Pfizer Inc Total Revenues Increased By 11 Percent, As Net Income
Increased By 15 Percent for the First Quarter
Diluted Earnings Per Share Increased By 15 Percent
NEW YORK, April 14 /PRNewswire/ -- Pfizer Inc (NYSE: PFE - news) today reported total revenues for the quarter of
$3,339 million, an increase of 11 percent over the first quarter of 1997. Net income was $692 million, a 15-percent increase.
The increase in revenues was driven largely by higher sales volume. Excluding the impact of foreign exchange, total revenues
increased by 16 percent, led by a 21-percent increase in worldwide sales of pharmaceuticals. Price increases contributed 1.5
percentage points to revenue growth.
''As in 1997, our challenge in this year of several major new-product launches will be balancing growth and investment,'' said
William C. Steere, Jr., chairman and chief executive officer. ''With the U.S. approval in April, we have begun shipping Viagra.
Viagra is the first oral treatment for erectile dysfunction, discovered and developed by Pfizer. We have initiated the worldwide
launch of Trovan, the broad-spectrum quinolone antibiotic discovered and developed by Pfizer. Trovan's approval by the U.S.
Food and Drug Administration included an unprecedented 14 indications, and it is available in both oral and IV formulations.
These factors have led to outstanding initial success for Trovan due to its rapid acceptance by the medical community.
''We are also increasing our pharmaceuticals field forces worldwide,'' Mr. Steere continued. ''At the same time, we are
continuing to roll out Lipitor, for the treatment of elevated blood cholesterol, and Aricept, for the treatment of Alzheimer's
disease, with our co-promotion partners Warner- Lambert Company and Eisai, respectively, the discoverers of the drugs.''
The company also said that the FDA is continuing its review of the company's new anti-psychotic agent Zeldox (ziprasidone). A
New Drug Application (NDA) for Zeldox was originally filed with the FDA in March 1997. In January, Pfizer made
supplemental submissions to the FDA resulting in a 90-day extension of the NDA review period. As previously stated, Pfizer
hopes to launch Zeldox in the second half of 1998.
Mr. Steere also noted that during the quarter Pfizer signed significant agreements with G.D. Searle & Co., the pharmaceutical
division of Monsanto Company, covering the co-development and co-promotion of Celebra (celecoxib), a breakthrough
medicine initially being developed for the treatment of arthritis and pain, discovered by Searle. The worldwide agreements,
which include a second-generation product as well, exclude only Japan. Searle has said it plans to file an NDA for Celebra with
the FDA and international regulatory officials to treat arthritis and pain during the third quarter of this year.
''We are very pleased that Searle has chosen us as its co-promotion partner,'' Mr. Steere said. ''This promises to be an
outstanding new medicine for the treatment of arthritis and pain with a greatly improved side-effects profile.''
FIRST-QUARTER SEGMENT PERFORMANCE
Pharmaceuticals
Worldwide revenues of Pfizer Pharmaceuticals Group were $2,627 million, an increase of 16 percent over the same period last
year. Excluding the effect of foreign exchange, the increase was 21 percent. In the U.S., revenues increased 26 percent to
$1,644 million. International revenues increased 3 percent to $983 million. Excluding foreign exchange, international revenues
increased 13 percent.
Worldwide sales of Norvasc, a calcium channel blocker for the treatment of angina and hypertension, reached $567 million, an
increase of 14 percent. Excluding the effect of foreign exchange, sales increased by 21 percent. Norvasc continues to be the
largest-selling antihypertensive medicine in the world. Widely available around the world, Norvasc continues to be prescribed
by physicians as their treatment of choice owing to its outstanding safety and efficacy profile. Sales of Procardia XL declined by
19 percent to $193 million primarily as a continued effect of the increased emphasis on the newer agent Norvasc. Sales of
Cardura, a selective alpha blocker for the treatment of hypertension and benign prostatic hyperplasia (enlarged prostate),
increased by 10 percent to $169 million.
Worldwide sales of Zoloft, the company's selective serotonin re-uptake inhibitor for the treatment of depression,
obsessive-compulsive disorder and panic disorder, increased by 17 percent to $460 million. One of the leading medicines in its
class, Zoloft continues to benefit from launches in international markets, new indications and increased field-force support.
