Pfizer Inc. (PFE) Earnings Call Transcript & Summary

Hello, and welcome to Pfizer's 2022 Annual Meeting of Shareholders. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Margaret Madden, Pfizer's Corporate Secretary. Ms. Madden, please begin.

Good morning. I am Maggie Madden, Pfizer's Corporate Secretary. Welcome to this year's Annual Meeting of Shareholders. Today's meeting will be in a virtual-only format. I am joined today by Albert Bourla, Pfizer's Chairman and Chief Executive Officer; Pfizer's Executive Leadership Team and the Board of Directors. We also have the Inspector of Election with us, John Laino and Catherine Ladyzinski, from Computershare participating by phone. In order to make sure we have fair play for all shareholders, it is important that you abide by the rules of our meeting, detailed in the rules of conduct and meeting procedures available on the virtual meeting website. For additional information on these factors, I refer you to the Item 1A Risk Factors and forward-looking information and factors that may affect future results sections in our latest annual report on Form 10-K, which is filed with the U.S. Securities and Exchange Commission and also included as an appendix to our 2022 proxy statement and accessible via www.pfizer.com. These forward-looking statements speak only as to the date of this meeting, and we undertake no obligation to update or revise any of these statements. Now please join me in welcoming Pfizer's Chairman of the Board and Chief Executive Officer, Albert Bourla.

