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Pfizer pulls Bextra off the market
FDA cites health concerns; drugmaker 'disagrees' but complies; stock takes a hit but recovers.
April 7, 2005: 4:35 PM EDT
By Aaron Smith, CNN/Money staff writer
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Pfizer pulled its blockbuster arthritis drug Bextra off the market in the U.S. and Europe after regulators cited safety concerns.
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NEW YORK (CNN/Money) - Pfizer Inc. said Thursday it is pulling its arthritis painkiller Bextra off the market after the Food and Drug Administration asked for the recall.

The FDA cited inadequate information on possible heart risks from long-term use of the drug as well as "life-threatening" skin reactions, including deaths.

The regulatory agency also called for the strongest warning possible on Pfizer's other arthritis product, Celebrex.

Pfizer (Research) said it is also suspending Bextra sales in the European Union at the request of European regulators.

The move comes about six months after rival drugmaker Merck & Co. pulled its blockbuster arthritis drug Vioxx off the market, also due to safety concerns.

In calling for a stronger warning on Celebrex labels, the FDA cited increased risk of cardiovascular "events" and gastrointestinal bleeding and said all similar drugs should have label warnings.

Pfizer said it "respectfully disagrees" with the FDA decision.

The New York-based drugmaker said in a statement that it planned further discussions with the agency over the content of the Celebrex label and would explore options to making Bextra available in the future. (To read Pfizer's statement, click here).

The FDA said patients taking Bextra should contact their physicians to consider alternative treatments. An FDA spokesman was not immediately available for further comment. (To read the FDA's statement, click here).

Pfizer and the FDA said Celebrex is one of the options for arthritis pain at the "lowest effective dose for appropriate patients."

Celebrex, with $3.3 billion in sales last year, and Bextra, with $1.3 billion in 2004 sales, are among Pfizer's top-selling products. The company had $52.5 billion in total sales last year, led by Lipitor, the cholesterol-lowering medicine with sales of $10.7 billion.

Drug industry analyst C.J. Sylvester at Banc of America said the Bextra withdrawal took him by surprise, noting it came just two days after Pfizer executives said sales of the arthritis drugs would be reinvigorated in coming months.

"The big surprise is the FDA's request for the withdrawal of Bextra given that the advisory committee (to the FDA) voted that Bextra should remain on the market back in mid-February," Sylvester wrote in a research report.

"We don't believe [Pfizer] anticipated a Bextra removal and the 'black box' label for Celebrex won't help prescription trends and may actually" hurt sales of the drug, he added, reiterating his "neutral" rating on the stock.

Barbara Ryan, analyst for Deutsche Bank North America, said Pfizer's withdrawal of Bextra will have a limited impact on the company's revenue because the drug was already experiencing reduced sales this year. Prior to the announced withdrawal, Ryan had projected Bextra sales of $600 million for this year, less than half the sales for 2004, and $490 million for 2006.

"The news on Bextra was certainly more negative than expected because the advisory committee had recommended to the FDA that Bextra remain on the market, albeit by a narrow margin," said Ryan, who rates Pfizer a "buy." "But at the end of the day, it's maybe a four cent hit [to annual earnings per share] so maybe it's not that big a deal."

Pfizer reported annual earnings per share of $2.12 last year and projected $2 for 2005.

In an interview with CNN, Lehman Brothers analyst Anthony Butler said that Pfizer's large revenue base gives it the flexibility to ride out a loss in product sales.

"It strikes me as being unique that a company can see half a billion dollars in income go away and see it as a relatively small impact on earnings per share," said Butler, in reference to the Bextra withdrawal.

Pfizer stock ended little changed on the New York Stock Exchange after tumbling early in the session. Merck rose 1.8 percent, reversing early declines.

The Vioxx recall wiped $25 billion from Merck's (Research) market value in a single day -- click here for more.

To check all of today's business headlines, click here.  Top of page

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