Trovan was launched in the U.S. early this year, and contributed $41 million in sales. More than 13,000 patients participated in
87 studies involving Trovan and 30 comparator drug regimens, representing the largest clinical trial program in Pfizer history. Its
initial label includes indications for respiratory system infections and surgical prophylaxis. Trovan is the first antibiotic ever
approved for oral prophylactic use in surgery.
Worldwide sales of Zithromax, a broad-spectrum antibiotic, increased by 16 percent to $306 million. This performance was
driven by U.S. sales growth of 28 percent, partially offset by weakness in Europe due to a season for flu and associated
respiratory infections less severe than last year's. Zithromax continues to be the most prescribed brand-name prescription
antibiotic in the U.S.
Sales of Diflucan, the therapy of choice for a wide range of fungal infections, increased by 5 percent worldwide to $229 million.
Diflucan continues to be the largest-selling prescription anti-fungal medicine in the world.
Sales of Zyrtec, an anti-allergy medicine, increased by 58 percent to $82 million.
Alliance revenue was $150 million, reflecting contractual revenue to Pfizer from sales of Lipitor and Aricept.
Medical Technology
Pfizer announced in February that it was reviewing its strategic options regarding the Medical Technology Group (MTG),
including divestiture of all or part of the businesses in public or private transactions. No decisions have as yet been made. In
January, the company completed the sale of the Valleylab electrosurgical products business to United States Surgical
Corporation.
Worldwide reported sales of MTG decreased by 4 percent to $303 million. Excluding sales of Valleylab and the previously
divested Strato/Infusaid business as well as the impact of foreign exchange, MTG sales increased by 9 percent.
Sales of peripheral and coronary stents, used to maintain flow in vessels and passages, increased by 10 percent to $31 million,
driven by increased volume and the reintroduction of a coronary stent in Europe. Angioplasty product sales grew 8 percent to
$27 million, benefiting from the launch of new coronary angioplasty balloons in the U.S. and Europe.
Sales of musculoskeletal products increased by 4 percent to $191 million. Sales of urological products continued to decline (6
percent to $18 million) as a result of the initial impact of competitive pressures from less-invasive therapies.
Animal Health
Sales of the Animal Health Group (AHG) declined by 2 percent, to $290 million for the quarter. AHG was particularly affected
by foreign exchange as more than 60 percent of the segment's sales are made abroad. Excluding the currency effect, sales
increased by 4 percent. Overall performance was negatively affected by weak economic conditions in Asia and drought in
Australia.
In companion-animal products, worldwide sales of Rimadyl, an arthritis treatment for dogs, increased by 15 percent to $16
million, despite initial trade stocking last year associated with the U.S. launch. Rimadyl was launched in a number of European
countries including Germany and Italy. Anipryl, for the treatment of Cushing's disease (an endocrine disorder) in dogs, was
launched in the U.S. in January.
In food-animal products, sales of Dectomax, an anti-parasitic for cattle, swine and sheep, increased by 21 percent to $32
million.
Consumer Health Care
Sales of the Consumer Health Care Group declined by 9 percent to $119 million, reflecting in part reduced trade inventories in
the U.S.
Commentary
Diluted earnings per share (EPS) were 53 cents, a 15-percent increase. Foreign exchange had a strong negative impact on
growth in revenues, net income and EPS. On the other hand, the net of non-recurring and unusual items added 2 cents to EPS.
Those items include, among others, the net gain on the sale of the Valleylab business and initial payments in accordance with the
provisions of agreements with Monsanto, noted above.
David Shedlarz, senior vice president and chief financial officer, said, ''Financial performance for the full year could be
significantly impacted by foreign exchange, despite our currency-hedging programs and the natural hedges offered by the global
scope of our business. At today's exchange rates, the negative effect of currency factors on revenue growth for the full year
would be about three percentage points. In addition, we plan to continue to make those investments in marketing, sales and
research to fully realize the medical and commercial potential of our nearer- and longer-term product opportunities. Our
financial performance this year will depend on the size and timing of these investments, as well as the performance of new and
major in-line products and the impact of foreign exchange.''