Thank you, Maggie. Good morning, everyone, and welcome to this year's annual meeting. As Maggie mentioned, today's meeting, once again, is being held in a virtual-only format, and I want to thank everyone who helped prepare the logistics for this event. We are joined here today by Pfizer's Board of Directors, which I will introduce to you later in the meeting. We are also joined by members of our executive leadership team, including 3 new members since last year's meeting: Aamir Malik, Chief Business Innovation Officer and Executive Vice President; Michael McDermott, Chief Global Supply Officer and Executive Vice President; and Dr. William Pao, Chief Development Officer and Executive Vice President. I would like to ask the ELT to please stand as a group. Thank you very much. I also want to take a moment to acknowledge and thank Frank D'Amelio, Pfizer's Chief Financial Officer and Executive Vice President, for his long and distinguished career at Pfizer. Frank is retiring later this year, after a notable 15-year career at Pfizer, and we wish him the very best. David Denton will join Pfizer as Chief Financial Officer, Executive Vice President, effective May 2, 2022. 2021 was a year in which Pfizer set up all-time highs in all major areas of focus for our company. We reached an estimated 1.4 billion patients with our medicines and vaccines, that's roughly 1 out of every 6 people on earth. We initiated 13 pivotal clinical studies, the highest number ever for Pfizer. And we grew revenues to $81.3 billion. During the year, we also continued to lead the battle against COVID-19. Throughout 2021, in collaboration with BioNTech, we brought our COVID-19 vaccine to more populations and further ramped up our manufacturing and distribution capabilities. To date, nearly 3.4 billion doses of our vaccine have been distributed in 179 countries. Late in the year, our breakthrough oral treatment, Paxlovid, became the first oral treatment for COVID-19 to receive an emergency use authorization from the U.S. Food and Drug Administration. To date, Paxlovid has received emergency or conditional authorization for use with certain populations in more than 60 countries. The success of our COVID-19 vaccine and treatment programs has not only made a positive difference in the world, I believe it has fundamentally changed our company and our culture forever. Colleagues across Pfizer are inspired by our achievements and more determined than ever to be part of the next breakthrough. Our COVID-19 leadership also has fundamentally changed the way Pfizer is perceived externally, by shining a light on the tremendous volume our science can bring to society. As a result, for the first time ever, Pfizer ranked 1st among big pharma companies in the PatientView Global Survey in 2021. As recently as 2018, we were ranked 5th, and we have steadily climbed in the ranking ever since. And earlier this year, Fortune ranked us 4th on its annual World's Most Admired Companies list, the highest ranking we have ever achieved. While so much focus had been on our COVID-19 programs, we have never lost sight of the needs of other patients who needs are no less urgent. In fact, we are applying the light-speed principles developed for our COVID-19 work to other therapeutic areas to help ensure we continue to move at the speed of science for the benefit of all our patients. In 2021, we continued to meet these patients' needs with product approvals across a wide range of therapeutic areas, including various forms of cancer, inflammatory conditions, cardiovascular disease, women's health and pneumococcal disease. During 2021, we also further enhanced our commitment to environmental, social and governance principles. I would like to share a few examples. First, Pfizer is dedicated to becoming carbon neutral across our internal operations by the year 2030. And our fourth generation greenhouse emission reduction targets, approved by the science-based targets initiative, are aligned with a 1.5 degrees trajectory. We are committed to reducing by 2030 Scope 1 and Scope 2 greenhouse gas emissions by 46% from a 2019 baseline, sourcing 80% purchased renewable electricity by 2025 and 100% by the year 2030, and working to accelerate change across our supply chain, driving 64% of our suppliers of goods and services by spend to also set science-based greenhouse gas emission reduction goals. Second, Pfizer has made significant progress in diversifying our colleagues base, particularly at more senior level positions. For example, we have increased the percentage of women at the VP level and above globally from 32.3% at the end of 2018 to 41.5% at the end of 2021. Over the same time frame, we have increased the percentage of minorities at the VP level and above in the U.S. from 18.8% to 25%. We are also committed to achieving racially and ethnically diverse participation in all our clinical trials. And in 2021, we published an industry-first retrospective analysis of demographic data of U.S. participants in 213 of our investigational clinical trials that initiated enrollment from 2011 through the year 2020, during this almost 10 years. Third, we continue to make progress in helping to ensure our COVID-19 vaccine and oral treatment are accessible by everyone, everywhere. I'm thrilled to say that we remain on track to meet or exceed our goal of delivering at least 2 billion doses of our vaccine to low- and middle-income countries by the end of 2022. In terms of our oral COVID-19 treatment, we have signed agreements with the Medicines Patent Pool and UNICEF, which we hope will lead the expanded access, pending country regulatory authorization or approval, of course, in 95 low- and middle-income countries, that account for approximately 53% of the world's population. Lastly, I'm pleased to share that beginning this year, we will be linking executive compensation with ESG performance. Looking ahead, Pfizer is well positioned to continue to deliver meaningful value for patients, investors and all stakeholders. This confidence is underpinned by the momentum of our business, the strength of our internal R&D pipeline and our ability to deploy capital into growth-focused business development to access external science. Our business development focus largely will be in the therapeutic areas and platforms where we have the scientific skills and acumen to add substantial value and select the most successful targets. In addition, we feel that we have distinctive attributes, such as world-class excellence in clinical development and unsurpassed manufacturing and commercial capabilities at scale, that make us a very attractive partner for other life sciences companies. 2021 saw Pfizer further cement its standing as a scientific powerhouse capable of taking on the world's most devastating diseases. This wouldn't be possible without the contributions of our amazingly purpose-driven colleagues, who continue to rise to the challenge of addressing the world's most devastating diseases. To each and every one of them, I say, thank you. Thank you for your continued support of our important work. Now it's time to proceed with the business portion of the meeting. We are scheduled to end by approximately 10:00 a.m., and we want to maintain an informative, productive and orderly business meeting, marked by fairness to all shareholders. Therefore, we will allow the order of -- we will follow the order of business available on the virtual meeting website. And we will get right to the first item of business, declaration of quorum. Notice of this meeting was given to all shareholders of record as of March 2, 2022. Shares representing at least 82.4% of the votes entitled to be cast at this meeting are present here today. This percentage represents a quorum. We now move to the next order of business items requiring your vote. We have 8 voting items in all, 3 that we address at every annual meeting and 5 proposals from shareholders. Each item will be open for questions and discussions. To ensure fair play for all shareholders, it is important that you follow the rules of conduct and meeting procedures available on the virtual meeting website. Shareholders will be able to ask questions during the meeting after the presentation of its proposal and during the Q&A period later in the meeting. A telephone number is available to shareholders who enter the virtual meeting website using their control number. We have a lot of business to transact today, and we will reserve the right to move on to other questions or comments if a question or comment is out of order or has been substantially answered previously. In a moment, I will officially open the polls. Please note that if you have entered this meeting using a control number, you can still vote on all of the proposals that are included in the proxy statement, unless you are a participant in a Pfizer savings plan as the voting submission deadline has now passed. If you have not yet voted, but would like to do so, or you have already voted, but would like to change your vote, please use the annual meeting platform to vote your shares. We will pause for a moment to allow for voting. I declare the polls open as of 9:15 a.m., Eastern Day time, on April 28, 2022. The polls will close today following the presentation of the items of business. We now turn to the first voting item, the election of directors. This year, the Board has nominated 12 individuals in all to serve 1-year terms, all ending at the next Annual Meeting of Shareholders. You will find their extensive backgrounds in our proxy statement. In addition to me, the director nominees in item 1 are, and please stand as I call your name: Ronald Blaylock; Susan Desmond-Hellmann; Joseph Echevarria; Scott Gottlieb; Helen Hobbs; Susan Hockfield; Dan Littman; Shantanu Narayen; Susan Nora Johnson; James Quincey; and James Smith. Thank you very much. You may take your seats now. The Board recommends that you vote for all director nominees. If you have any comments or questions concerning this voting item, please access the dial-in information displayed on the meeting platform. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we did not receive any questions on this item.

