Pfizer sees '06 profit slightly under the weather
The drugmaker says it expects earnings of $2 a share without charges, below analysts' estimates.
NEW YORK (CNNMoney.com) - Pfizer Inc. gave earnings guidance Friday that was below analysts' estimates.
The drugmaker, in an analyst meeting in New York, said it expected diluted earnings per share expected to be $1.52 to $1.56 in 2006, or $2 without charges. Analysts on average had forecast $2.04 per share for the year, excluding items, and $2.16 on that basis for 2007, according to First Call.
CEO Henry McKinnell also said that the consumer products division that Pfizer said earlier this week it was looking to divest could have a market value of $10 billion. The division includes Listerine, Rolaids and other consumer products.
"We all understand the effects of the numerous and closely-spaced patent expirations we face," he said. "Challenging as these may be, we are moving through this difficult period and we will talk today about accelerating revenue growth."
"To build the platform for the next-generation Pfizer, we've gained scale, revitalized R&D, streamlined our company, launched many new medicines, and learned to prosper in an environment of increased payer (insurer) power," the CEO added.
McKinnell said that "over the next three years, a new generation Pfizer will emerge, and our company will have the operating and financial strength to sustain value."
The company said sales for Lipitor, a cholesterol-lowering statin and the world's top-selling drug, are expected to exceed $13 billion in 2006, up from $12.2 billion in 2005.
Sales for Celebrex, an arthritis pain killer, are expected to exceed $2 billion in 2006, while nerve pain treatment Lyrica is expected to exceed $900 million in sales.
The drugmaker is expected to file applications to the Food and Drug Administration for five new drugs in 2006 and 2007. Pfizer also expects to launch six new drugs on the market in 2006.
Zoloft, the antidepressant that totaled $3.3 billion in 2005 sales, faces patent expiration in 2006. In 2007, Pfizer stands to lose its patent on Norvasc, the blood pressure treatment with $4.7 billion in 2005 sales, and on Zyrtec, an allergy treatment with $1.3 billion in 2005 sales.
Pressure from generic drug makers is one of the top challenges to Pfizer in achieving sales growth. Pfizer vice chairman and general counsel Jeff Kindler said Pfizer is pursuing 300 patent infringement cases in more than 50 countries.
Pfizer plans to reduce its manufacturing plants worldwide from 93 to 66. This is separate from its efforts to cut costs by $4 billion per year.
Pfizer reduced costs by $800 million in 2005 and is expected to cut $2 billion in 2006 building up to $4 billion in annual cost savings by 2008.
The drugmaker, based in New York City, said revenue growth is expected to resume in 2007.
The analysts meeting came five months after the company withdrew guidance last year.
Click here for four questions for Pfizer