omicron BA.4/BA.5 Vaccine.

(h) The third dose of the primary series 6 months through 4 years of age in the U.S.

has been replaced by the 3-µg booster of the Pfizer-BioNTech COVID-19 Vaccine, Bivalent (Original and Omicron BA.4/BA.5).

Beginning with the original monovalent Pfizer-BioNTech COVID-19 Vaccine, initially authorized for emergency use, to Comirnaty (COVID-19 Vaccine, mRNA, 2023-2024 Formula), approved by the FDA for individuals 12 years and older and the Pfizer-BioNTech COVID-19 Vaccine (2023-2024 Formula) authorized by the FDA for emergency use for individuals 6 months through 11 years of age, efforts to stay current with circulating COVID-19 strains have resulted in the rapid development of targeted, adapted vaccines for licensure in the U.S., Europe, Japan and other markets.

The adapted vaccines have included two bivalent formulations (Original and Omicron BA.1, not authorized in the U.S., and Original and Omicron BA.4/BA.5).

As updated COVID-19 vaccines are formulated to more closely target currently circulating vaccines, prior vaccine formulations are generally no longer utilized in a majority of the markets.

The 2023-2024 Formula includes a monovalent (single) component that corresponds to the Omicron sub-variant XBB.1.5 of severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2).

The table below summarizes the approval of the 2023-2024 Formula in the markets indicated:

REGULATORY STATUS

(COVID-19 Vaccine,

mRNA, 2023-2024 Formula) Active immunization to prevent COVID-19 caused by SARS-CoV-2 for individuals 6 months through 4 years of age Authorized

Active immunization to prevent COVID-19 caused by SARS-CoV-2 for individuals 5 through 11 years of age Authorized

Active immunization to prevent COVID-19 caused by SARS-CoV-2 in individuals 12 years of age and older Approved

(a) In September 2023, Pfizer and BioNTech announced the FDA approved a regulatory application for their Omicron XBB.1.5-adapted monovalent COVID-19 vaccine for individuals 12 years of age and older (Comirnaty (COVID-19 Vaccine, mRNA, 2023-2024 Formula)).

The FDA also granted EUA for the Omicron XBB.1.5-adapted monovalent COVID-19 vaccine for individuals 6 months through 11 years of age (Pfizer-BioNTech COVID-19 Vaccine (2023-2024 Formula)).

2023 Form 10-K

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PRODUCT INDICATION OR PROPOSED INDICATION APPROVED/FILED*

(relugolix, estradiol, and norethindrone acetate) (a)

Heavy menstrual bleeding associated with uterine fibroids

Moderate to severe pain associated with endometriosis

(somatrogon) (b)

(somatrogon) (a)

Pediatric growth hormone deficiency

Prevnar 20/Apexxnar

(Vaccine) (c)

Active immunization to prevent invasive disease caused by Streptococcus pneumoniae serotypes (adults)

Active immunization to prevent pneumonia, invasive disease and otitis media caused by Streptococcus pneumoniae (adults)

Active immunization to prevent pneumonia, invasive disease and otitis media caused by Streptococcus pneumoniae (pediatric)

(Vaccine) Active immunization to prevent tick-borne encephalitis disease Approved

Paxlovid (d) (nirmatrelvir [PF-07321332];

COVID-19 in high-risk adults and children (12-18 years of age;

Paxlovid (b ) (nirmatrelvir and ritonavir)

COVID-19 in high-risk adults Approved

Nurtec ODT/Vydura

Acute treatment of migraine with or without aura (adults) Approved Feb.

Prevention of episodic migraine (adults) Approved May

ritlecitinib (PF-06651600) Alopecia areata Filed

(intranasal) Acute treatment of migraine Filed

(Vaccine) Active immunization to prevent serogroups ABCWY meningococcal infections (adolescent and young adults) Filed

(Vaccine) Active immunization to prevent respiratory syncytial virus infection (maternal) Filed

Active immunization to prevent respiratory syncytial virus infection (older adults) Filed

etrasimod Ulcerative colitis (moderately to severely active) Filed

(Vaccine) Active immunization to prevent invasive and non-invasive pneumococcal infections (pediatric) Filed

elranatamab (PF-06863135) Multiple myeloma triple-class refractory

Acute treatment of migraine with or without aura (adults) Approved

Prevention of episodic migraine (adults) Approved

Litfulo/Ritfulo

(ritlecitinib) Alopecia areata Approved

Zavzpret (zavegepant)

(intranasal) Acute treatment of migraine with or without aura (adults) Approved

Penbraya (PF-06886992)

(Vaccine) Active immunization to prevent serogroups ABCWY meningococcal infections (adolescent and young adults) Approved

(Vaccine) Active immunization to prevent RSV infection (maternal) Approved

Active immunization to prevent RSV infection (older adults) Approved

Velsipity (etrasimod) Ulcerative colitis (moderately to severely active) Approved

Braftovi (encorafenib) and Mektovi (binimetinib) BRAF V600E -mutant metastatic non-small cell lung cancer

Elrexfio (elranatamab) Multiple myeloma triple-class relapsed/refractory

Talzenna (talazoparib) Combination with Xtandi (enzalutamide) for adult patients with homologous recombination repair (HRR) gene-mutated mCRPC (d)