Thank you, Maggie. Operator, are there any shareholders on the line who would like to ask a question or make a comment concerning any of the nominees?

[Operator Instructions] There are no questions at this time.

Okay. Thank you. We will now move to our next item. Item 2 is to ratify the selection of KPMG LLP as the company's independent registered public accounting firm for the year 2022. Two representatives from KPMG are participating by audio connection with us today, Gregory Brunner and Melissa Taylor. The Audit Committee of the Board of Directors has done a thorough job of reviewing the performance of KPMG in 2021 and has selected the firm as Pfizer's independent registered accounting firm for the year 2022. The Board has ratified this selection and recommends that you vote for this proposal. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we did not receive any questions in advance on this item.

Thank you, operator, the same. Are there any questions or comments on the voting item right now?

[Operator Instructions] There are no questions at this time.

Thank you. We will now move to our next item. Item 3 is a management proposal asking our shareholders to cast an advisory vote to approve the compensation of our company's named executive officers, identified in the summary compensation table in the executive compensation section of the 2022 proxy statement. While this advisory vote is nonbinding, the Compensation Committee and the entire Board of Directors will review the results of the vote. And consistent with Pfizer's record of responsiveness, we will consider the feedback of shareholders and take that feedback into account in future decisions relating to our executive compensation program. Accordingly, for the reasons set forth in the proxy statement, the Board recommends a vote for the resolution to approve on an advisory basis the compensation of the company's named executive officers as stated in the proxy statement. Maggie, are there any questions submit -- were there submitted any questions in advance?

No, Albert. We did not receive any questions in advance.

On this item. And then operator, are there any questions or comments on this voting item now?

[Operator Instructions] There are no questions at this time.

Thank you. We will now move to our next item. This proposal submitted by John Chevedden of Redondo Beach, California requests that our Board of Directors take the steps necessary to enable as many shareholders as may be needed to combine their shares to equal of 3% of our stock owned continuously for 3 years to enable shareholder's proxy access. Mr. Chevedden, you have 3 minutes to move the proposal forward for discussion. Operator, please open the line to Mr. Chevedden.

Hello. This is John Chevedden. Can you hear me okay?

Yes. Very much, sir.

Proposal 4, improve our Catch-22 proxy access. Shareholders request that our Board of Directors take the steps necessary to enable as many shareholders as may be needed to combine their shares to equal 3% of our stock owned continuously for 3 years to enable shareholder proxy access. This proposal addresses the problem with more than 500 major companies bragging about giving their shareholders the right to put their own director candidates on the ballot through the shareholder proxy access process, and not 1 of these 500 companies has ever seen shareholders make use of this right. Clearly, the barrier to entry to this right is much too inflexible for any shareholders to have ever made use of it. What gives us the right of shareholders universally avoid using the right. This proposal would make the proxy access process more flexible in order that shareholders could make use of it. The current arbitrary ration of 20 shareholders to initiate shareholder proxy access can be called Catch-22 Proxy Access. In order to assemble a group of 20 shareholders who have owned 3% of our stock for an unbroken 3 years, one would reasonably need to start with 60 activist shareholders who own 9% of Pfizer stock for an unbroken 3 years because initiating proxy access is a complicated process and is easily susceptible to errors, and one seldom find activist shareholders among the largest shareholders in the company. The 60 activist shareholders could then be whittled down to 40 shareholders because some shareholders would be unable to meet the paper chase requirements and deadlines. After 40 shareholders submit their paperwork to the management, then management might somewhat arbitrarily claim that half had errors, leaving 20 shareholders. But the current rule does not allow 60 shareholders to submit their paperwork to management to end up with 20 qualified shareholders. Management often claims it needs flexibility in doing its job, but it demands rigidity from shareholders in exercising their rights. Management demands rigidity from shareholders in order to diminish their power to have a positive impact on Pfizer. Management should give flexibility to shareholders when a shareholder seek a voice in the strategy of Pfizer. Please vote yes, improve our Catch-22 proxy access, Proposal 4.

Thank you very, very much, sir. The proposal has been moved now. The Board of Directors opposes this proposal for the reasons set forth in the proxy statement. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we did not receive any questions in advance on this item.

And operator, are there any questions or comments on this voting item?

[Operator Instructions] There are no questions at this time.

Now we will -- now move to our next item. The next item is a shareholder proposal submitted by the National Center for Public Policy Research in Washington, D.C. The proposal requests that Pfizer publish an annual report at reasonable expense analyzing the congruency of political and electioneering expenditures during the preceding year against the company's fundamental purpose and publicly stated company values and policies. Mr. Ethan Peck is representing the National Center for Public Policy Research. Mr. Peck is participating via prerecorded audio. Mr. Peck, you have 3 minutes to move the proposal forward for discussion. Please play Mr. Peck's prerecorded remarks.

