Pfizer, struggling with fierce competition from makers of generic drugs, will cut 10,000 jobs and close at least five facilities to slash annual costs by up to US$2bn.
It is the second time in two years that the maker of Viagra and Lipitor has announced a major cost reduction plan to combat revenue losses. It will lose approximately $14bn in revenue this year because of expiring patents on key drugs.
Despite this, Pfizer has announced that its revenues for full-year 2006 increased 2%, reported diluted earnings per share (EPS) grew 144%, and adjusted diluted EPS grew 6% when compared with 2005. Revenues in the fourth quarter of 2006 were substantially unchanged, reported diluted EPS grew 257%, and adjusted diluted EPS decreased 12% percent versus the comparable quarter in 2005.
'In the face of many challenges in 2006, we substantially achieved a number of financial targets that we set early in the year,' said Pfizer chairman and ceo Jeffrey Kindler.
'We took decisive action and delivered solid performance despite challenges, including the significant revenue impact due to the loss of exclusivity of Zithromax and Zoloft in the U.S.'
'Worldwide pharmaceutical 2006 revenues met our expectations,' said Ian Read, the company's president of worldwide pharmaceutical operations.
'We focused on the top-line growth of key in-line medicines, including Lipitor, Celebrex, Lyrica, and Geodon, and we launched Sutent, Eraxis, Chantix, and Exubera in the US,' Read added.
Worldwide pharmaceutical revenues were $45.1 billion for full-year 2006. In the US, revenues increased 4 percent for the full-year 2006 compared to the same period in 2005.
'We continued to advance the candidates in our pipeline during the fourth quarter of 2006,' said John LaMattina, president of Pfizer global research and development. Maraviroc, the CCR5 receptor antagonist to treat HIV infection, was submitted for approval in the U.S. and EU in December 2006. Maraviroc has been accepted for filing and granted an accelerated review in the EU.
Four new programs advanced into Phase 3 during the final quarter of 2006: Axitinib an anti-angiogenesis agent to treat thyroid cancer; CP-945,598, a cannabinoid-1 antagonist to treat obesity and its complications, Sutent for the treatment of metastatic breast cancer and Zithromax/chloroquine to treat malaria, the single greatest killer of children in Africa.