Published - June 30, 2022 @ 12:33 PM (EET)

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As the first company to introduce a COVID-19 vaccine, the pharmaceutical behemoth Pfizer (NYSE:PFE) in partnership with BioNTech, said Wednesday they had signed a $3.2 billion deal with the U.S. government for 105 million doses of their vaccine.

The deal would provide supplies for the federal government's planned fall booster campaign, which officials are preparing to fight a potential wave in cases.  

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Under this agreement, the government also has the option to purchase up to 195 million additional doses.

According to a statement from the companies, deliveries are planned to begin as soon as late summer and continue into the fourth quarter.  Payment will occur after the supply is delivered.

Earlier this month, the Biden administration was unable to line up more COVID-19 funding from Congress, forcing it to reallocate $10 billion of existing funding to pay for additional vaccines and treatments.

Earlier, Pfizer forecast COVID-19 vaccine sales of $32 billion for the year, while analysts, on average, are expecting around $33.6 billion.

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ANALYSTS' OPINION

On Tuesday, 28 June, the Food and Drug Administration's panel of independent vaccine experts voted 19 to 2 to recommend a new batch of COVID-19 booster shots targeting the omicron variant.

Following the news, Bank of America analyst Geoff Meacham said the FDA ruling is likely not a significant turnabout for Pfizer.  

"We do not see the booster market as a significant growth driver for the company, as we believe vaccine revenues will continue to decline as COVID-19 moves into an endemic phase," Meacham said.

While each additional round of booster shots and FDA recommendations is good news for vaccine makers, much of these vaccine sales are already priced into the stocks, says Benzinga reporters.  

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In addition, analysts seem to diminish returns on COVID-19 sales in the year ahead.

Bank of America maintains a Neutral rating and $254 price target for BioNTech and a Buy rating and $70 target for Pfizer.

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