Pfizer Beats Sales and Profit Forecasts, Mum on Future Deals
Pfizer Inc (PFE.N) reported stronger-than-expected quarterly results, helped by growing sales of its cancer drugs and demand for its medicines in emerging markets, but did not signal any acquisition plans following its recent failed efforts to buy rival British drugmaker AstraZeneca Plc (AZN.L).
The largest U.S. drugmaker on Tuesday said it had earned $2.67 billion, or 42 cents per share, in the third quarter. That compared with $2.59 billion, or 39 cents per share, a year earlier.
Excluding special items, Pfizer earned 57 cents per share. Analysts on average expected 55 cents, according to Thomson Reuters I/B/E/S.
Sales fell 2 percent to $12.36 billion, hurt by generic competition and expiration of a longstanding deal with Amgen Inc (AMGN.O) to co-market its Enbrel arthritis drug. But they topped Wall Street expectations of $12.24 billion.
Pfizer tightened its full-year earnings forecast to between $2.23 and $2.27 per share from its prior outlook of $2.20 to $2.30.
The company officially gave up its six-month pursuit of AstraZeneca after its final $118 billion bid was rejected on May 26. It had hoped to base the combined company in Britain, which has lower taxes than the United States, a maneuver called tax inversion.
Under UK takeover rules, Pfizer can make another run at AstraZeneca late next month, but the company did not mention its intentions in Tuesday’s earnings report.
U.S. drugmaker AbbVie (ABBV.N) two weeks ago gave up its $55 billion quest to buy Dublin drugmaker Shire, another tax-inversion deal, because of new U.S. Treasury tax rules that made the deal less attractive.
“Now that (AbbVie) has canceled its deal, it’s less likely that Pfizer will move ahead” with its own attempt at AstraZeneca, said Edward Jones analyst Ashtyn Evans.
But given Pfizer’s predicted lack of growth over the next few years because of patent expirations, Evans said Pfizer “will still have to do something, like breaking up the company or making a big acquisition.”
In the next four years, generic rivals will challenge blockbuster Pfizer products such as painkiller Celebrex, nerve pain treatment Lyrica and anti-impotence drug Viagra. The three drugs, with combined annual sales of almost $10 billion, generate about 20 percent of current company sales.
Lyrica sales jumped 16 percent to $1.32 billion in the quarter, while Viagra sales fell 7 percent to $427 million due to generic competition in Europe. Sales of Celebrex, which goes generic in the United States in December, rose 2 percent to $764 million.
Pfizer Chief Executive Ian Read on Tuesday said the company would rely on “operational and financial efficiencies and remain opportunistic regarding business development.” The company stressed that its board last week had authorized a new $11 billion share repurchase program over time.
Pfizer shares rose 3 cents to $29.06 in premarket trading.
Source: Reuters