The Board's empty statement in opposition to our proposal is telling of its corruption and attitude towards shareholders and is all the more reason for shareholders to vote in favor of our proposal. The Board claims that political expenditures are already in alignment with the company's fundamental purpose and that all relevant information is publicly disclosed by Pfizer, but that is false. Our proposal is simple, that Pfizer align its political spending with its fiduciary responsibility and that Pfizer is transparent with shareholders about such spending so that shareholders know that their assets are being reallocated in a way that serves their interest. If the Pfizer Board is so proud of its contributions to social and political causes, then it shouldn't be reluctant to disclose the full nature of such contributions to anyone, let alone the shareholders financing this krone spending spree. Mr. Bourla, why are you so content in using shareholder money to support political causes, but also so reluctant for those same shareholders who are footing the bill to have knowledge of the full extent of such spending? Take, for example, Pfizer's Platinum partnership with the Human Rights Campaign, which is the highest level of corporate sponsorship that HRC offers. This spending is not disclosed by Pfizer to its shareholders in any report, contrary to the fraudulent claims by the Board. HRC is a radical organization, which has lobbied ruthlessly against Florida's anti-grooming legislation. It was HRC who pressured Disney to capitulate to the woke mob against the legislation, and Disney isn't even an HRC sponsor, but Pfizer is. Pfizer is funding this grooming effort, again, with our money, to keep it legal for teachers to be able to talk to kids as young as 4 years old about sex and sexuality. If you are proud of using our money towards this deeply disturbing agenda, then you must be forthright about it. Another example is Pfizer's strategic partnership with the World Economic Forum. That is a higher level of sponsorship that is not disclosed by Pfizer to its shareholders. WEF also dubs Mr. Bourla himself as an agenda contributor. This WEF agenda includes "the Fourth Industrial Revolution and the Internet of bodies". The WEF defined the Fourth Industrial Revolution as "a new chapter in human development, forcing us to rethink what it means to be human." The Internet of bodies is about using devices to connect our bodies together to form an Internet type web of humans. Through Pfizer's sponsorship of the WEF, we are funding this antihuman dystopian vision for the future. Do shareholders know this? The Board also claimed that Pfizer PAC reports are publicly available, but no such reports since 2019 is, why? What about Pfizer PAC spending in 2020 and in 2021? Why isn't that on the site? Seems relevant considering there was a global pandemic, which Pfizer made a vaccine for, the same vaccine that was mandated by the very politicians who Pfizer financially supported. Pfizer shareholders deserve to know how their money is being used to stop on the freedoms of everyday Americans. These are only a few examples of spending not disclosed by Pfizer. Shareholders deserve to be assured that all political spending, down to the cent, is aligned with Pfizer's fiduciary responsibility to its shareholders. We encourage shareholders of all political viewpoints to support our request for transparency and integrity.

Thank you, Mr. Peck. The proposal has been moved. Thank you. The Board of Directors opposes this proposal for the reasons set forth in the proxy statement. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we didn't receive any questions in advance on this item.

Operator, are there any questions or comments on this voting item?

[Operator Instructions] There are no questions at this time.

Thank you. We will now move to our next item. The next shareholder proposal was submitted by Oxfam America Inc. of Boston, Massachusetts and other co-filers. The proposal requests that the Board commissions a third-party report to shareholders at reasonable expense, and omitting confidential and proprietary information, analyzing the feasibility of promptly transferring intellectual property and technical knowledge to facilitate the production of COVID-19 vaccine doses by additional qualified manufacturers located in low- and middle-income countries, as defined by the World Bank. Ady Barkan is representing Oxfam America Inc. and the co-filers and is participating via his prerecorded audio. Mr. Barkan, you have 3 minutes to move your proposal forward for discussion. Please play Mr. Barkan's prerecorded remarks.