Treatment of BRCA gene-mutated, HER2-negative, inoperable or recurrent breast cancer who have been treated with cancer chemotherapy Approved

fidanacogene elaparvovec (PF-06838435) (e)

Hemophilia B (adults) Filed

Xtandi (enzalutamide) (f)

nmCSPC with biochemical recurrence at high risk for metastasis (high-risk BCR)

marstacimab (PF-06741086) Hemophilia A and B Filed

aztreonam-avibactam (g)

(PF-06947387)

Treatment of infections caused by Gram-negative bacteria with limited or no treatment options Filed

Padcev (enfortumab vedotin-ejfv) (h)

In combination with Keytruda (i) (pembrolizumab) for locally advanced or metastatic urothelial cancer (adults)

Tivdak (tisotumab vedotin-tftv) (j)

Recurrent or metastatic cervical cancer with disease progression on or after first-line therapy Filed (k)

Tukysa (tucatinib) In combination with trastuzumab for HER2-positive metastatic colorectal cancer that has progressed following treatment with fluoropyrimidine-, oxaliplatin-, and irinotecan-based chemotherapy Approved

2023 Form 10-K

* For the U.S., the filing date is the date on which the FDA accepted our submission.

For the EU, the filing date is the date on which the EMA validated our submission.

(a) Being developed in collaboration with Myovant.

In January 2023, the FDA approved the sNDA to include data from the Randomized Withdrawal Study into section 14 of the label.

(b) Being developed in collaboration with OPKO.

(c) In October 2022, the CDC’s ACIP voted to recommend a single dose of Prevnar 20 to help protect adults previously vaccinated with Prevnar 13 or both Prevnar 13 and PPSV23 against invasive disease and pneumonia caused by the 20 Streptococcus pneumoniae serotypes in Prevnar 20.

(d) In June 2022, we announced the submission of an NDA to the FDA for approval of Paxlovid for the treatment of COVID-19 in both vaccinated and unvaccinated individuals who are at high risk for progression to severe illness from COVID-19.

In December 2022, Pfizer announced the FDA has extended the review period for the NDA for Paxlovid.

At the request of the FDA, Pfizer recently submitted additional analyses of efficacy and safety data from the pivotal Evaluation of Protease Inhibition for COVID-19 in High-Risk Patients and supportive Evaluation of Protease Inhibition for COVID-19 in Standard-Risk Patients trials to be considered as part of its NDA for Paxlovid.

Results from these analyses are consistent with previously disclosed efficacy and safety data for the trials.

In order to allow time for a full review of the application, including the additional data analyses submitted, the FDA has extended the Prescription Drug User Fee Act goal date by three months to May 2023.

In December 2021, in light of the results from the completed required postmarketing safety study of Xeljanz, ORAL Surveillance (A3921133), the U.S.

label for Xeljanz was revised.

In addition, in November 2022, the EMA concluded their assessment of JAK inhibitors authorized for inflammatory diseases in the EU, including Xeljanz and Cibinqo, and recommended that risk minimization measures, including special warnings and precautions for use, should be revised and harmonized for all such JAK inhibitors.

The resulting label changes are expected to be finalized in the first quarter of 2023.

We continue to work with regulatory agencies worldwide to review the full results and analyses of ORAL Surveillance and their impact on product labeling.

For additional information, see Item 1A.

Risk Factors—Post-Authorization/Approval Data .

In China, the following products received regulatory approvals in the last twelve months:

Paxlovid for COVID-19 infection in February 2022;

Cibinqo for atopic dermatitis in April 2022;

Lorbrena for non-small cell lung cancer (first line and second line therapy) in April 2022;

Xeljanz for ankylosing spondylitis in April 2022;

Cresemba (IV formulation) for the treatment of adult patients with invasive aspergillosis and invasive mucormycosis in June 2022;

and Xeljanz for the treatment of adult patients with active psoriatic arthritis in October 2022.

2022 Form 10-K 37

(a) Being developed in collaboration with OPKO.

(b) Previously authorized under EUA in the U.S.

(December 2021) and approved by the FDA in high-risk adults (May 2023).

Remains under EUA for children (12-18 years of age;

>88lbs) in the U.S.

(d) Listed indication applies to U.S.

EU indication (all comers):

mCRPC in whom chemotherapy is not clinically indicated;

Japan indication:

BRCA gene-mutated mCRPC.

(e) Being developed in collaboration with Spark Therapeutics, Inc.

(f) Being developed in collaboration with Astellas.

(g) Being developed in collaboration with AbbVie.

AbbVie has the exclusive commercialization rights to this investigative therapy in the U.S.

Pfizer leads the joint development program and has commercialization rights in all other countries.

(h) Being developed in collaboration with Astellas.

(i) Keytruda is a registered trademark of Merck Sharp & Dohme Corp.

(j) Being developed in collaboration with Genmab.

(k) January 2024 filing date refers to application for conversion from accelerated to full approval.

