Pfizer sales decline; challenges foreseen

Two problems that won't go away immediately hurt drugmaker Pfizer Inc., which reported Tuesday that its sales declined 9 percent in the first quarter of 2013 compared with 2012, and that revenue projections for the rest of this year would be hurt by recent changes in foreign currency rates.

Like most major pharmaceutical companies, Pfizer is trying to squeeze as much profit as it can out of existing operations while hoping that drugs in the pipeline will one day pay off as some older medications once did.

Pfizer is based in Manhattan and has a big operation in Collegeville, Montgomery County, but parts of its earnings report were distinctly foreign in nature.

Pfizer's net income for the period increased 53 percent, from $1.79 billion to $2.75 billion, but a big chunk of that increase ($490 million) came from selling its 49 percent stake in a joint venture with China.

Generic competition will continue to be a challenge. Sales of former blockbuster drug Lipitor had already slipped by the first quarter of 2012, but in that period, Lipitor sales were $1.395 million. In the 2013 first quarter, Lipitor sales were $626 million.

The painkiller Lyrica was Pfizer's only billion-dollar drug in this quarter, with $1.07 billion in sales. Companywide revenue was $13.5 billion vs. $14.9 billion in the same period of 2012.

Japan is Pfizer's second-largest market. The Bank of Japan's early-April announcement of stimulus plans has generally lowered the value of the yen, which prompted Pfizer to lower its revenue expectations for the rest of 2013, said chief financial officer Frank D'Amelio.

After selling part of its animal unit, Zoetis, Pfizer is continuing to reorganize its human drug operations. New or soon-to-be-new medicine would be in one group, with established products in another. A sale of the latter group might be possible.

"This is a decision year on how to structure" those businesses, chief executive officer Ian Read said in a conference call with stock analysts.