Good morning. My name is Ady Barkan. I am the founder of Be a Hero, an organization working to achieve health justice. We believe that people everywhere deserve the health care they need, including access to life-saving coronavirus vaccines. In support of this work, I'm speaking on behalf of a resolution filed by Oxfam America and co-filers, Mercy Investments and Adrian Dominican Sisters. We are in the midst of the greatest public health crisis in 100 years. Despite safe and effective vaccines like Pfizer's, thousands of people are still dying every day because protections against the coronavirus have not been made accessible to all. Billions of people remain unvaccinated in part because Pfizer cannot produce enough doses on its own. And yet, Pfizer refuses to share its technology to boost global manufacturing. The vaccine was made possible by public taxpayer funding and contributions from the global scientific community. But instead of continuing to work together to end the pandemic, Pfizer has chosen to turn its back on the world. Oxfam reports that 1% of Pfizer's vaccine supply was allocated to low-income countries by February, and still 88% of people in low-income countries have not been fully vaccinated. Pfizer is complicit in exacerbating vaccine in equity, but it is not too late for Pfizer to do the right thing. Pfizer can start by sharing its vaccine technology with the World Health Organization's mRNA Hub or any of the more than 100 qualified manufacturers around the world. In the year since the WHO first asked companies like Pfizer to share their technology with its vaccine manufacturing hub, more than 3 million people have died. By some estimates, the true toll could be 3x higher, with most of those deaths in low- and middle-income countries. We need a global approach to ending the pandemic. We've seen how variants that emerged around the world threatened public health everywhere. The global economy lost trillions of dollars in economic value, harming investors and people. We urgently need diversified global manufacturing to provide sustainable, equitable access to vaccines, save more lives, reduce the risk of variants and kickstart economic recovery. Pfizer should not get to decide who lives and who dies. The vaccine came from the best of humanity, and it must return to the world with the same intention with access for all. Pfizer has the opportunity now to become a true industry leader. Together with our 2 co-filers, we urge shareholders to support this proposal that Pfizer analyze the feasibility of transferring technology to facilitate the production of coronavirus vaccines by qualified manufacturers in low- and middle-income countries. Thank you.

Thank you, Mr. Barkan. The proposal has been moved. The Board of Directors opposes this proposal for the reasons set forth in the proxy statement. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we didn't receive any questions in advance on this item.

Operator, are there any questions or comments on this voting item?

[Operator Instructions] There are no questions at this time.

Okay. Thank you. We will now move to our next item. The next shareholder proposal was submitted by the Sisters of St. Francis Charitable Trust, Dubuque, Iowa. The proposal requests that the Board report to shareholders on how it oversees risks related to anticompetitive practices, including whether the full Board or Board committee has oversight responsibility, whether and how consideration of such risks is incorporated into Board deliberations regarding strategy and the Board's role in Pfizer's public policy activities related to such risks. Mr. Christopher Cox is representing the Sisters of St. Francis Charitable Trust and is presenting via a prerecorded video. Mr. Cox, you have 3 minutes to move the proposal forward for discussion. Can you please play Mr. Cox' prerecorded remarks.

Good morning, Dr. Bourla, members of the Board and fellow shareholders. My name is Christopher Cox. And on behalf of the Sisters of St. Francis Charitable Trust, who are members of the Interfaith Center on Corporate Responsibility, I present shareholder proposal #7, which asks our Board to report their shareholders on board oversight of risks related to anticompetitive practices. We know that the Board oversees lots of risk, but we want to understand how the Board oversees risks related to anticompetitive practices. Anticompetitive practices can often push the limits of law and regulation and have drawn significant scrutiny from federal regulators. The proponent believes strategies to expand monopolies through such anticompetitive practices as pay-for-delay, product hopping, evergreening of patents, price inclusion, without any meaningful new science or invention, do not help create long-term value for the company or for shareholders. More importantly, it exacts a heavy cost on health systems and communities. Engaging in such practices presents legal, financial, regulatory and reputational risks that, unmanaged, may threaten the company's social license to operate. We are concerned that these strategic risks are not fully addressed by Pfizer's Board of Directors. The company's opposition statement points to management of these risks by different bodies, but none of that disclosure mentions anticompetitive practices or antitrust risks generally nor does it discuss specific anticompetitive practices, such as product hopping or pay-for-delay agreements. The charters for the audit and regulatory compliance committees assigned responsibility for overseeing numerous specific kinds of risks, but are silent regarding competition-related risks. Likewise, the company points to Pfizer's code of business conduct, such as that Pfizer is "committed to competing fairly and following the antitrust and competition laws of all countries in which we operate." This statement sheds no light on how the Board oversees risks related to anticompetitive practices. The Pfizer Board should be able to demonstrate to shareholders that it has applied rigorous oversight, with clear criteria, expectations and regular review to management decisions about pricing patents and innovation, or their play at vague language about general strategic oversight is not sufficient in light of intensive regulatory scrutiny over practices, both within the U.S. and abroad. This mounting pressure on Pfizer from regulators, enforcers and other market participants regarding anticompetitive practices could increase pressure for new regulation, increased risk for investors and have substantial impacts on the public. Given the widespread concern and rapidly changing environment, we believe that robust Board oversight would improve Pfizer's management of risks related to anticompetitive practices and that shareholders would benefit from more information about the Board's role. We, therefore, urge shareholders to vote for Proposal 7.

Thank you, Mr. Cox. The proposal has been moved. The Board of Directors opposes this proposal for the reasons set forth in the proxy statement. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we didn't receive any questions on this item.

Operator, are there any questions or comments on this voting item?

[Operator Instructions] There are no questions at this time.