The following provides information about additional indications and new drug candidates in late-stage development:

PRODUCT/CANDIDATE PROPOSED INDICATION

PRODUCT/CANDIDATE PROPOSED DISEASE AREA

LATE-STAGE CLINICAL PROGRAMS FOR ADDITIONAL USES AND DOSAGE FORMS FOR IN-LINE AND IN-REGISTRATION PRODUCTS

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ER+/HER2+ metastatic breast cancer

Xtandi (enzalutamide) (b)

Non-metastatic high-risk castration sensitive prostate cancer

Talzenna (talazoparib) Combination with Xtandi (enzalutamide) for first-line mCRPC

Combination with Xtandi (enzalutamide) for DNA Damage Repair (DDR)-deficient mCSPC

PF-06482077 (Vaccine) Immunization to prevent invasive and non-invasive pneumococcal infections (pediatric)

somatrogon (PF-06836922) (c)

Talzenna (talazoparib) Combination with Xtandi (enzalutamide) for DNA Damage Repair-deficient mCSPC

Ngenla (somatrogon) (b)

Adult growth hormone deficiency

Braftovi (encorafenib) and Erbitux ® (cetuximab) (d)

Braftovi (encorafenib) and Erbitux® (cetuximab) (c)

First-line BRAF V600E -mutant mCRC

Braftovi (encorafenib) and Mektovi (binimetinib) and Keytruda ® (pembrolizumab) (e)

BRAF V600E/K -mutant metastatic or unresectable locally advanced melanoma

Braftovi (encorafenib) and Mektovi (binimetinib) BRAF V600E -mutant non-small cell lung cancer

Paxlovid (nirmatrelvir [PF-07321332];

Paxlovid (nirmatrelvir;

ritonavir) COVID-19 in high-risk children (6-11 years of age;

zavegepant (oral) Prevention of acute migraine (adults)

ritlecitinib (PF-06651600) Vitiligo

elranatamab (PF-06863135) Multiple myeloma double-class exposed

Litfulo (ritlecitinib) Vitiligo

Elrexfio (elranatamab) Multiple myeloma double-class exposed

Newly diagnosed multiple myeloma post-transplant maintenance

Eliquis (apixaban) Venous thromboembolism (pediatric)

NEW DRUG CANDIDATES IN LATE-STAGE DEVELOPMENT aztreonam-avibactam

(PF-06947387) Treatment of infections caused by Gram-negative bacteria with limited or no treatment options

fidanacogene elaparvovec (PF-06838435) (f)

giroctocogene fitelparvovec

(PF-07055480) (g)

Newly diagnosed multiple myeloma transplant-ineligible

Oxbryta (voxelotor) Sickle cell disease (pediatric)

Eliquis (apixaban) (d)

Venous thromboembolism (pediatric)

Abrysvo (vaccine) Active immunization to prevent RSV infection in adults (18-59)

Padcev (enfortumab vedotin) (e)

Cisplatin-ineligible/decline muscle-invasive bladder cancer

Cisplatin-eligible muscle-invasive bladder cancer

Tukysa (tucatinib)

HER2+ adjuvant breast cancer

2nd line/3rd line HER2+ metastatic breast cancer

1st line HER2+ metastatic colorectal cancer

NEW DRUG CANDIDATES IN LATE-STAGE DEVELOPMENT giroctocogene fitelparvovec

(PF-07055480) (f)

PF-06425090 (Vaccine) Immunization to prevent primary clostridioides difficile infection

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fordadistrogene movaparvovec (PF-06939926) Duchenne muscular dystrophy (ambulatory)

marstacimab (PF-06741086) Hemophilia

Omicron-based mRNA vaccine (h)

Immunization to prevent COVID-19 (adults)

VLA15 (PF-07307405) vaccine (i)

VLA15 (PF-07307405) vaccine (g)

Immunization to prevent Lyme disease

PF-07252220 (quadrivalent mRNA-based vaccine) Immunization to prevent influenza

Vepdegestrant (PF-07850327) (h)

Breast cancer metastatic - 2 nd line ER+/HER2-

inclacumab (PF-07940370) Sickle cell disease

Ibrance + vepdegestrant (h)

ER+/HER2- metastatic breast cancer

Dazukibart (PF-06823859)

Dermatomyositis, polymyositis

Disitamab vedotin (i)

1st line HER2 (≥IHC1+) metastatic urothelial cancer

PF-07926307 (COVID/flu combo vaccine) (j)

Immunization to prevent COVID infection and influenza

sisunatovir (PF-07923568)

Respiratory syncytial virus infection (adults)

Braftovi/Mektovi/Keytruda previously listed as a late-stage clinical candidate is no longer considered registrational and has been removed.

Zavzpret oral for the prevention of chronic migraine previously listed as a late-stage clinical candidate has been removed.

(a) Being developed in collaboration with The Alliance Foundation Trials, LLC.

(b) Being developed in collaboration with Astellas.

(d) Erbitux ® is a registered trademark of ImClone LLC.

In the EU, we are developing in collaboration with the Pierre Fabre Group.

In Japan, we are developing in collaboration with Ono.

(e) Keytruda ® is a registered trademark of Merck Sharp & Dohme Corp.

(b) Being developed in collaboration with OPKO.

In the EU, we are developing in collaboration with the Pierre Fabre Group.

In Japan, we are developing in collaboration with Ono.

(f) Being developed in collaboration with Spark Therapeutics, Inc.

(g) Being developed in collaboration with Sangamo Therapeutics, Inc.

(h) Being developed in collaboration with BioNTech.

(i) Being developed in collaboration with Valneva.

For additional information about our R&D organization, see the Item 1.

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

(d) Being developed in collaboration with BMS.

(e) Being developed in collaboration with Astellas.

