NEW YORK: World's No 1 drug maker Pfizer Inc. said first quarter earnings were down 18 per cent on account of dwindling sales of its inhaled diabetes drug Exubera, competition from generic drug makers and costs involved in acquisitions and getting rid of excess staff.
The company said net income for the quarter slid to $3.39 billion, or 48 cents a share, from $4.1 billion, or 56 cents, in the corresponding quarter of last year. Profit excluding certain costs was 68 cents a share, which, however, beat analysts' estimate of 57 cents.
Revenue increased 6 per cent to $12.47 billion, which was mostly on account of increased prices of drugs.
Pfizer said its revenue for the full year 2007 will be below market expectations as it said sales of its hypertension drug Norvasc will be affected by generic versions now available in the market, six months earlier than expected following an adverse U.S. court ruling. Revenue will be $1.2 billion lower than projected earlier, it said.
It also lowered its 2007 earnings forecast saying net income will fall to $1.30 to $1.41 a share from $1.52 in 2006. Excluding certain costs, profit will be $2.08 to $2.15 a share, which is lower than the $2.16 average estimate by analysts.
Pfizer is cutting down 10 per cent of its workforce by 2008, which is part of a plan to lower costs by $500 million to $1 billion a year. It is planning to close down two U.S. plants and five research centers in the U.S., Japan and France.
The company had completed the acquisition of two firms -- Embrex Inc. and BioRexis Pharmaceutical Corp. Embrex has a vaccinating system that covers nearly 80 per cent of North American poultry, while BioRexis has a treatment under development for diabetes.
Pfizer's cholesterol drug Lipitor had its sales rise 8 per cent during the quarter to $3.4 billion. However, like other drugs, Lipitor too had generic alternatives available in the market. Norvasc sales fell 10 per cent to $1.1 billion, while sales of pain medicine Lyrica more than doubled to $395 million and that of anti-smoking drug Chantix, approved in the U.S. in May, stood at $162 million.
The company is estimating an annual loss of $10 billion in revenue following loss of patent protection in the last 12 months. Apart from Lipitor and Norvasc, its antidepressant Zoloft and antibiotic Zithromax too have lost the protection.
Commenting on the first quarter results, Jeffrey Kindler, chairman and chief executive officer of Pfizer said the quarter's results were driven by growth in the company's key in-line and new medicines, the favorable impact of foreign exchange, lower sales rebates and relatively flat operating expenses compared to the year-ago period.
Pfizer shares fell 39 cents, or 1.4 per cent, to $26.68 in early trading Friday.
