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PFE announced better than expected Q2 earnings, but revenue and profits were both down from the year before. Revenues fell 9% to $10.98B, partially from adverse FX conditions, and income fell 19% to $2.26B.
Pfizer's Q1 revenue and earnings fell 10% and 2% respectively. The revenue drop was largely in line with analysts' expectations, though the profit drop was a little better than expected.
Previously, there was no mechanism for generic biologic drugs to be approved - which meant companies like Pfizer don't face generic competition. But Obama's budget proposes to change that.
Genentech, boosted by a buyout offer from Roche, surpassed Pfizer in market value. On Friday, Genentech was valued at $90 billion while Pfizer was valued at $84 billion.
Pfizer dropped two drugs from late-stage development after clinical data showed that both were not more effective than existing treatments. The two drugs are the fibromyalgia drug esreboxetine and an anxiety disorder drug known as PD. Both drugs may have generated more than $1 billion in annual sales if they had succeeded.
On November 20, 2008 PFE rescinded its application to sell Viagra without a prescription in Europe.
Pfizer said it would halt testing of an obesity drug because the FDA approval process would be too expensive and risky. More specifically, the company was unwilling to put the drug through the human tests that the FDA was likely to require. The drug was in the third of three testing phases, and some had projected revenues of over $500MM annually.
Pfizer announced it will abandon early stage research on heart drugs and instead focus on ailments such as cancer, Alzheimer's disease and diabetes. The company believes it can make greater profits in these areas, a key concern as it tries to find a replacement for the blockbuster cholesterol pill Lipitor (25% of PFE revenue, $12.7B total sales in 2007). Lipitor's patent expires in 2011. Pfizer will sell or share the rights to at least 11 medicines currently in their early testing phases as part of this strategic shift.
Pfizer shares fell to $17.53, the lowest since 1997
A study released on Wednesday, May 21 linked use of Pfizer's new anti-smoking drug Chantix to accidents, vision problems, and heart problems. However, further studies are needed to determine whether the problems are caused by the drug itself or are symptoms of nicotine withdraw. Shares fell 1.2 percent to $19.76 in aftermarket trading, the lowest since 1997.
While Pfizer's profit fell 77 percent compared to the previous year, this is due to a $2.8 billion charge to end its partnership with Nektar Therapeutics on Exubera, an inhaled diabetes drug. Sales of the drug, previously-touted as a blockbuster, have been disappointing. Shares fell 48 cents to $24.07
U.S. courts upheld three main patents for Pfizer's arthritis drug, Celebrex. The decision will prevent Teva Pharmaceuticals from launching a similar competitor drug until 2015, extending Pfizer's monopoly in this market.
Pfizer announced major restructuring plans to cut 10,000 jobs, close three research sites and two manufacturing sites, and downsize its European sales force. Although Pfizer previously aimed to cut costs by $4 billion by 2008, cost savings estimates have been reduced to $1 billion.
Pfizer terminated Phase III clinical trials for Torcetrapib after studies showed a 60% increase in mortality rate in patients taking Torcetrapib and Lipitor versus taking Lipitor alone. Previously, there had been high hopes for Torcetrapib, a cholesterol medicine that increases "good cholesterol," and its failure cost Pfizer $800 million and investor confidence.