Thank you. We will now move to Item 8, which is the next and last voting item. The shareholder proposal submitted by The Shareholder Commons of Wilmington, Delaware, on behalf of the John Bishop Montgomery Trust, asks that the Board of Directors commission and publish a report on: first, the public health costs created by the limited sharing of the company's COVID-19 vaccine technologies and any consequent reduced availability in poorer nations; and second, the manner in which such costs may affect the market returns available to its diversified shareholders. Ms. Sara Murphy is representing The Shareholder Commons and is presenting via prerecorded audio. Ms. Murphy, you have 3 minutes to move the proposal forward for discussion. Please play Ms. Murphy's prerecorded remarks.

I'm Sara Murphy with The Shareholder Commons. Shareholders ask the Board for a report on the public health costs created by Pfizer's limited COVID-19 vaccine technology sharing and any consequent reduced availability in poorer nations and how such costs affect its diversified shareholders' returns. Despite the pleas of more than 100 countries and the President of the United States, Pfizer refuses to waive its COVID-19 vaccine-related intellectual property rights. But while Pfizer is boosting earnings with vaccine sales, many countries struggle to obtain vaccines for their most susceptible communities. The imbalance in COVID-19 vaccination between rich and poor countries is striking. 79% of the U.S. and Canada population has had at least 1 dose compared with just 20% of the African population. Many experts argue that pharmaceutical companies failure to waive their intellectual property rights is exacerbating the COVID-19 pandemic. This has dire consequences for public health and economic growth. Indeed, an inadequate global vaccine supply could lead to global economic losses of up to $9 trillion, and the average country's GDP was reduced by 7.3% in 2020 due to the pandemic. The loss in economic growth caused by an extended pandemic threatens Pfizer's shareholders diversified portfolio. And that threat may outweigh any benefit those shareholders receive from Pfizer incrementally increasing its profitability by exploiting its monopoly power over its intellectual property rights. Fiduciaries and advisers should understand whether their diversified clients and beneficiaries are at risk from Pfizer trading off economic growth for its own financial performance. To the extent, Pfizer is increasing its own financial returns by preventing vaccine production in poorer nations, its own increased profits come at a severe cost to the global economy because failure to vaccinate the world's vulnerable communities is inhibiting worldwide economic recovery and creating opportunities for more dangerous variants to develop. This is a bad trade for most of Pfizer's shareholders who are diversified and thus rely on broad economic growth to achieve their financial objectives. A company's strategy that increases its own financial returns, but threatens global GDP, is counter to the best interests of most of its shareholders. The potential drag on GDP created by hoarding vaccine technology will directly reduce diversified portfolio returns over the long term. And remember, company decision makers are heavily compensated in equity, so they don't share the same broad market risk as Pfizer's diversified shareholders. Voting for will signal that you want to understand whether Pfizer is putting the global economy at risk to improve financial performance. Please vote for item 8.

Thank you, Ms. Murphy. The proposal has been moved. The Board of Directors opposes this proposal for the reasons set forth in the proxy statement. Maggie, were there any questions submitted in advance of today's meeting on this item?

No, Albert, we did not receive any questions in advance.

Operator, are there any questions or comments on this last voting item?

[Operator Instructions] There are no questions at this time.

Thank you. We have concluded the presentation of the items of business. We now move to the next order of business item, final voting and closing the polls. If you would like to vote or change your vote, please submit your vote on the virtual meeting website at this time. Thank you. I now declare the polls officially closed as of 9:44 Eastern Daylight time on April 28, 2022. We now move to the next order of business, the preliminary results of the voting. I will now ask Maggie Madden to provide the inspector's preliminary report on the voting. Maggie?

