Pfizer has posted lower revenue during the first quarter ended March 2015 due to the loss of exclusivity and immediate multi-source generic competition for Celebrex in the US and termination of the Spiriva co-promotion collaboration in certain countries. Its revenue declined by 4.3 per cent to $10,864 million from $11,353 million in the corresponding period of last year. Its net profit, however, improved marginally by 2 per cent to $2,376 million from $2,329 million. EPS worked out to $0.38 as against $0.36 in the last period.
The company manages its commercial operations through two distinct businesses viz., an innovative products business and an established products businesses. The innovative products business is composed of two operating segments like the global innovative pharmaceutical (GIP) segment and the global vaccines, oncology and consumer healthcare (VOC) segment. The established products business consists of the global established pharmaceutical (GEP) segment.
The sales of GEP declined by 16.3 per cent to $5,014 million from $5,990 million in the same period of last year. However, the sales of innovative products improved by 9.3 per cent to $5,738 million from $5,250 million. The sales of global vaccines improved sharply by 43.6 per cent to $1,328 million from $925 million. GIP sales remained almost stagnant at $3,075 million. Its sales of global oncology moved up by 8.2 per cent to $528 million from $488 million.
Certain key products like Prevnar 13, Eliquis, Lyrica, Nexium 24HR, Xeljanz and Viagra achieved higher sales in US. Additionally, revenues in emerging markets increased by 12 per cent operationally. Revenue for Lipitor in developed markets declined as a result of continued generic competition. Prevenar 13 revenue in the US increased by 80 per cent, primarily driven by continued strong uptake among adults. Its international revenues increased 21 per cent operationally, driven by Prevenar 13.
The R&D expenditure increased by 16.4 per cent to $1,877 million during the first quarter ended March 2014 from $1,612 million in the similar period of last year due to the $295 million upfront payment to OPKO in first quarter associated with a worldwide development and commercialization agreement. Selling, marketing and administrative expenditure remained almost same at $3,078 million.
Ian Read, chairman and CEO, stated, “We began the year with good performance on both the top and bottom line and I believe the company is well-positioned in terms of in-line products, recent product launches, geographic reach and product pipeline.”
“During the first quarter of 2015, our new products delivered strong performances. We continued to see strong uptake for our Prevenar 13 vaccine in older adults in the US. Ibrance, our recently approved therapy for first-line advanced breast cancer in the US, performed very well following its February launch. We also announced this month that a phase 3 trial of Ibrance for recurrent breast cancer had met its primary endpoint of progression-free survival (PFS). Additionally, Eliquis delivered another strong quarter of growth as adoption among cardiologists continues to improve globally.”
“Also during the first quarter of 2015, we announced the proposed acquisition of Hospira, Inc. (Hospira). This business represents an excellent strategic fit in growing market segments and is expected to accelerate the growth trajectory of our global established pharmaceuticals business. In addition to share repurchases and dividend payments, we continue to consider business development to be an attractive use of shareholder capital.”
“We continue to advance our product pipeline, which currently includes a competitive and diverse mix across small and large molecules and vaccines. I believe we are well-positioned in promising new areas of biology such as immune-oncology, anti-PCSK9 for improved cardiovascular outcomes associated with LDL cholesterol reduction and vaccines for the potential prevention of life threatening infections such as staphylococcus aureus and clostridium difficile.”
Frank D’Amelio, chief financial officer, stated, “We also continued to demonstrate our commitment to delivering significant value directly to shareholders by returning approximately $7.8 billion to shareholders through dividends and share repurchases so far this year, including entering into a $5 billion accelerated share repurchase agreement executed in February. After repurchasing $6 billion of our common stock in first-quarter 2015, we have already met our 2015 share repurchase target and do not currently expect to repurchase additional shares this year.”
With strong dollar, it lower its projection for EPS in 2015 to $1.32 to $1.47 from previously announced $1.37 to $1.52. With the weakening of Euro, full year 2015 revenue is stated between $44.5 to $46.5 billion.