(f) Being developed in collaboration with Sangamo Therapeutics, Inc.

(g) Being developed in collaboration with Valneva.

(h) Vepdegestrant is being developed in collaboration with Arvinas.

(i) Being developed in collaboration with RemeGen Co., Ltd.

(j) Being developed in collaboration with BioNTech.

2023 Form 10-K

For additional information about our R&D organization, see Note 17 and the Item 1.

Business — Research and Development section.

For additional information regarding certain collaboration arrangements, see Item 1.

Business — Collaboration and Co-Promotion Agreements .

NON-GAAP FINANCIAL MEASURE:

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In addition, total shareholder return, both on an absolute basis and relative to a publicly traded pharmaceutical index, plays a significant role in determining payouts under certain of our incentive compensation plans.

Beginning in the first quarter of 2022, our reconciliation of certain GAAP Reported to non-GAAP Adjusted information is updated to reflect the following, and prior-period information has been revised to conform to the current period presentation:

Adjusted Income and Adjusted Diluted EPS

Acquired IPR&D —Non-GAAP Adjusted financial measures include expenses for all acquired IPR&D costs incurred in connection with upfront and milestone payments on collaboration and in-license agreements, including premiums on equity securities, as well as asset acquisitions of acquired IPR&D.

Previously, certain of these items were excluded from our non-GAAP Adjusted results.

Acquired IPR&D expenses that previously would have been excluded from non-GAAP Adjusted income but are now included in both GAAP Reported income and non-GAAP Adjusted income were approximately:

(i) $765 million pre-tax ($665 million, net of tax), or $0.12 per share, in 2022;

(ii) $3.3 billion pre-tax ($2.6 billion, net of tax), or $0.45 per share, in 2021;

and (iii) $504 million pre-tax ($397 million, net of tax), or $0.07 per share, in 2020.

Amortization of Intangible Assets —We began excluding all amortization of intangibles from non-GAAP Adjusted income, compared to excluding only amortization of intangibles related to large mergers or acquisitions under the prior methodology, and presenting it as a separate reconciling line.

Previously, the adjustment under the prior methodology was included as part of a reconciling line entitled “Purchase accounting adjustments” that we no longer separately present.

The impact of this policy change resulted in benefits on Adjusted diluted EPS of $0.06 in 2022, $0.09 in 2021 and $0.05 in 2020.

Acquisition-Related Items –– Adjusted income continues to exclude certain acquisition-related items, which are comprised of transaction, integration, restructuring charges and additional depreciation costs for business combinations because these costs are unique to each

2022 Form 10-K 39

transaction and represent costs that were incurred to restructure and integrate businesses as a result of an acquisition.

Amortization of Intangible Assets —Adjusted income excludes all amortization of intangible assets.

Acquisition-Related Items –– Adjusted income excludes certain acquisition-related items, which are composed of transaction, integration, restructuring charges and additional depreciation costs for business combinations because these costs are unique to each transaction and represent costs that were incurred to restructure and integrate businesses as a result of an acquisition.

We have made no adjustments for resulting synergies.

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Because of the need for certain external approvals for some actions, the span of time needed to achieve certain restructuring and integration activities can be lengthy.

Acquisition-related items may now include purchase accounting impacts that previously would have been included as part of a reconciling line entitled “Purchase accounting adjustments” that we no longer separately present, such as:

(i) the incremental charge to cost of sales from the sale of acquired inventory that was written up to fair value;

(ii) depreciation related to the increase/decrease in fair value of acquired fixed assets;

(iii) amortization related to the increase in fair value of acquired debt and (iv) the fair value changes for contingent consideration.

Discontinued Operations –– Adjusted income continues to exclude the results of discontinued operations, as well as any related gains or losses on the disposal of such operations.

Acquisition-related items may include purchase accounting impacts such as the incremental charge to cost of sales from the sale of acquired inventory that was written up to fair value, depreciation related to the increase/decrease in fair value of acquired fixed assets, amortization related to the increase in fair value of acquired debt, and the fair value changes for contingent consideration.

2023 Form 10-K

Discontinued Operations –– Adjusted income excludes the results of discontinued operations, as well as any related gains or losses on the disposal of such operations.

We believe that this presentation is meaningful to investors because, while we review our product portfolio for strategic fit with our operations, we do not build or run our business with the intent to discontinue parts of our business.

Restatements due to discontinued operations do not impact compensation or change the Adjusted income measure for the compensation in respect of the restated periods, but are presented for consistency across all periods.

Certain Significant Items –– Adjusted income continues to exclude certain significant items representing substantive and/or unusual items that are evaluated individually on a quantitative and qualitative basis.

Certain Significant Items –– Adjusted income excludes certain significant items representing substantive and/or unusual items that are evaluated individually on a quantitative and qualitative basis.

Certain significant items may be highly variable and difficult to predict.

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Legal charges to resolve litigation are also related to specific cases, which are facts and circumstances specific and, in some cases, may also be the result of litigation matters at acquired companies that were inestimable, not probable or unresolved at the date of acquisition, or legal matters related to divested products or businesses.

Gains and losses on equity securities, and pension and postretirement actuarial remeasurement gains and losses have a very high degree of inherent market volatility, which we do not control and cannot predict with any level of certainty and because we do not believe including these gains and losses assists investors in understanding our business or is reflective of our core operations and business.