Mr. Steere said, ''These are exciting times for Pfizer, given our significant scientific and product opportunities. This year we plan
to increase our R&D investment to more than $2 billion, near the top of the industry, and to make the investments in marketing
and sales needed to maximize the benefits of our major new products. Our strategy is to continue to strike the proper balance
between growth and investment to ensure success today and for years to come.''
Forward-looking statements in this document should be evaluated together with the many uncertainties that affect our business,
particularly those mentioned in the cautionary statements in Part 1 of our 1997 Form 10-K, which we incorporate by reference.
PFIZER INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
(millions of dollars, except per share data)
First Quarter % Inc./
1998 1997 (Dec.)*
Net sales $3,189 $3,002 6
Alliance revenue 150 (1) *
Total revenues 3,339 3,001 11
Costs and expenses
Cost of sales 545 545 0
Selling, informational
and administrative exps. 1,332 1,114 20
Research and development
expenses 505 413 22
Other deductions--net (5) 67 *
Income before provision
for taxes on income and
minority interests 962 862 12
Provision for taxes on
income 269 259 4
Minority interests 1 1 0
Net income $ 692 $ 602 15
Basic earnings per
common share $ .55 $ .48 15
Diluted earnings per
common share $ .53 $ .46 15
* - Calculation not meaningful.
1. The above financial statement presents the periods ended March 29,
1998 and March 30, 1997. Subsidiaries operating outside the United
States generally are included on the basis of interim quarterly
periods ended February 22, 1998 and February 23, 1997.
2. Other deductions--net for the first quarter of 1998 includes a
$194 million gain recognized on the sale of the Valleylab business.
Also included are payments of $100 million to G.D. Searle & Co., the
pharmaceutical division of Monsanto Company, related to the
copromotion and development of Searle's Celebra and its second
generation compound for the treatment of arthritis and pain.
3. The financial results for the period ended March 29, 1998 are not
necessarily indicative of the results which ultimately might be
achieved for the current year.
PFIZER INC
SEGMENT/PRODUCT REVENUES
FIRST QUARTER 1997
(millions of dollars)
QUARTER-TO-DATE
WORLDWIDE U.S. INTERNATIONAL
% % %
1998 1997 Chg 1998 1997 Chg 1998 1997 Chg
TOTAL
REVENUES 3,339 3,001 11 2,005 1,670 20 1,334 1,331 3
PHARMA-
CEUTICALS 2,627 2,258 16 1,644 1,301 26 983 957 3
-CARDIOVASCULAR
DISEASES 969 922 5 538 531 1 431 391 10
NORVASC 567 497 14 259 219 18 308 278 10
PROCARDIA XL 193 239 (19) 193 239 (19) 0 0 --
CARDURA 169 154 10 84 70 20 85 84 2
-INFECTIOUS
DISEASES 757 682 11 433 325 33 324 357 (9)
DIFLUCAN 229 218 5 118 100 18 111 118 (5)
ZITHROMAX 306 264 16 232 181 28 74 83 (11)
TROVAN 41 0 -- 41 0 -- 0 0 --
UNASYN 88 90 (3) 38 39 (3) 50 51 (3)
SULPERAZON 32 34 (5) 0 0 -- 32 34 (5)
-CENTRAL NERVOUS
SYSTEM
DISORDERS 476 404 18 385 338 14 91 66 38
ZOLOFT 460 394 17 381 334 14 79 60 31
-DIABETES 71 57 23 62 48 30 9 9 (8)
GLUCOTROL XL 58 42 40 56 40 42 2 2 1
GLUCOTROL 7 9 (26) 5 7 (32) 2 2 (3)
-ARTHRITIS/
INFLAMMATION 53 65 (19) 3 3 (13) 50 62 (19)
FELDENE 48 59 (18) 3 3 (13) 45 56 (19)
-ALLERGY 84 54 56 83 53 58 1 1 (16)
ZYRTEC/
REACTINE 82 52 58 81 51 60 1 1 (16)
-ALLIANCE
REVENUE * 150 (1) -- 139 (1) -- 11 0 --
MEDICAL
TECHNOLOGY 303 316 (4) 160 167 (4) 143 149 (4)
ANIMAL HEALTH 290 295 (2) 114 107 8 176 188 (7)
CONSUMER
HEALTH CARE 119 132 (9) 87 95 (8) 32 37 (12)
* - 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. |
