Pfizer looks to spin off animal health and nutrition
pharmafile | August 2, 2011 | News story | Sales and Marketing | Pfizer, Q2, animal health, divestment, nutrition
Pfizer looks set to spin-off or sell its animal health and nutrition business units in order to focus on human medicines.
Pfizer’s chief executive Ian Read confirmed his company was ‘exploring strategic alternatives’ for the two units.
This comes despite solid growth for the businesses, with animal health up 18% to $1 billion (£614 million) for the second quarter and its nutrition unit up 4% to $493 million.
Analysts say the decision is due primarily to the looming patent loss of top-selling cholesterol drug Lipitor, set to succumb to generic erosion in the US this November, potentially wiping billions from Pfizer’s revenue.
Despite a large marketing campaign in the US, where sales were up 8%, total Lipitor sales still slipped by the same percentage, hit by patent expiry in Canada and Spain last year.
Pfizer achieved a steady second quarter overall, with total sales down 1% to $16.98 billion and pharma sales down 3% to $14.64 billion.
These losses came from Lipitor and antidepressant Effexor XR, down 73% to $168 million, due to its patent expiry.
The biggest growth driver came from paediatric vaccine Prevnar/Prevenar 13 for pneumococcal bacteria, up 44% in total sales to $821 million.
Sales could further increase for the vaccine as it is currently awaiting an FDA decision on its approval in adults aged 50 and over – although the US regulator has recently delayed its decision by 90 days to allow time to review additional study data submitted by Pfizer.
Overall, Pfizer is still positive that its core pharma business will produce future growth, and believes that its three key late-stage drugs – blood thinner Eliquis, lung cancer drug crizotinib and rheumatoid arthritis drug tofacitinib – will help compensate for the loss of Lipitor.
This optimism has led the US pharma giant to reaffirm its 2011 financial guidance and its 2012 targets.
Read said the performance this quarter was ‘in-line with the company’s expectations’.
“Although results were impacted by losses of exclusivity of several key products in certain geographies, most notably in our established products business, I am pleased that many of our core products, primarily Lyrica, Enbrel and the Prevnar/Prevenar franchise, continued to perform well overall and the fundamentals of our business remain strong,” he said.
The company’s chief financial office Frank D’Amelio said that Pfizer would continue its share buyback scheme throughout the year, and anticipates repurchasing a total of between $5 billion and $7 billion of its common stock by the end of the year.
Ben Adams
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