Gains and losses on equity securities and pension and postretirement actuarial remeasurement gains and losses have a very high degree of inherent market volatility, which we do not control and cannot predict with any level of certainty, and we do not believe including these gains and losses assists investors in understanding our business or is reflective of our core operations and business.

Unusual items represent items that are not part of our ongoing business;

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Other (238) (g)

(24) (246) (h)

Income tax provision—Non-GAAP items (2,131)

Non-GAAP Adjusted $ 23,988 $ 14,446 $ (2,281) $ 10,501 $ 1.84

2022 Form 10-K 40

Year Ended December 31, 2022

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Net income attributable to Pfizer Inc.

common shareholders (a), (b)

common shareholders (a), (b), (c)

Earnings per common share attributable to Pfizer Inc.

7 unchanged sentences

(88) (562) — 1,396

Certain asset impairments — — (86) 86

Certain asset impairments (f)

— — (421) 421

(Gains)/losses on equity securities (f)

4 unchanged sentences

Non-GAAP Adjusted $ 34,096 $ 13,049 $ (1,954) $ 37,717 $ 6.58

2023 Form 10-K

Year Ended December 31, 2021

12 unchanged sentences

Discontinued operations (d)

— — — (2,879)

Certain significant items:

1 unchanged sentence

(108) (450) — 1,309

Certain asset impairments (f)

— — (1,691) 1,691

Certain asset impairments

(Gains)/losses on equity securities (f)

1 unchanged sentence

Actuarial valuation and other pension and postretirement plan (gains)/losses — — 1,601 (1,601)

Other (56) (292) (h)

Other (52) (141) (i)

Income tax provision—Non-GAAP items (2,250)

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9.0% in 2023, 11.7% in 2022 and 14.5% in 2021.

(b) Includes reconciling amounts for Research and development expenses that are not material.

(c) For 2022, the total acquisition-related items of $832 million include reconciling amounts for Restructuring charges and certain acquisition-related costs of $631 million , composed of $348 million of integration costs and other charges, $144 million of transaction costs and $138 million of employee termination-related charges.

(d) For information about discontinued operations, see Note 2B .

(b) Includes reconciling amounts for Research and development expenses that are not material to our non-GAAP consolidated results of operations.

(c) For 2023, the total acquisition-related items of $1.9 billion include reconciling amounts for Restructuring charges and certain acquisition-related costs of $1.2 billion, mainly composed of $785 million of integration costs and other charges, $190 million of transaction costs and $125 million of employee termination-related charges.

For 2022, the total acquisition-related items of $832 million included reconciling amounts for Restructuring charges and certain acquisition-related costs of $631 million , composed of $348 million of integration costs and other charges, $144 million of transaction costs and $138 million of employee termination-related charges.

(d) See Note 2B .

(e) Includes employee termination costs, asset impairments and other exit costs related to our cost-reduction and productivity initiatives not associated with acquisitions.

(f) See Note 4 .

(g) For 2022, the total of $636 million primarily includes (i) charges of $307 million mostly representing our equity-method accounting pro rata share of restructuring charges and costs of preparing for separation from GSK recorded by Haleon/the Consumer Healthcare JV, and adjustments to our equity-method basis differences which are also related to the separation of Haleon/the Consumer Healthcare JV from GSK, and (ii) charges of $230 million for certain legal matters, primarily for c ertain product liability and other expenses related to products discontinued and/or divested by Pfizer .

For 2021, the total of $334 million primarily included (i) charges of $185 million mostly representing our equity-method accounting pro rata share of restructuring charges and costs of preparing for separation from GSK recorded by the Consumer Healthcare JV, and (ii) charges of $162 million for certain legal matters, primarily for c ertain product liability expenses related to products discontinued and/or divested by Pfizer, and to a lesser extent, legal obligations related to pre-acquisition commitments .

For 2020, the total of $691 million primarily included (i) charges of $367 million mostly representing our equity-method accounting pro rata share of transaction-specific restructuring and business combination accounting charges recorded by the Consumer Healthcare JV, and (ii) losses on asset disposals of $238 million.

(h) For 2021 and 2020, the totals of $141 million and $292 million, respectively, primarily included costs for consulting, legal, tax and advisory services associated with a non-recurring internal reorganization of legal entities.

(g) For 2023, the total of $238 million mainly includes $286 million in inventory losses, overhead costs related to the period in which the facility could not operate, and incremental costs resulting from tornado damage to our manufacturing facility in Rocky Mount, NC, partially offset by insurance recoveries.

(h) For 2023, the total of $246 million includes charges of (i) $474 million for certain legal matters, primarily representing certain product liability and other legal expenses related to products discontinued and/or divested by Pfizer, and to a lesser extent, legal obligations related to pre-acquisition matters, and (ii) $127 million mostly related to our equity-method accounting pro-rata share of intangible asset amortization and impairments, costs of separating from GSK and restructuring costs recorded by Haleon, partially offset by:

(i) a $222 million gain on the divestiture of our early-stage rare disease gene therapy portfolio to Alexion, and (ii) dividend income of $211 million related to our investment in Nimbus resulting from Takeda’s acquisition of Nimbus’s oral, selective allosteric tyrosine kinase 2 (TYK2) inhibitor program subsidiary.

