Pfizer share price sinks despite 11 per cent revenue leap
Better-than-expected quarterly revenue and profit at viagra-maker Pfizer has not managed to stiffen its share price.
Sales of newer drugs and the acquisition of hospital products company Hospira have sent revenue for the US-based drugmaker up by around 11 per cent to $13.15bn (£9.8bn) in its second quarter, narrowly beating out analyst expectations of $13.01bn.
Net income for the first quarter was $2.02bn, or 33 cents a share, compared from $2.63bn, or 42 cents per share, a year earlier.
However shares were dragged down by sales of vaccine Prevnar – Pfizers biggest product – falling short of estimates.
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Shares were down by a little over three per cent shortly after the open in New York. Pfizer shares have recovered much of their lost ground over the last six months and are trading at a similar level to 12 months ago. Shares are up by 16 per cent so far this year.
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Sales of the big pharma firm's generic medicines rose 15.7 per cent in the quarter to $6.04bn, while sales of patent-protected drugs climbed to $7.11bn, up around 7.2 per cent.
Pfizer’s new breast cancer treatment, Ibrance, performed better than expected. Sales more than tripled to $514m, compared with expectations of $498m.
Ian Read, chairman and chief executive, said:
This performance was driven by all areas of the company, reflecting ongoing strength from our recent product launches and key in-line products, the contribution of legacy Hospira products, continued improvement in the revenue profile for our standalone Essential Health business, the advancement of our product pipeline and sound capital allocation choices.
I see our product pipeline along with the assets obtained from our recent business development initiatives as positioning the company competitively in those areas where I believe Pfizer’s strengths can generate significant shareholder value over time while also benefiting patients.
Investors continue to speculate whether Pfizer will decide to split into two separate companies: one focused on research-driven treatments and the other older medicines that have gone post-patent.
There have been similar calls for UK-based GlaxoSmithKline to split itself into a separate consumer goods and a research company.
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Pfizer has been hard hit by the expiry of patents on drugs such as the pain pill Celebrex and the new drug side of the company has had to support drugs that have gone ex-patent.
Recently Pfizer was dealt a blow when the US government stepped in to effectively block its planned $160bn tax inversion tie-up with Irish pharma firm Allergan.