Pfizer’s earnings fell by 48% in the second-quarter on the back of generic competition for its Zoloft (sertraline hydrochloride) and Norvasc (amlodipine besylate) drugs and sluggish sales of its top-selling cholesterol drug Lipitor. Collaborative payments to Bristol Myers-Squibb for the commercialisation of cardiovascular drug apixaban also contributed to Pfizer’s slide in net income to $1.27 billion.
Lipitor (atorvastatin) sales failed to meet company expectations, with a 5% growth in the international markets being more than offset by a 25% decline in the US. Around half of the revenue losses in the US are accounted for by changes in wholesaler inventory levels and differences in reconciliation of internal and external data.
CEO Jeffrey Kindler noted: “Lipitor… did not meet our expectations for the quarter. We have incorporated a moderation in the level of decline of prescriptions in the US market relative to the second quarter, reflecting extensive promotional and contracting efforts. In addition, we have incorporated an increase in the level of contracting rebates consistent with our current, more flexible contracting policy. We now expect full-year 2007 global Lipitor revenues of flat to 5% decline relative to the prior year.”
Pfizer revenues were also hurt by reduced demand for the blood pressure drug Norvasc and the antidepressant Zoloft, both of which were hit by generic competition following patent expiry. Norvasc saw sales decrease 45% to $642 million, while Zoloft sales plunged 82% to $127 million compared with the same period the previous year.
On the plus side, the company’s innovative medicines Chantix (varenicline), Sutent (sunitinib) and Lyrica (pregabalin) all delivered better-than-expected results.
Still on track
“While there’s no question that we faced difficult challenges in the second quarter… we’re still on track to meet our previously announced 2007 and 2008 revenue and adjusted diluted earnings per share goals,” said Kindler.
The company’s intention to reduce its costs between 2006 and 2008 by £1.5 billion is also showing results, according to Kindler. The 20% reduction in its US fieldforce was completed by April and productivity per representative is said to have returned to pre-restructuring levels. In addition, Pfizer has reduced its global workforce by 8% so far this year, and has cut its global manufacturing plants to 60, from 93 four years ago.