Thank you, Albert. The inspector's report is preliminary and is subject to the inspector's final tabulation, which should not significantly change the preliminary results. The final results will appear in a Form 8-K filed with the U.S. Securities and Exchange Commission within 4 business days of this annual meeting. The inspector's preliminary report shows that shares representing 82.4% of the votes entitled to be cast at this meeting were represented in person or by proxy constituting a quorum. Proposal 1. The inspector's report further shows that each of the 12 nominees for election as director, named in item 1 of the proxy statement, received a favorable vote of at least 87.4% of the votes cast at this meeting. Proposal 2. The proposal to ratify the selection of KPMG LLP to serve as the independent registered public accounting firm for the company for 2022 received the following votes: 95.6% of the votes cast voted for the proposal, 4.4% of the votes cast voted against the proposal. Proposal 3. The 2022 advisory vote on executive compensation received the following votes: 92.7% of the votes cast voted for the proposal, 7.3% of the votes cast voted against the proposal. Proposal 4. The shareholder proposal regarding amending proxy access received the following votes: 29% of votes cast voted for the proposal, 71% of the votes cast voted against the proposal. Proposal 5. The shareholder proposal regarding a report on political expenditures congruency received the following votes: 10.4% of the votes cast voted for the proposal, 89.6% of the votes cast, voted against the proposal. Proposal 6. The shareholder proposal regarding a report on transfer of intellectual property to potential COVID-19 vaccine manufacturers received the following vote: 27.3% of the votes cast voted for the proposal, 72.7% of the votes cast voted against the proposal. Proposal 7. The shareholder proposal regarding a report on Board oversight of the risks related to anticompetitive practices received the following votes: 30.5% of the votes cast voted for the proposal, 69.5% of the votes cast voted against the proposal. Proposal 8. The shareholder proposal regarding a report on the public health cost of protecting vaccine technology received the following votes: 9.1% of the votes cast voted for the proposal, 90.9% of the votes cast voted against the proposal. The results of this preliminary report indicate that the shareholders of the company have elected all nominees for the Board of Directors as named in the proxy statement, have approved the proposal regarding ratification of the selection of our independent registered public accounting firm for the 2022 fiscal year, have approved on an advisory basis the compensation of our named executive officers and have not approved the 5 shareholder proposals. This concludes the inspector's report.

Thank you, Maggie. We now move to the next order of business. Having completed the voting items and reported on the voting, we welcome questions from our shareholders via telephone. [Operator Instructions] We now have approximately 15 minutes set aside for general questions and comments. We will follow the rules of conduct and meeting procedures for the handling of your questions. We will make every effort to answer all questions in the time allowed. However, if multiple questions were submitted in advance of the same topic, those questions may be grouped and answered collectively. If more questions are presented at line -- the time permits to be answered, unanswered pertinent questions and responses will be posted on the company's website. We ask that you please focus your questions on an issue of general importance to shareholders and limit to no more than 2 minutes. Also in the interest of fair play to all shareholders, if a question has already been substantially answered, we will move on to another shareholder question. Maggie, before we open the phone line, did you receive any questions in advance of today's meeting?

Yes, Albert. We received a few questions in advance, and we'll start with 2 of the pre-submitted questions, then turn to the live questions.

Thank you.

The first question was submitted by Raymond Masari and asks, in making $24 billion in 2021, why are you raising the dividend only $0.01, while other pharma companies such as Eli Lilly, Bristol-Myers, are raising theirs by significantly more?

Thank you for your question. The Board and the executive team tries to manage the capital of the company in the best interest of achieving our purpose, which is breakthroughs that change patients' lives, and as a result, returning shareholder significant returns. We maintain flexibility on the ways that we allocate our capital, but we are changing based on Board decisions very frequently. Right now, our growing dividend is an important part of our investment thesis. And this is why we group the dividend, and we delivered $8.7 billion in the form of dividends to shareholders. We do, though, think that there are other uses also of capital that they may serve better the shareholders, depends on the circumstances. For example, we want to invest in business development activities, allowing us to source external science that, in our hands, can be developed fast, can be manufactured at scale and with good quality and provide benefits to society, to patients and as a result to the shareholders. The same is we can do share repurchases when we feel that this is appropriate. So in essence, we do not have -- we have flexibility, and the Board is making the decisions to allocate the capital as we see the dynamics of the U.S. economy, of the global economy evolving. Let's move to the next question.

The next question was submitted by Salvatore Sansotta from DWS Investment GmbH and asks, what steps is Pfizer taking to promote diversity throughout the organization?

Thank you very much for your question. And we are, first of all, thinking that diversity, it is a very big responsibility of our company. And we are taking active measures to make sure that we are increasing the diversity of our employee population. You heard before in my remarks that we are extremely proud of the progress that we have achieved so far. Women, for example, in 2019, we had 33% in Vice Presidents and higher positions in the company. And as of now, we have increased 33% to 42%. The same is with minorities. In 2019, we had 19% of people in the U.S. in positions Vice President and higher, that were self-identified as minorities. Today, this 19% is 35% -- it is 25%. Of course, we have set even more ambitious goals. And right now, our goals for 2025, it is to reach 47% of women in VP and above from 42% that we are right now and 32% of minorities from 25%, that we are now. We are -- given the progress that we have done so far, I'm very optimistic that we will achieve those aggressive, but rightly so set targets. Thank you. Let's move to the next question.

Albert, we're now going to move to live questions. We're going to move to live questions. Operator?

All right. Thank you. Operator, now we're ready to take live questions. Please open the phone line and announce the name of the shareholder.

[Operator Instructions] There are no questions at this time.

We have one final.

Let's wait for one -- yes, let's wait for a moment to see if there is any question. Operator, are there any questions pending?

There are currently no questions at this time.

Okay.

We have 1 pre -- one more pre-submitted...

