Pfizer said in its second-quarter earnings report that cost reductions helped it raise net income by 25 percent, despite a 79 percent drop in revenue from the cholesterol drug Lipitor.
Lipitor lost patent protection and thus, exclusivity, at the end of November in 2011, opening the field to generic competition. Lipitor had been the world's best selling prescription drug until then.
Pfizer retained some of the earnings in the first six months of 2012 with controversial incentive plans, coupons and marketing efforts. But when the field opened to multiple generic competitors in May, the extra marketing efforts stopped and the sales dropped.
Lipitor brought in $1.4 billion in revenue in the second quarter of 2011, but only $296 million in the same period in 2012.
"This performance was achieved despite the $1.8 billion, or 11%, negative impact on revenues of product losses of exclusivity compared with the year-ago period, primarily Lipitor in most major markets," Pfizer chief executive officer Ian Read said in a statement. "Worldwide revenues from many of our key medicines, including Celebrex Enbrel, Lyrica and the Prevnar/Prevenar franchise, increased and our Emerging Markets unit
generated 14% operational revenue growth, driven primarily by our targeted investments in China and Russia. Overall, I am confident that Pfizer is well-positioned for long-term success given the potential of our innovative late-stage and emerging pipeline, strong operating cash flow, streamlined organization and disciplined approach to capital allocation.”
Pfizer also said that it plans to file a registration statement with the Securities and Exchange Commission by mid-August for a potential initial public offering of up to a 20 percent ownership stake in its animal health unit, which will be named Zoetis.
Pfizer had considered selling outright the animal health division. More recently, it said it plans to eventually spin off the whole new company.
A link to the Pfizer press release with numbers is here.