Pfizer Inc. has suffered a setback during the first quarter ended March 2012 and its top line as well as bottom line growth declined by 19 per cent and 7 per cent respectively mainly due to loss of exclusivity of Lipitor. Its reported net profit declined by 19 per cent to US$ 1,794 million from $2,222 million in the corresponding period of last year and its revenues declined by 7 per cent to $15,405 million from $16,502 million.
Its US revenues declined by 15 per cent $5,954 million from $7,024 million with the year-ago quarter on account of loss of exclusivity of Lipitor in November 2011. International revenues were at $9,451 million, consistent with the prior-year quarter. US revenues represented 39 per cent of total revenues in first-quarter 2012 compared with 43 per cent in the year-ago quarter, while international revenues represented 61 per cent of total revenues in first-quarter 2012 compared with 57 per cent in the year-ago quarter.
Primary care unit revenues decreased 25 per cent in comparison with the same period last year, primarily due to the loss of exclusivity of Lipitor in the US in November 2011 and the resulting shift in the reporting of US. Worldwide sales of Lipitor declined by 41.5 per cent to $1,395 million from $2,385 million in the similar period of last year. Lipitor sales in US declined by 70.7 per cent to $383 million from $1,305 million and that in international market moved down by 6.3 per cent to $1,012 million from $1,080 million.
The impact of these declines was partially offset by the strong growth of Lyrica, most notably in Japan, in addition to the solid performance of Celebrex and Premarin. Sales of Lyrica improved by 16 per cent to $955 million from $ 826 million and that of Celebrex moved up by 7 per cent to $634 million from $591 million in the last period.
Specialty care unit revenues declined 9 per cent in comparison with first-quarter 2011. Revenues were positively impacted by the growth of Enbrel as well as the Prevenar franchise in Japan and Australia, while US and developed Europe Prevnar 13/Prevenar 13 revenues were lower than in the prior-year quarter primarily because most patients eligible to receive the pediatric catch-up dose have already been vaccinated.
Established Products unit revenues increased 17 per cent operationally in comparison with the prior-year period, primarily driven by recent launches of generic versions of certain Pfizer branded primary care and specialty care products as well as $383 million of US branded Lipitor revenues. Additionally, revenues were positively impacted by our agreement granting Watson Pharmaceuticals, Inc. the exclusive right to sell the authorized generic version of Lipitor in the US.
Emerging Markets unit revenues grew 9 per cent operationally in comparison with first-quarter 2011, primarily due to continued volume growth across the product portfolio, primarily in China, Russia and Mexico, as a result of more focused, targeted promotional efforts for key products. This growth was partially offset by the negative impact of increased pricing pressures and changes in the timing of government purchases in Turkey.
Ian Read, chairman and CEO, stated, “I am pleased with our first-quarter 2012 financial performance, which was driven primarily by growth in certain brands including Celebrex, Enbrel and Lyrica, growth in key geographies such as China, as well as our continued ability to realize cost savings and efficiently allocate our shareholders’ capital. These and various other factors have mitigated the negative financial impact of product losses of exclusivity of approximately $1.3 billion compared with the year-ago quarter, including Lipitor in the US, and have enabled us to generate adjusted diluted EPS that is nearly comparable to the year-ago period.”
“Regarding our key imperative to improve the performance of our innovative core, notable progress continues as we launched the Prevnar 13/Prevenar 13 vaccine for adults in the US and EU and Inlyta for advanced renal cell carcinoma in the US, while regulatory submissions for Eliquis, tofacitinib and bosutinib are under review in key markets, with regulatory action for each anticipated in 2012. In addition, we look forward to receiving phase three clinical data for bapineuzumab for Alzheimer’s disease in mid-2012. I also remain encouraged by the emerging profiles of our next wave of innovative pipeline candidates which are in phase two or early phase three studies in areas such as oncology, vaccines, hyperlipidemia and pain.”
“I am also pleased with the recently announced agreement to sell our nutrition business to Nestlé for $11.85 billion. This is a significant milestone that I believe will unlock the trapped value of this successful business and create greater return for our shareholders.”
Frank D’Amelio, CFO, stated, “We are updating our 2012 revenues and adjusted financial guidance to reflect our decision to sell the nutrition business. We remain on-track to finalize a strategic decision for our animal health business this year and continue to expect that any separation of that business will occur between July 2012 and July 2013. Further, this quarter we continued to prudently allocate our capital by returning over $3.3 billion to our shareholders in first-quarter 2012, through $1.6 billion in dividends and $1.7 billion from the repurchase of 77 million shares.”
Beginning second-quarter 2012, the nutrition business will be presented as a discontinued operation in the consolidated statements of income for all periods presented on a retroactive basis. In addition to the aforementioned updates to the revenues and adjusted financial guidance to reflect the decision to divest the nutrition business, the guidance range for Reported Diluted EPS) decreased to a range of $1.23 to $1.38 from a range of $1.37 to $1.52, primarily reflecting additional expenses related to certain legal matters and certain asset impairment charges.