Pfizer Beats Expectations In Spite of Lower Profits
{{#rendered}} {{/rendered}}Pfizer Inc. (PFE) Thursday said fourth-quarter profit fell, hurt by generic competition, but cost cuts helped the company beat Wall Street expectations and its shares jumped 3 percent.
The world's biggest drug maker said it earned $2.73 billion, or 37 cents per share, compared with $2.83 billion, or 38 cents per share, a year earlier.
Excluding a series of one-time items, New York-based Pfizer earned 51 cents per share. Analysts polled by Reuters Estimates, on average, had forecast 42 cents.
{{#rendered}} {{/rendered}}Pfizer said quarterly revenue fell 9 percent to $13.59 billion, a better showing than the $13.27 billion Wall Street had forecast.
"Investors will look at quarter and like fact that they beat estimates," said Oppenheimer & Co. analyst Scott Henry.
But he noted that Pfizer last October pulled its forecasts for 2006 and 2007, creating lingering uncertainty about the prospects for Pfizer.
{{#rendered}} {{/rendered}}Henry said he can't "interpret a lot of enthusiasm" for Pfizer until the company provides new forecasts on Feb. 10.
Global sales of cholesterol fighter Lipitor edged up 3 percent to $3.36 billion, a continuation of anemic growth in recent quarters as health insurers steer patients to less-expensive and less-potent products.
Even so, annual sales of Lipitor grew 12 percent to $12.19 billion, easily preserving its title as the world's top-selling prescription drug.
{{#rendered}} {{/rendered}}For full-year 2005, total company revenues slipped 2 percent to $51.3 billion, as cheaper generics cut deeply into sales of Pfizer treatments that have recently lost patent protection.
They include epilepsy treatment Neurontin, whose fourth-quarter sales plunged 71 percent to $141 million, and hypertension drug Accupril, which fell 74 percent to $44 million.
Contributing to the pain was arthritis treatment Celebrex, whose quarterly sales fell 53 percent to $472 milllion. Demand for the medicine has waned sharply following the recall in 2004 of Vioxx, a similar drug made by Merck & Co. (MRK) that has been linked to heart attacks and stroke.
{{#rendered}} {{/rendered}}Celebrex itself has also been linked in one large trial to a two-fold increase in heart attack risk, although Pfizer has staunchly defended its safety.
Pfizer in October withdrew its rosy outlook for 2006 and 2007 — sending shares at the time to an eight-year low. It had been predicting earnings would rise in the double-digit percentage range in 2006, with accelerating double-digit growth in 2007.
Pfizer shares have since rebounded, bolstered by a recent victory over Indian generic drugmaker Ranbaxy Laboratories Ltd. in a patent battle over Lipitor and Pfizer's decision to sharply raise its quarterly dividend.
{{#rendered}} {{/rendered}}The company said it will provide new financial forecasts for 2006 next month at an analyst meeting, after re-assessing its financial condition.
Pfizer shares rose to $24.82 before the bell on Thursday from Wednesday's close of 24.