Pfizer has been forced to rein in its profit expectations for 2005 after increased competition to its flagship cholesterol-lowering drug, Lipitor (atorvastatin), added to the burden of coping with the pressures facing its COX-2 inhibitor franchise.
The world number one drugmaker said 2005 could be down as much as 9.4%, and it has also withdrawn its forecasts of double-digit profit growth in 2006 and 2007. In a conference call, Pfizer CEO Hank McKinnell said he could not predict when sales and profit might begin to grow again.
Pfizer reported a 5% decline in third-quarter revenues yesterday to $12.2 billion dollars, with its human health division faring even worse, dropping 7% to $10.5 billion. And net income too took a turn for the worse, more than halving to $1.6 billion from $3.3 billion for the third quarter last year.
Sales of Pfizer’s COX-2 inhibitors were hit hard in the fallout of Merck & Co’s withdrawal of Vioxx (rofecoxib) on safety grounds last year. Pfizer’s Celebrex (celecoxib) is facing its own regulatory difficulties, while the withdrawal of follow-up compound, Bextra (valdecoxib) [[08/04/05a]], led the franchise sales into a two-thirds decline to $754 million.
This was coupled with a 4% decline in sales of its impotence drug Viagra (sildenafil) to $384 million, which is seeing competition from Lilly ICOS’ Cialis (tadalafil) and Bayer/GlaxoSmithKline’s Levitra (vardenafil). But perhaps even more worrisome was a slowdown in sales growth for Lipitor. The world’s top-selling medicine brought in $2.9 billion in third quarter revenues, up 6%, but the gain was much less than the 22% increase seen in Pfizer’s interim results statement [[21/07/05b]].
Analysts suggested that Lipitor was coming under pressure from newer products in the cholesterol-lowering category, notably Merck & Co and Schering-Plough’s Vytorin (ezetimibe/simvastatin). Meanwhile, the entire category is facing a shake-up after Merck’s big-selling statin, Zocor (simvastatin), loses patent protection in the USA in June 2006.
Adding to the bleak outlook, Pfizer is also facing generic competition soon on other big sellers including the epilepsy drug, Neurontin (gabapentin), the antibiotic Zithromax (azithromycin), antidepressant Zoloft (sertraline), antihypertensive Norvasc (amlodipine) and Zyrtec (cetirizine) for allergies.
Neurontin, which has already lost patent protection, saw its sales plunge by 80% to $155 million.
Meanwhile, Pfizer has also suffered disappointments in its late-stage pipeline for products that could have helped offset its revenue declines. Last month, the US Food and Drug Administration rejected two of its drugs: Dynastat (parecoxib), an injectable COX-2 inhibitor, and Oporia (lasofoxifene), an osteoporosis treatment [[21/09/05b]] [[14/09/05b]].
The shaky outlook for Pfizer weighed heavily on the firm’s share price yesterday, which closed down 8.5% to $21.90, the lowest level since December 1997.