What's going on?

Drugmaking giant Pfizer reported dwindling sales on Tuesday � but the firm still managed to plow through analysts� expectations.

What does this mean?

Covid-related products brought in more than half of Pfizer�s $100 billion in sales last year, so it�s fair to say the firm�s milking those offerings for all they�re worth. But that�s the thing about cash cows: sooner or later, they run dry � and then you wind up in poor Pfizer�s current predicament. See, demand for its pandemic-punching products took a nosedive last quarter, with sales plummeting around three-quarters from the same time last year. And sure, Pfizer�s Covid antiviral pills took off in China, and non-Covid offerings jumped 5%, but that couldn�t stop a 29% drop in overall sales. Thing is, no one was really expecting much of Pfizer anyway � so the firm managed to beat analysts� ultra-low expectations.

Why should I care?

Zooming in: Pfizer�s plan B.
Investors are still feeling antsy about Pfizer�s future � and the Covid-shaped hole in its revenue has made Pfizer�s stock one of Big Pharma�s worst performers this year. But the company�s planning to ramp up product launches to fix that, pumping billions into both research and dealmaking. Its $43 billion purchase of Seagen � a cancer treatment firm � back in March seems like a step in the right direction, but there�s still a long road ahead.�

The bigger picture: Sector-wide shakeup.
Pfizer isn�t the only pharma giant trying to find some new moneymakers. Last week a whole host of drugmakers, including AstraZeneca and Merck, said that expiring patents and growing competition were spurring them to spend on acquisitions and research. And smaller US biotech firms could be prime targets. After all, their valuations are well below their pandemic peaks � and with the upstarts� top debt providers hitting the brakes on funding, the small fry might have little choice but to cozy up to the big fish.