As Pfizer (PFE) continues its ongoing battle with activist investor Starboard Value, Goldman Sachs senior biotechnology analyst in global investment research Chris Shibutani joins the Morning Brief to discuss how it may weigh on the company's outlook.

The pharmaceutical giant beat third quarter earnings results with revenue growing 23% year-over-year to $17.7 billion.

One of the major issues Starboard Value has been critical of is Pfizer's spending. Shibutani explains: "I think the COVID-complex revenue trajectory gave them tremendous access to resources. And with that, they were able to apply that to thinking about how to rebuild the post-COVID revenue profile for the company."

Pfizer went forward with mergers and acquisitions, which had varying degrees of success. "That return on investment component is what is, I think, being questioned on terms of the overall operating expense profile," he tells Yahoo Finance.

Shibutani adds, "The company has been very actively engaged in a clearly announced cost realignment program, and we're seeing those results over the last several quarters now where the operating expense levels, spending on SI&A (selling, informational, and administrative) and R&D (research and development) has come in below expectations. So it's a combination of factors here."

Starboard Value has also questioned Chairman and CEO Albert Bourla's role, advocating for his replacement. Bourla recently gained the support of former Pfizer CEO Ian Read and former CFO Frank D'Amelio, according to a statement published by Guggenheim Securities earlier this month.

Shibutani believes that the bigger deal is the successor Dr. Mikael Dolsten, the president of Pfizer's research and development:

"At the end of the day, biopharma, the industry is driven by innovation. The point person there who can play a very important role in being a voice and strategist of defining the pipeline and the growth outlook, I think is going to be essential."

Watch the video above to hear about the role of research and development when it comes to Pfizer's weight-loss drugs. Shibutani also weighs in on Pfizer's future earnings in its post-pandemic era.

To watch more expert insights and analysis on the latest market action, check out more Morning Brief here.

This post was written by Melanie Riehl