For 2022, the total of $636 million included charges of (i) $307 million mostly representing our equity-method accounting pro rata share of restructuring charges and costs of separating from GSK recorded by Haleon/the Consumer Healthcare JV, and adjustments to our equity-method basis differences which are also related to the separation of Haleon/the Consumer Healthcare JV from GSK, and (ii) $230 million for certain legal matters, primarily representing c ertain product liability and other legal expenses related to products discontinued and/or divested by Pfizer .

For 2021, the total of $334 million included charges of (i) $185 million mostly representing our equity-method accounting pro rata share of restructuring charges and costs of separating from GSK recorded by the Consumer Healthcare JV, and (ii) $162 million for certain legal matters, primarily for c ertain product liability expenses related to products discontinued and/or divested by Pfizer, and to a lesser extent, legal obligations related to pre-acquisition matters .

(i) For 2021, the total of $141 million primarily included costs for consulting, legal, tax and advisory services associated with a non-recurring internal reorganization of legal entities.

2023 Form 10-K

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Cash provided by/(used in):

Operating activities from continuing operations $ 29,267 $ 32,922 $ 10,540 The change was driven primarily by a net increase in payments to BioNTech for the gross profit split for Comirnaty (see Note 8B ) and an increase in noncurrent inventories primarily driven by a strategic build for Paxlovid (see Note 8A ), partially offset by higher net income adjusted for non-cash items and the timing of receipts and payments in the ordinary course of business.

Investing activities from continuing operations $ (15,783) $ (22,534) $ (4,162) The change was driven mainly by a $17.4 billion increase in proceeds from redemptions of short-term investments with original maturities of greater than three months, a $7.6 billion decrease in net purchases of short-term investments with original maturities of three months or less and a $4.0 billion dividend received from the Consumer Healthcare JV in 2022 that was allocated to investing activities (see Note 2C ), partially offset by cash paid for acquisitions in 2022 of $23.0 billion (Biohaven, $11.5 billion, Arena, $6.2 billion and GBT, $5.2 billion), net of cash acquired (see Note 2A ).

Financing activities from continuing operations $ (14,834) $ (9,816) $ (21,640) The change was driven mostly by $2.0 billion of purchases of the Company’s common stock in 2022, a $1.3 billion increase in repayments of long-term debt, and a $997 million decrease in proceeds from the issuance of long-term debt.

Cash Flows from Discontinued Operations –– In 2021, cash flows from discontinued operations primarily relate to our former Meridian subsidiary, Upjohn Business and the Mylan-Japan collaboration (see Note 2B ).

Operating activities from continuing operations $ 8,700 $ 29,267 $ 32,922 The change was driven primarily by a decrease in net income adjusted for non-cash items and the timing of receipts and payments in the ordinary course of business, partially offset by net changes in inventory greater than one year (see Note 8A ).

Investing activities from continuing operations $ (32,278) $ (15,783) $ (22,534) The change was driven mainly by $43.4 billion cash paid in 2023 for the acquisition of Seagen, net of cash acquired, compared with $23.0 billion cash paid in 2022 for acquisitions (Biohaven, $11.5 billion, Arena, $6.2 billion and GBT, $5.2 billion), net of cash acquired (see Note 2A ), as well as a $4.0 billion dividend received from the Consumer Healthcare JV in 2022 that was allocated to investing activities (see Note 2C ), partially offset by a $5.5 billion increase in net redemptions of short-term investments in 2023 and a $1.7 billion decrease in purchases of long-term investments.

Financing activities from continuing operations $ 26,066 $ (14,834) $ (9,816) The change was driven mostly by $30.8 billion of proceeds from the issuance of long-term debt in May of 2023 and a $7.9 billion increase in net proceeds from the issuance of short-term borrowings.

ANALYSIS OF FINANCIAL CONDITION, LIQUIDITY, CAPITAL RESOURCES AND MARKET RISK

Due to our significant operating cash flows, which is a key strength of our liquidity and capital resources and our primary funding source, as well as our financial assets, access to capital markets, revolving credit agreements, and available lines of credit, we believe that we have, and will maintain, the ability to meet our liquidity needs to support ongoing operations, our capital allocation objectives, and our contractual and other obligations for the foreseeable future.

Our historically robust operating cash flow, which we expect to continue over time, is a key strength of our liquidity and capital resources and our primary funding source.

We believe as a result of this, together with our financial assets, access to capital markets, revolving credit agreements, and available lines of credit, we have and will maintain the ability to meet our liquidity needs to support ongoing operations, our capital allocation objectives, and our contractual and other obligations for the foreseeable future.

We focus efforts to optimize operating cash flows through achieving working capital efficiencies that target accounts receivable, inventories, accounts payable, and other working capital.

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• Operating cash flows

Consolidated Statements of Cash Flows – Operating Activities and the Analysis of the Consolidated Statements of Cash Flows within MD&A

Consolidated Statements of Cash Flows – Operating Activities and the Analysis of the Consolidated Statements of Cash Flows section within MD&A

• Cash and cash equivalents

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• Available-for-sale debt securities

• Equity investments

External sources:

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Consolidated Statements of Equity and Note 12

For additional information about the sources and uses of our funds and capital resources for the years ended December 31, 2022 and 2021, see the Analysis of the Consolidated Statements of Cash Flows in this MD&A.

