Pfizer Inc. (NYSE:PFE) saw its shares rise 2.1% to $24.37 in late trading on Thursday, outperforming the broader market but lagging behind other major pharmaceutical stocks. The gain came amid a mixed session for the healthcare sector, with the Health Care Select Sector SPDR Fund (NYSEARCA:XLV) advancing 2.3%, while the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) slipped 0.3%.
Dividend Yield Remains a Key Attraction
Pfizer's quarterly dividend of $0.43 per share, set on June 24 for payment on September 1 to shareholders of record by July 24, translates to an annualized yield of approximately 7.1% at the current share price. This high yield continues to be a primary support for the stock, which trades more like a recovery play than a growth story. The company's market capitalization stands at $139.7 billion.
China Clinical Trial Under Scrutiny
However, a new political risk has emerged. The U.S. House Select Committee on China sent a letter to Pfizer CEO Albert Bourla, demanding details on the company's clinical drug trials in China. According to the committee, public records indicate Pfizer has sponsored at least six trials in Xinjiang and at least 43 involving Chinese military medical centers. The committee has set a July 17 deadline for Pfizer and other pharmaceutical firms, including Merck & Co. (NYSE:MRK), AbbVie (NYSE:ABBV), Eli Lilly (NYSE:LLY), and Bristol Myers Squibb (NYSE:BMY), to provide information on due diligence, data protection, and trial standards at their Chinese sites. Pfizer confirmed receipt of the letter but declined further comment, as reported by Reuters.
This inquiry is significant for Pfizer, which has increasingly relied on China for faster and cheaper drug development. Alexandre de Germay, Pfizer's chief international commercial officer, noted last week that 40% of global oncology clinical studies are conducted in China, where development can be three times faster and cost about half of what it does in Europe. If U.S. scrutiny leads to restrictions on Chinese trial sites or data, it could disrupt one of Pfizer's key strategies to offset declining COVID-19 product sales and upcoming patent expirations.
Financial Outlook and Pipeline
Pfizer has maintained its 2026 revenue forecast of $59.5 billion to $62.5 billion and adjusted earnings guidance of $2.80 to $3.00 per share. First-quarter revenue of $14.45 billion exceeded expectations. Analysts remain cautiously optimistic. J.P. Morgan's Chris Schott noted that pipeline potential could make the story more interesting over time, while RBC Capital's Trung Huynh described Pfizer as a catalyst story rather than an earnings story.
On the regulatory front, the FDA on June 24 approved a new use for Pfizer's breast cancer drug Ibrance, in combination with trastuzumab and endocrine therapy, for maintenance treatment of adults with HR-positive, HER2-positive advanced or metastatic breast cancer. The approval was based on PATINA trial data showing a 24% reduction in the risk of disease progression.
Despite the positive dividend and pipeline developments, Pfizer's stock performance on Thursday trailed its peers. AbbVie rose 3.4%, Merck gained 2.7%, Bristol Myers advanced 2.6%, and Eli Lilly added 1.0%. The broader health care ETF also outperformed Pfizer, indicating that the company's recovery is not yet fully convincing investors.
