It's now become painfully clear to investors why global pharmaceutical giant Pfizer (NYSE: PFE ) is so aggressively pursuing a purchase of rival AstraZeneca following disappointing first-quarter results reported today by Pfizer.
For the quarter, revenue tumbled more than $1 billion from the previous year, or 8.5%, to $11.35 billion. Revenue at both the company's established pharmaceutical segment and innovative pharmaceutical segment dipped 13% and 7%, respectively, while oncology drugs partially offset the decline with a revenue increase of 7%. As Pfizer's report shows, $364 million of its drop was tied directly to unfavorable currency translation.
However, the primary culprit for Pfizer's reduced sales figures was ongoing patent losses in a number of key drugs. Cholesterol-lowering medication Lipitor, and the all-time best-selling drug, saw sales dip by 27% to $457 million, while sales of erectile dysfunction therapy Viagra fell 19% to $374 million. Sales of osteoarthritis and rheumatoid arthritis medication Celebrex also fell 4% to $624 million ahead of its upcoming patent loss later this year.
Partially offsetting these losses was an 8% sales improvement in current best-selling drug Lyrica to $1.15 billion, and strong growth from cancer drugs Inlyta and Xalkori, up 40% and 66%, respectively to $88 million each.
In spite of a notable decline of 5% in research and development costs and a 6% drop in selling, general and administrative expenses, profit for the quarter dipped 15.3% to $2.33 billion, or $0.36 per share from $2.75 billion, $0.38 or per share, in the prior-year period. Pfizer repurchased close to 800 million shares over the trailing 12-month period, thus the smaller drop in its EPS.
Looking ahead, Pfizer stuck by its full-year forecast which calls for revenue of $49.2 billion-$51.2 billion and adjusted EPS of $2.20-$2.30.