Tuesday January 20, 12:01 pm Eastern Time
Company Press Release
SOURCE: Pfizer Inc
Pfizer Revenue Increases 11 Percent To $3,496 Million For Quarter As Net
Income Rises 11 Percent To $558 Million
Diluted e.p.s. were $0.43 for the quarter, $1.70 for the year
Alliance Revenue Strong; Trovan Shipments Begun.
NEW YORK, Jan. 20 /PRNewswire/ -- Pfizer Inc today reported total revenue of $3,496 million for the fourth quarter and
$12,504 million for the year, increases of about 11 percent each. The impact of foreign exchange reduced growth by 4.8
percent for the quarter and 3.6 percent for the year. Revenues excluding the impact of foreign exchange grew by 15.4 percent
for the quarter and 14.2 percent for the year.
Net income for the quarter and year rose by 11 percent to $558 million and by 15 percent to $2,213 million, respectively.
Diluted earnings per share (e.p.s.) rose by 10 percent for the quarter and 13 percent for the year, reaching $0.43 and $1.70,
respectively.
''Our challenge in 1997 was balancing growth and investment,'' said William C. Steere, Jr., chairman and chief executive
officer, ''and the results for the quarter and the year demonstrate our success in doing so. In 1997, our revenue grew strongly
and the company's net income exceeded $2 billion for the first time in history. At the same time, we were a partner in the
launches of two major new products and invested heavily in an expanding field force. Furthermore, we fully funded research and
development at more than $1.9 billion.
''We are particularly pleased with the performance of Lipitor and Aricept, launched last year in the U.S. and elsewhere with our
marketing partners Warner-Lambert Company [NYSE:WLA - news] and Eisai,'' he continued. ''Both Lipitor, for the treatment
of elevated blood cholesterol and triglycerides in patients with high cholesterol, and Aricept, for the treatment of Alzheimer's
disease patients, have been strong additions to our broad line of innovative products.
''Trovan, our new broad-spectrum antibiotic, was cleared for marketing by the U.S. Food and Drug Administration (FDA) in
December and we have begun shipments to customers,'' Mr. Steere said. ''The regulatory filings for Viagra, for the treatment of
erectile dysfunction, and Zeldox, an anti-psychotic, are under review at the FDA and in Europe.''
BUSINESS SEGMENT FOURTH-QUARTER PERFORMANCE
Health Care
Pharmaceuticals
Revenue of the global pharmaceuticals business increased by 13 percent (18
percent, excluding the impact of foreign exchange) for the fourth quarter.
U.S. revenue increased by 19 percent to $1,507 million, while international
reported revenue increased by 5 percent to $1,072 million for the quarter.
Excluding the effect of foreign exchange, international revenue increased by
16 percent.
In their first year of sales, Lipitor and Aricept combined contributed alliance revenue of $163 million for the quarter and $316
million for the year. Lipitor was discovered and developed by the Parke-Davis research division of Warner-Lambert Company.
Aricept was discovered and developed by Eisai. In addition to the U.S., both products are available in the U.K., Canada,
Germany, Italy and elsewhere.
Fourth-quarter sales of Norvasc increased by 21 percent to $624 million. The company's first $2-billion product, Norvasc
continues to benefit from the increasing body of clinical data supporting its safety and efficacy in treating hypertension and angina
in a broad range of patients, including those with serious concomitant conditions such as congestive heart failure. Sales of
Procardia XL declined by 25 percent to $192 million primarily as a continued effect of the medical community's increased
emphasis on the more advanced Norvasc. Sales of Cardura, for the treatment of hypertension and enlarged prostate, increased
by 9 percent to $163 million. We believe the growth rate of Cardura was negatively affected by lower wholesaler inventory
levels in the U.S. relative to the fourth quarter of 1996.