For additional information about the sources and uses of our funds and capital resources for the years ended December 31, 2023 and 2022, see the Analysis of the Consolidated Statements of Cash Flows section within MD&A.

Financing for Seagen Acquisition ––As part of the financing for our acquisition of Seagen, we issued $31 billion of long-term debt in May 2023 and $8 billion of commercial paper in the fourth quarter of 2023.

The net proceeds from long-term debt were invested in short-term investments in a combination of money market funds and available-for-sale debt securities until the completion of the acquisition.

2023 Form 10-K

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Our long-term debt is rated high-quality by both S&P and Moody’s.

In November 2022, Moody’s increased the rating on our long-term debt from A2 to A1 as well as the outlook on our long-term debt to Stable;

S&P continues to rate the outlook of our long-term debt as Stable since November 2020.

The current ratings assigned to our commercial paper and senior unsecured long-term debt:

In March 2023, following the announcement of the proposed acquisition of Seagen, Moody’s changed its outlook on our long-term debt to Negative;

S&P downgraded our short-term rating from A-1+ to A-1.

In October 2023, following the announcement of the amended Paxlovid supply agreement with the U.S.

government and updated 2023 guidance, S&P changed its outlook on our long-term debt to Negative.

In December 2023, following the release of 2024 guidance (i) Moody’s downgraded our long-term rating from A1 to A2 and changed its outlook on our long-term debt to Stable and (ii) S&P downgraded our long-term rating from A+ to A and changed its outlook on our long-term debt to Stable.

As of the date of the filing of this Form 10-K, the following ratings have been assigned to our commercial paper and senior unsecured long-term debt:

NAME OF RATING AGENCY Pfizer Short-Term Rating Pfizer Long-Term Rating Outlook/Watch

Moody’s P-1 A1 Stable

S&P A-1+ A+ Stable

A security rating is not a recommendation to buy, sell or hold securities and the rating is subject to revision or withdrawal at any time by the rating organization.

Moody’s P-1 A2

Stable Outlook

These ratings are not a recommendation to buy, sell or hold securities and the ratings are subject to revision or withdrawal at any time by the rating organization.

Each rating should be evaluated independently of any other rating.

Capital Allocation Framework ––Our capital allocation framework is primarily devised to facilitate (i) the achievement of medical breakthroughs through R&D investments and business development activities and (ii) returning capital to shareholders through dividends and share repurchases.

See the Overview of Our Performance, Operating Environment, Strategy and Outlook — Our Business and Strategy section of this MD&A.

Capital Allocation Framework ––Our capital allocation framework is primarily devised to enhance shareholder value and is based on three core pillars:

growing our dividend, reinvesting in the business and making share repurchases after de-levering our balance sheet.

See the Overview of Our Performance, Operating Environment, Strategy and Outlook — O ur Business and Strategy section within MD&A.

Our current and projected dividends provide a return to shareholders while maintaining sufficient capital to invest in growing our business.

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While the dividend level remains a decision of Pfizer’s BOD and will continue to be evaluated in the context of future business performance, we currently believe that we can support future annual dividend increases, barring significant unforeseen events.

In December 2022, our BOD declared a first-quarter dividend of $0.41 per share, payable on March 3, 2023, to shareholders of record at the close of business on January 27, 2023.

The first-quarter 2023 cash dividend will be our 337th consecutive quarterly dividend.

In the first quarter of 2022, we purchased 39 million shares of our common stock at a cost of $2.0 billion under our publicly announced share purchase plan.

See Note 12 for more information.

At December 31, 2022, our remaining share-purchase authorization was approximately $3.3 billion.

On December 14, 2023, our BOD declared a first-quarter dividend of $0.42 per share, payable on March 1, 2024, to shareholders of record at the close of business on January 26, 2024.

The first-quarter 2024 cash dividend will be our 341st consecutive quarterly dividend.

As of December 31, 2023, our remaining share-purchase authorization was approximately $3.3 billion.

Off-Balance Sheet Arrangements, Contractual, and Other Obligations ––In the ordinary course of business, (i) we enter into off-balance sheet arrangements that may result in contractual and other obligations and (ii) in connection with the sale of assets and businesses and other transactions, we often indemnify our counterparties against certain liabilities that may arise in connection with the transaction or that are related to events and activities.

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• Certain commitments totaling $5.2 billion, of which an estimated $1.3 billion is to be paid in the next twelve months, and $3.9 billion in periods thereafter (see Note 16C );

• Purchases of property plant and equipment (see Note 9 ).

In 2023, we expect to spend approximately $3.9 billion on property, plant and equipment;

• Purchases of PP&E (see Note 9 ).

In 2024, we expect to spend approximately $3.7 billion on PP&E;

• Future minimum rental commitments under non-cancelable operating leases (see Note 15 ).

In March 2022, in connection with GSK’s previously announced planned demerger, the Consumer Healthcare JV issued notes of $8.75 billion, €2.35 billion and £700 million with various maturities.

GSK guaranteed the notes and we agreed to indemnify GSK for 32% of any amount payable by GSK.

In conjunction with the completion of GSK’s demerger transactions in July 2022, GSK’s guarantee and our related indemnification of GSK’s guarantee were terminated.

See Note 2C .

Global Economic Conditions ––Venezuela and Argentina operations, and beginning in our second quarter of 2022, our operations in Turkey function in a hyperinflationary economy.

