Pfizer, the world's largest drug maker, reported earnings that beat analysts' estimates as the company's non-pharmaceutical units and cost cutting overcame losses from generic competition to its best-seller Lipitor.
Fourth-quarter earnings excluding some items were 50 cents a share, beating by 3 cents the average of 18 analyst estimates compiled by Bloomberg. Net income fell 50 per cent from a year earlier to $1.44 billion, or 19 cents a share, after the New York-based company lost patent exclusivity for the cholesterol pill Lipitor, Pfizer said in a statement today.
A decline in sales from prescription drugs was countered by revenue increases at the animal health unit and infant nutrition business, two divisions chief executive Ian Read has said are slated to be spun off or sold. The company reduced costs by 9 per cent in the quarter.
Pfizer's divestiture of the nutrition and animal health units is part of Read's announced strategy to shrink the company and focus on new prescription drugs.
Pfizer forecast 2012 profit of $2.20 to $2.30 a share, less than the previous range of $2.25 to $2.35, saying the difference came about because of currency exchange rates from mid-October to mid-January.
“The only thing that matters is 2012 guidance for the stock," said Seamus Fernandez, an analyst with Leerink Swann in Boston. The five-cent cut was about what investors were expecting, he said.
Revenue fell 3.5 per cent to $16.7 billion, spurred by a 6 per cent drop in sales from its pharmaceutical business to $14.14 billion. Revenues from animal health unit grew 13 per cent to $1.11 billion, and sales from the infant nutrition unit rose 22 per cent to $598 million.
Fourth-quarter net income a year earlier was $2.89 billion, or 36 cents, when the company enjoyed exclusive rights to its best-selling product Lipitor.
The company is awaiting US approval in March of its blood thinner, Eliquis, developed with Bristol-Myers Squibb to prevent stroke in heart patients, a market estimated at $7 billion to $9 billion by Leerink Swann analysts.
Bloomberg
