Tags: Pfizer | earnings | profit | drugs

Pfizer's Profit Falls 14% as Lipitor Sales Plunge Due to Generic Rival

Thursday, 01 Nov 2012 07:33 AM

Drug giant Pfizer Inc. said Thursday that its third-quarter profit fell 14 percent as sales plunged, mainly due to U.S. generic competition to cholesterol fighter Lipitor, long the world's top-selling drug.

Sales of Lipitor, which is still under patent in some other countries, dropped 71 percent to $749 million.

It had plenty of company: Sales for more than two-thirds of Pfizer's medicines declined, most by 10 percent or more and mainly because of generic competition.

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But even Prevnar 13, a shot against ear infections, deadly meningitis and other bacterial diseases that is the top-selling vaccine in history, saw sales fall by 12 percent, to $868 million. It's still protected by patents, so the drop could indicate that sales have hit a wall as most children in developing countries have already been vaccinated.

The New York-based maker of pain reliever Lyrica said net income was $3.21 billion, or 43 cents per share. That was down from $3.74 billion, or 48 cents per share, a year earlier.

Excluding one-time items, earnings were 53 cents per share. Analysts expected 52 cents.

Revenue fell 16 percent to $13.98 billion, well below expectations for $14.66 billion.

Revenue from prescription drugs dropped 18 percent, to $12.12 billion, as four of its five segments fared poorly. Sales were down sharply for primary care and specialty care medicines and down by a percent or two for cancer drugs and drugs sold in emerging markets such as China and India. Only the established products business, which sells popular but off-patent medicines, saw sales rise, by 7 percent to $2.4 billion.

Lipitor, which once brought in as much as $13 billion a year, got generic competition on Nov. 30, 2012. Pfizer slowed defections while it had limited, slightly cheaper generic competition through May, with big rebates to insurers and $4 copayment offers for most patients staying on Lipitor. But prices plunged when multiple generics hit the market at the end of May. Pfizer then ended the insurer rebates and most patients switched to generics.

Sales of consumer health products increased 2 percent to $780 million, while veterinary medicine sales fell by 2 percent to $1.02 billion.

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Despite the lower sales, Pfizer raised its 2012 profit forecast, to $1.30 to $1.38 per share, from $1.21 to $1.36 per share. But the company reduced the top end of its revenue forecast by $1 billion. The new forecast is for $58 billion to $59 billion.

The company noted its board of directors has authorized a new $10 billion share repurchase program that's to start when Pfizer completes the pending sale of its nutrition business for $11.85 billion to Swiss food and drink giant Nestle SA. That's expected to happen in the first half of next year.

Pfizer's stock fell 32 cents, or 1.3 percent, at $24.55 in premarket trading.

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Drug giant Pfizer Inc. says its third-quarter profit fell 14 percent as sales plunged, mainly due to U.S. generic competition to cholesterol fighter Lipitor, long the world's top-selling drug.The maker of pain reliever Lyrica says net income was $3.21 billion, or 43 cents...
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Thursday, 01 Nov 2012 07:33 AM
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