So Maggie, then, please present the final pre-submitted question.

Thank you, Albert. The final question was submitted by Cathy Rowan from Trinity Health and Interfaith Center on Corporate Responsibility, and comments, according to the World Bank, by the end of 2022, the world will be at best half recovered from COVID-19 pandemic. Perhaps the single most important reason for the unequal recovery is unequal access to COVID-19 vaccines and treatments. Pfizer recently signed an agreement with the Medicines Patent Pool to facilitate access in a number of low- and middle-income countries to its COVID-19 medicine, Paxlovid, by enabling the development of generic versions. This is an important move, but will take time to implement. Will Pfizer commit now to an equitable distribution of Paxlovid in low- and middle-income countries? Will the company expand the licensing agreement to include all low- and middle-income countries?

Thank you for your question and comment. Although we provided some elements that could answer your question, I want to make some further comments because that's an important element. Equity, it is one of the four core values of Pfizer, and we take it extremely seriously. This is what we did in the vaccine, and this is what we do also in the treatment right now. When we started with the vaccine, for example, we knew that there would be 2 major challenges to ensure equitable distribution of our vaccine. The first was the price. We needed to make sure that the vaccine is affordable to all. Everybody has price that can afford to pay it. That's why we assign a tier pricing because we believe that equity is not giving everyone the same. Equity is giving more to those that need more. The high-income countries receive the price that was at the range of a takeaway meal. But the middle-income countries received half of this cost and the low-income countries received a price that was a not-for profit. The same exactly principle of tier pricing, we did when we brought to the world our Paxlovid treatment. In addition to that, through our agreement with the U.S. government and through agreements with European Union and other countries, we made available hundreds of millions of doses that are completely free right now for these countries. As the U.S. government is buying at asset cost, so we don't make money, but also we're not losing money, but they are giving completely for free to those that are in need. Right now, the U.S. government has 800 million doses in their hands that they are offering for free to all countries in that, they are -- in the low income or lower middle-income status. The second thing, of course, that we wanted to make sure, it is that we have enough quantities for all, not only the price. To that, I think we did tremendously well. Just to give you an order of the magnitude, the annual capacity of Pfizer was 200 million doses before the pandemic. This was across all our vaccines and across all our manufacturing sites in the world. In the first year of the pandemic, we made 3 billion doses of a vaccine that was first produced. And we are going to make 120 million treatments for a treatment that was not produced before. In addition to that, we signed an agreement with the Patent Medicines Pool -- Medicines Patent Pool, that we are providing royalty-free, all license to every qualified manufacturer that was selected by the Medicines Patent Pool to sell those products in 95 different countries, which includes 53% of the world's population. I repeat, for 53% of the world's population, we are providing license completely for free. We are also knowing that it will take time for the generic manufacturers to ramp up their manufacturing capabilities so that they can provide product to those countries. For this reason, we just signed an agreement with UNICEF, where we provide to UNICEF 4 million doses for a not-for-profit price, so that to cover the gap between now and when the generic companies will be ready to provide to these countries enough products. So as you can see, in terms of cost and in terms of availability, we have plenty of vaccines and we have plenty of treatments right now to the world, thanks largely to our efforts and the efforts of donors around the world. However, we have a very low utilization, unfortunately, and that reveals the real issue of what equity means. Those countries, although they are offered hundreds of millions of free vaccines, they cannot absorb them because right now, they do not have, from, one, the appropriate infrastructure to do vaccinations, but also they have tremendous high numbers of skeptic to vaccinations and treatments, and they have a lot of hesitance. So I think in order to achieve equitable treatment of all, I think the efforts are not anymore as to not focus on availability or cost because, as I said, we have hundreds of millions of doses offered for free, they should focus on infrastructure and helping those countries to build their systems so that they can vaccinate their people, convert vaccines to vaccinations and treatments -- and diagnosis to treatments. So thank you for your question. And now let's move to the last order of business, which is the adjournment.

If your questions weren't answered...

Okay. Yes, please. If you have a question, although we did not -- that was not answered at today's meeting, you may submit your question on the virtual meeting platform, which will be open until 11:00 a.m. Eastern Daylight Time. We will post the answers to all unanswered pertinent questions on our website. We now move to our last order of business, which is the adjournment. And we are about to adjourn. But before we do, I would like to thank everyone who worked on this meeting, both Pfizer colleagues and our valued business partners. It has been our pleasure to be able to conduct our Annual Meeting of Shareholders virtually today. This has been a valuable meeting. We appreciate the opportunity to listen and learn from our shareholders, speaking for all of us in executive leadership and on our Board. I'm grateful for your continued confidence in Pfizer and for your continued interest in the progress of our company. Please stay safe and healthy. With that, the meeting is adjourned.