Sales of Zoloft, the selective serotonin reuptake inhibitor for the treatment of depression, obsessive-compulsive disorder and
panic disorder, increased by 6 percent to $395 million for the quarter. The product's first- quarter 1997 launch in France and
Germany, new indications in several countries and growing overall demand for this class of drugs were partially offset, we
believe, by lower wholesaler inventory levels in the U.S. relative to the fourth quarter of 1996. In the cases of both Zoloft and
Cardura, the full-year rate of sales growth is a better indication of the underlying demand for the product than a
quarter-to-quarter comparison. In the U.S., the full- year sales-growth rate for Zoloft was 9 percent, and for Cardura was 31
percent.
Sales of the antibiotic Zithromax continued to grow, increasing by 34 percent to $267 million for the quarter. Zithromax is the
fastest-growing and most-prescribed brand name oral antibiotic in the U.S.
Sales of Diflucan, the innovative anti-fungal, decreased by 6 percent to $226 million. Diflucan results continue to show the
impact of the success of protease inhibitors in treating AIDS patients. Diflucan treats fungal infections common among AIDS
patients and others with compromised immune systems.
Sales of Zyrtec, our advanced treatment for allergies, increased by 43 percent to $71 million for the quarter. The increase was
driven by exceptional growth in the U.S. as the medical community's awareness and acceptance of the product continue to
grow.
Medical Technology
Sales of the Medical Technology Group (MTG) increased by 1 percent to $424 million for the quarter, a 6-percent increase
excluding the effect of foreign exchange. The growth was driven primarily by sales of stents, which increased by 29 percent to
$40 million. MTG stents are gaining acceptance for peripheral uses worldwide and coronary uses in Europe. The increase in
stent sales was largely offset by declines in sales of products for angioplasty and urology, principally due to heightened pricing
pressures and new-product competition.
In December, the company announced an agreement to sell the Valleylab division to United States Surgical Corporation
[NYSE:USS - news] for $425 million. Valleylab makes electrosurgical and ultrasonic equipment and disposable surgical items.
Medical Technology sales for the quarter and full year include those of Valleylab. The company expects to close the sale by the
end of January.
Animal Health
Sales of the Animal Health Group increased by 10 percent to $397 million for the quarter, driven by the sales growth of new
and in-line products. Sales of products for companion animals increased by 12 percent and food- animal product sales
increased by 9 percent. The Animal Health Group has had four consecutive quarters of double-digit growth excluding the effect
of foreign exchange. On that basis, sales for the fourth quarter increased 15 percent.
Fourth-quarter sales of Rimadyl, the canine anti-inflammatory launched in January 1997, reached $13 million, a 15-percent
increase over sales for the third quarter.
Quarterly sales of Dectomax, an innovative antiparasitic used in livestock, reached $65 million, an increase of 94 percent over
the fourth quarter of 1996. The sales increase was largely the result of the introduction of Dectomax Pour-on, a new,
easy-to-use transdermal form of the product.
In December 1997, Pfizer finalized the purchase of global marketing and distribution rights for Anipryl, for the treatment of
Cushing's disease, a metabolic disorder, in dogs. A U.S. regulatory filing seeking approval for its use in the treatment of
cognitive disorders in dogs is under review.
Consumer Health Care
Sales of Consumer Health Care for the quarter increased by 1 percent to $96 million, as increased sales of over-the-counter
medicinal products were offset by weak market conditions.
COMMENTARY
Looking forward to 1998 and beyond, David Shedlarz, senior vice president and chief financial officer, said, ''We are now
beginning the commercialization of a new wave of innovative pharmaceuticals. Our commercial opportunities required
substantial investment during 1997, and we expect to see further investment in 1998 as Trovan and other new products come to
market. In addition, we expect to continue our strong commitment to R&D in order to fuel our future growth. As in 1997, our
1998 results will depend heavily on the size and timing of these investments and the revenue streams from newly introduced
products.
''Financial performance in 1998 could again be tempered by foreign exchange factors,'' Mr. Shedlarz continued. ''Foreign
exchange negatively affected revenues and net income in 1997 despite a currency-hedging program and the natural hedges
offered by the global scope of our business. At today's rates, the negative effect of currency factors on revenue growth would
be about 3 percent in 1998.''