Global Economic Conditions ––Venezuela, Argentina and Turkey operations function in a hyperinflationary economy.

The impact to Pfizer is not considered material.

For additional information on the global economic environment, see the Item 1A.

Risk Factors––Global Operations section in this Form 10-K.

See the Item 1A.

Risk Factors––Global Operations section.

Market Risk ––We are subject to foreign exchange risk, interest rate risk, and equity price risk.

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For more information on how we manage our foreign exchange and interest rate risks, see Notes 1F and 7E , as well as the Item 1A.

Risk Factors—Global Operations section in this Form 10-K for key currencies in which we operate.

Risk Factors—Global Operations section for key currencies in which we operate.

Our sensitivity analyses of such risks are discussed below.

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dollar would not have any effect on another currency’s rates relative to the U.S.

dollar, if the dollar were to appreciate against all other currencies by 10%, as of December 31, 2022, the expected adverse impact on our net income would not be significant.

dollar, if the dollar were to move against all other currencies by 10%, as of December 31, 2023, the expected impact on our net income would not be significant.

Interest Rate Risk —The fair values of our financial instrument holdings are analyzed at year-end to determine their sensitivity to interest rate changes.

In this analysis, holding all other assumptions constant and assuming a parallel shift in the interest rate curve for all maturities and for all instruments, if there were a one hundred basis point decrease in interest rates as of December 31, 2022, the expected adverse impact on our net income would not be significant.

2022 Form 10-K 43

Equity Price Risk ––We hold equity securities with readily determinable fair values in life science companies as a result of certain business development transactions.

In this analysis, holding all other assumptions constant and assuming a parallel shift in the interest rate curve for all maturities and for all instruments, if there were a one hundred basis point change in interest rates as of December 31, 2023, the expected impact on our net income would not be significant.

Equity Price Risk ––We hold long-term investments in equity securities with readily determinable fair values in life science companies as a result of certain business development transactions (see Note 7B ).

While we are holding such securities, we are subject to equity price risk, and this may increase the volatility of our income in future periods due to changes in the fair value of equity investments.

From time to time, we will sell such equity securities based on our business considerations, which may include limiting our price risk.

From time to time, we will sell

2023 Form 10-K

such equity securities based on our business considerations, which may include limiting our price risk.

Our equity securities with readily determinable fair values are analyzed at year-end to determine their sensitivity to equity price rate changes.

In this sensitivity analysis, the expected adverse impact on our net income would not be significant.

LIBOR ––From time to time, we issued variable rate debt or entered into interest rate derivatives based on LIBOR.

The most commonly used U.S.

dollar LIBOR rates will cease publication after June 30, 2023, and all other LIBOR rates ceased publication as of December 31, 2021.

Federal Reserve has selected the Secured Overnight Funding Rate (SOFR) as the preferred alternative reference rate.

We have been updating our systems and all of our LIBOR-based contracts as of December 31, 2022 contain fallback language to accommodate an alternative reference rate.

We do not expect the transition to have a significant impact on our business or financial condition.

In this sensitivity analysis, the expected impact on our net income would not be significant.

NEW ACCOUNTING STANDARDS

Recently Adopted Accounting Standard

Recently Adopted Accounting Standards

See Note 1B .

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Standard/Description Effective Date Effect on the Financial Statements

Reference rate reform provides temporary optional expedients and exceptions to the guidance for contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued after 2021 because of reference rate reform.

The new guidance provides the following optional expedients:

Simplify accounting analyses under current U.S.

GAAP for contract modifications.

Simplify the assessment of hedge effectiveness and allow hedging relationships affected by reference rate reform to continue.

Allow a one-time election to sell or transfer debt securities classified as held to maturity that reference a rate affected by reference rate reform.

Elections can be adopted prospectively at any time through December 31, 2024.

We will apply certain of the optional expedients on hedge accounting relationships and related contracts, if necessary.

We do not expect this new guidance to have a material impact on our consolidated financial statements.

In June 2022, the FASB issued final guidance to clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered when measuring fair value.

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January 1, 2024, with early adoption permitted.

We are assessing the impact, but currently do not expect this new guidance to have a material impact on our consolidated financial statements.

In September 2022, the FASB issued final guidance to enhance transparency about an entity’s use of supplier finance programs .

Under the final guidance, the buyer in a supplier finance program is required to disclose information about the key terms of the program, outstanding confirmed amounts as of the end of the period, a rollforward of such amounts during each annual period, and a description of where in the financial statements outstanding amounts are presented.

January 1, 2023, except for the amendment on rollforward information, which is effective January 1, 2024.

The new guidance is consistent with our current policy, and it will not have an impact on our consolidated financial statements.

In November 2023, the FASB issued final guidance to improve transparency of segment disclosures .

The final guidance requires the disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, other segment items by reportable segment and a description of its composition, and requires all current annual disclosures be provided in interim periods.

January 1, 2024 for annual reports and January 1, 2025 for interim reports.

Early adoption is permitted.

This new guidance will result in increased disclosures in the notes to our financial statements.

In December 2023, the FASB issued final guidance to improve income tax disclosures .

The final guidance requires enhanced disclosures primarily related to existing rate reconciliation and income taxes paid information.

January 1, 2025, with early adoption permitted.

This new guidance will result in increased disclosures in the notes to our financial statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis