Pfizer Swings to 4Q Profit After Rough Year, Hikes 2017 View

(AP) -

Pfizer predicted slightly higher sales and profit this year after a difficult 2016, though reduced spending on administration, sales, marketing and lawsuits helped it swing to a fourth-quarter profit.

The biggest U.S. drugmaker still missed profit expectations, but it edged past revenue projections.

The drugmaker on Tuesday reported net income of $775 million, or 13 cents per share, versus a loss of $172 million a year ago.

Excluding one-time items, profit was 47 cents per share, three cents below analyst estimates. Quarterly revenue totaled $13.63 billion, just above the $13.55 billion Wall Street had expected.

“As we look at the year ahead, Pfizer’s well positioned,” CEO Ian Read told analysts on a conference call.

Company executives cited approval last year of new medicines for eczema and pain, approvals of three existing drugs for use in additional patient groups and possible approval this year of a new cancer drug.

In an interview with The Associated Press, Read stuck to his position that the problem isn’t soaring drug prices but insurers pushing more costs onto patients. He said Pfizer won’t pledge that it will limit annual price increases, as a few rivals recently did. Pfizer typically raises the list price on all of its drugs about 10 percent twice each year, though wholesalers and other middlemen get much of those increases.

Meanwhile, executives of several other big drugmakers met Tuesday with President Trump, who called for lower drug prices but less regulation, saying that could speed up drug approvals and increase competition.

Revenue edged up 1 percent in the U.S., where Pfizer makes about half its sales, but fell 7 percent elsewhere.

Pfizer’s Innovative Health segment, which sells newer, patent-protected medicines, reported worldwide fourth-quarter sales of $7.73 billion, up just 1 percent. Sales were driven by better-than-expected revenue. However, its top seller, the Prevnar 13 vaccine against pneumonia, ear and other common infections, had sales plunge 24 percent to $1.42 billion, as the number of unvaccinated adult Americans has dropped.

Sales fell 8 percent to $5.9 billion at Pfizer’s essential health business, which markets older, mostly off-patent drugs, mostly due to lower overseas sales.

Sales of consumer health products such as Advil pain reliever, Chapstick and Centrum vitamins increased 2 percent to $950 million.

Pfizer Inc., based in New York, said it expects 2017 earnings in the range of $2.50 to $2.60 per share, with revenue in the range of $52 billion to $54 billion. Analysts were expecting earnings of about $2.59 per share and revenue of $54.5 billion.

For all of 2016, Pfizer reported net income of $7.2 billion, or $1.17 per share, on revenue of $52.8 billion.

Last year, the Obama administration blocked Pfizer’s attempt to acquire the Irish drugmaker Allergan in a maneuver to reduce Pfizer’s U.S. tax rate that would have moved its headquarters, just on paper, to Dublin.

Pfizer also scrapped development of a high-priced new cholesterol drug once viewed as a big seller, as sales expectations dropped amid increasing pressure for lower prices from insurers and prescription benefit managers. And Pfizer decided in September not to split into two companies to accelerate growth — a move some analysts had hoped would boost Pfizer’s lagging stock price.

Pfizer said it expects to buy back another $5 billion of its shares in 2017.

In trading Tuesday afternoon, Pfizer shares rose 35 cents, or 1.1 percent, to $31.66.