Said Mr. Steere, ''The challenge at hand for Pfizer continues to be striking the right balance between current growth and
investment to sustain our growth into the future. Fortunately, the success of our existing products, the strong commercial
potential of new products and improved organizational efficiency and effectiveness position us well to meet this challenge. We
believe our investments will return benefits both in the short term and for many years to come. Our strategy is to meet unmet
medical needs through R&D while continuing to grow by innovation in all areas of our business. We are, I believe, stronger than
ever, and well-positioned to advance during 1998 toward our stated goal of becoming the premier company in our industry.''
Forward-looking statements in this document should be evaluated with due consideration given the many uncertainties inherent
in our business, particularly those mentioned in the cautionary statements in Part 1 of our 1996 Form 10-K, which we
incorporate here by reference.
PFIZER INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
(millions of dollars, except per share data)
Fourth Quarter % Inc./ Full Year % Inc./
1997 1996 (Dec.)* 1997 1996 (Dec.)*
Net sales $3,333 $3,160 5 $12,188 $11,306 8
Alliance revenue 163 0 ** 316 0 **
Total revenues 3,496 3,160 11 12,504 11,306 11
Costs and expenses
Cost of sales 673 620 9 2,274 2,176 5
Selling, informational and
administrative exps. 1,411 1,249 13 4,956 4,366 13
Research and development
expenses 577 490 18 1,928 1,684 14
Other deductions--net 57 72 (19) 258 276 (6)
Income before provision
for taxes on income and
minority interests 778 729 7 3,088 2,804 10
Provision for taxes on
income 218 226 (4) 865 869 (1)
Minority interests 2 (1) ** 10 6 71
Net income $ 558 $ 504 11 $ 2,213 $ 1,929 15
Basic earnings per
common share $ .44 $ .41 7 $ 1.76 $ 1.55 14
Diluted earnings per
common share $ .43 $ .39 10 $ 1.70 $ 1.50 13
* - Percentages may reflect rounding adjustments.
** - Calculation not meaningful.
1. The above financial statements present the periods ended December 31.
Subsidiaries operating outside the United States are included on a
fiscal year basis ended November 30.
2. Per share data have been restated to reflect the two-for-one stock
split in the form of a 100 percent stock dividend paid on June 30,
1997 to shareholders of record on June 2, 1997.
3. The Company has entered into alliances in the U.S. and on a broad basis
around the world with Eisai Co., Ltd. to promote Aricept and with the
Parke-Davis division of Warner-Lambert Company to promote Lipitor.
Alliance revenue reflects amounts earned by the Company, net of certain
obligations incurred under the agreements. Other expenses associated
with these copromoted products are reflected in selling, informational
and administrative expenses.
PFIZER INC
SEGMENT/PRODUCT REVENUES
FOURTH QUARTER 1997
(millions of dollars)
QUARTER-TO-DATE
WORLDWIDE U.S. INTERNATIONAL
% % %
1997 1996 Chg 1997 1996 Chg 1997 1996 Chg
TOTAL
REVENUES 3,496 3,160 11 1,945 1,655 18 1,551 1,505 3
TOTAL
HEALTH CARE 3,003 2,703 11 1,737 1,488 17 1,266 1,215 4
PHARMA-
CEUTICALS 2,579 2,282 13 1,507 1,264 19 1,072 1,018 5
-CARDIOVASCULAR
DISEASES 1,019 961 6 552 549 1 467 412 13
NORVASC 624 516 21 287 227 27 337 289 17
PROCARDIA XL 192 255 (25) 192 255 (25) 0 0 0
CARDURA 163 150 9 71 63 13 92 87 6
-INFECTIOUS
DISEASES 696 652 7 342 288 18 354 364 (3)
DIFLUCAN 226 240 (6) 100 107 (6) 126 133 (5)
ZITHROMAX 267 199 34 197 134 46 70 65 10
UNASYN 89 88 1 40 41 (2) 49 47 5
SULPERAZON 36 36 (1) 0 0 0 36 36 (1)
-CENTRAL NERVOUS
SYSTEM
DISORDERS 411 383 7 315 313 0 96 70 38
ZOLOFT 395 372 6 311 309 1 84 63 33
-DIABETES 62 60 5 52 51 3 10 9 12
GLUCOTROL XL 47 42 10 44 41 7 3 1 94
GLUCOTROL 9 10 (10) 7 8 (9) 2 2 (10)
-ARTHRITIS/
INFLAMMATION 69 82 (17) 4 6 (20) 65 76 (16)
FELDENE 62 74 (16) 4 6 (20) 58 68 (15)
-ALLERGY 73 52 39 72 51 40 1 1 (6)
ZYRTEC/
REACTINE 71 49 43 70 49 44 1 0 --
-ALLIANCE
REVENUE * 163 0 -- 168 0 -- (5) 0 --
MEDICAL
TECHNOLOGY 424 421 1 230 224 2 194 197 (1)
ANIMAL HEALTH 397 362 10 156 113 39 241 249 (4)
CONSUMER
HEALTH CARE 96 95 1 52 54 (4) 44 41 7
* - Alliance revenue reflects the results of business alliances for two
new pharmaceutical products, Lipitor and Aricept.
Certain amounts and percentages may reflect rounding adjustments.
Certain prior year data have been reclassified to conform to the current
year presentation.
PFIZER INC
SEGMENT/PRODUCT REVENUES
FULL YEAR 1997
(millions of dollars)
YEAR-TO-DATE
WORLDWIDE U.S. INTERNATIONAL
% % %
1997 1996 Chg 1997 1996 Chg 1997 1996 Chg
TOTAL
REVENUES 12,504 11,306 11 6,867 5,941 16 5,637 5,365 5
TOTAL
HEALTH CARE 10,689 9,630 11 6,041 5,238 15 4,648 4,392 6
PHARMA-
CEUTICALS 9,239 8,188 13 5,246 4,464 18 3,993 3,724 7
-CARDIOVASCULAR
DISEASES 3,806 3,486 9 2,101 2,018 4 1,705 1,468 16
NORVASC 2,217 1,795 23 992 785 26 1,225 1,010 21
PROCARDIA XL 822 1,005 (18) 822 1,005 (18) 0 0 0
CARDURA 626 533 17 278 213 31 348 320 9
-INFECTIOUS
DISEASES 2,483 2,325 7 1,113 946 18 1,370 1,379 (1)
DIFLUCAN 881 910 (3) 396 409 (3) 485 501 (3)
ZITHROMAX 821 619 33 553 372 48 268 247 9
UNASYN 346 326 6 149 146 2 197 180 9
SULPERAZON 139 139 0 0 0 0 139 139 0
-CENTRAL NERVOUS
SYSTEM
DISORDERS 1,553 1,382 12 1,233 1,140 8 320 242 33
ZOLOFT 1,507 1,337 13 1,220 1,123 9 287 214 35
-DIABETES 234 213 9 195 180 8 39 33 15
GLUCOTROL XL 175 135 30 165 133 24 10 2 421
GLUCOTROL 33 49 (33) 25 40 (37) 8 9 (16)
-ARTHRITIS/
INFLAMMATION 269 315 (15) 14 19 (22) 255 296 (14)
FELDENE 241 282 (14) 14 19 (22) 227 263 (14)
-ALLERGY 273 156 74 267 150 78 6 6 (16)
ZYRTEC/
REACTINE 265 146 81 259 140 86 6 6 (16)
-ALLIANCE
REVENUE * 316 0 -- 316 0 -- 0 0 --
MEDICAL
TECHNOLOGY 1,450 1,442 1 795 774 3 655 668 (2)
ANIMAL HEALTH 1,329 1,222 9 505 400 26 824 822 0
CONSUMER
HEALTH CARE 486 454 7 321 303 6 165 151 9
* - Alliance revenue reflects the results of business alliances for two
new pharmaceutical products, Lipitor and Aricept.
Certain amounts and percentages may reflect rounding adjustments.
Certain prior year data have been reclassified to conform to the current
year presentation.
SOURCE: Pfizer Inc |
