It hasn't been a good year for Pfizer (NYSE:PFE). Let's review some of the carnage.

  • Pfizer's patent for Zithromax, formerly a blockbuster antibiotic with more than $2 billion in sales, expired in late 2005, and the sales of the drug declined precipitously in 2006 when competition from generics kicked in.

  • Zoloft, the world's best-selling antidepressant, with sales exceeding $3 billion, went off patent this summer.

  • The U.S. patent for Norvasc, the world's best-selling blood pressure medication, will expire in 2007.

  • The patent on allergy drug Zyrtec will also expire next year.

  • Pfizer's flagship product, Lipitor, the world's best-selling drug bar none, came under pressure from simvastatin, the generic version of Zocor.

  • Pharmaceutical-benefits manager Express Scripts (NASDAQ:ESRX) took Lipitor off its 2006 list of preferred drugs, which has resulted in diminished sales.

  • CEO Hank McKinnell was ousted prematurely because of his $83 million retirement package -- widely criticized as excessive -- and Pfizer's poor stock performance.

What could be worse for a company than trying to grow revenues and profits while many of its blockbuster drugs go off patent? Well, getting sued all over the country, having one of your best-selling medications abruptly taken off the shelves because it causes heart attacks, and being accused of manipulating scientific research is much worse. That's what happened to Merck (NYSE:MRK) after Sept. 30, 2004, which will live in infamy for the company's shareholders as the day Vioxx was taken off the market.

But articles published recently in two major medical journals may give Pfizer and its Celebrex drug a glimmer of hope. Before September 2004, three anti-inflammatory drugs that inhibit the COX-2 enzyme -- Pfizer's Celebrex and Bextra, and Merck's Vioxx -- were widely prescribed to treat muscular aches and arthritis. Touted as being safer than older medications such as ibuprofen or Aleve naproxen, all three drugs sold well and had bright futures. In 2004, Celebrex sales were $3.3 billion.

Celebrex is the only drug of the three still on the market, and although it's still noted as increasing the risk of heart problems, it has also proved less dangerous than Vioxx, and the FDA has made no move to take Celebrex off the market or to change its labeling.

The FDA had slapped Celebrex with a safety warning after Vioxx and Bextra were removed from the market, and its future was in doubt as the safety of all three drugs came into question. That meant the results of two major trials on Celebrex had been anxiously awaited. If Celebrex was proved to be a reasonably safe drug, its status as the remaining COX-2 enzyme inhibitor would ensure a virtual monopoly, and it could become quite profitable. If it was not deemed safe, we might see Vioxx part 2. (Was it purely coincidental that earlier this year Pfizer chose Jeffrey Kindler, a seasoned lawyer, to become its CEO?)

Those results have now been published. The Aug. 31 edition of the New England Journal of Medicine published two articles about two large Celebrex trials that looked at whether the drug reduced the risk of colon polyps, the precursors of colon cancer. More importantly, these long-term trials provided the best answer as to whether taking Celebrex increases the risk of heart attacks, strokes, or heart failure.

The studies showed that patients taking Celebrex had fewer polyps but additional heart problems. The risk of more heart trouble far outweighed the benefit of fewer polyps. Depending on how much Celebrex was taken, patients who took the drug doubled (or more) their risk of heart trouble compared with those who did not, and patients taking increasingly higher doses of Celebrex had an increasingly higher risk of developing heart problems. Sounds like bad news, right?

More recently, the Oct. 4 edition of the Journal of the American Medical Association published two large review articles concerning the safety of COX-2 medications by combining data from many trials. It also published an editorial from Dr. David Graham, the FDA whistleblower who was openly critical about the FDA's decision to not remove Vioxx from the market sooner.

Dr. Graham posits, "If COX-2 inhibitors cost substantially more, confer substantially greater cardiovascular risk, and offer no unique and meaningful gastrointestinal tract benefit over generic naproxen plus proton pump inhibitor [for example, taking a combination of generic Aleve with generic Prilosec], is there any point to the continued use of these drugs?"

Sounds like even more bad news. But practically speaking, what do these studies mean for patients, doctors, Pfizer, and U.S. taxpayers -- who, by funding Medicare and veterans' health care, are the world's largest purchasers of Celebrex?

First, we can conclude that patients with known heart disease or those at substantial risk for heart disease should not be taking Celebrex. Second, physicians can consider prescribing low doses of Celebrex to patients who have no heart disease, are at low risk for developing heart disease, and are not helped by any other pain medication. Third, the bad news paradoxically may be good news for Pfizer. The studies were bound to show that patients taking Celebrex had some risk for developing heart problems anyway, but they also showed that the risks associated with taking Celebrex are less than with taking Vioxx, which is what the company had thought. Again, the FDA is not publicly talking about pulling the drug or altering its indications. And fourth, despite Dr. Graham's questioning of why people would buy an expensive pain medication with more side effects lacking scientifically demonstrable benefit, there is no indication that Medicare will restrict its paying for Celebrex in the near future.

The bad news could have been much worse. Even better news for Pfizer is that Celebrex's most recent quarterly worldwide sales were $471 million, a 17% increase over the same period last year.

Its prospects have not looked this good in years.

Pfizer is a Motley Fool Inside Value recommendation. Looking for the market's best bargains? Try out Inside Value free for 30 days.

Merck is a former Motley Fool Income Investor pick.

Fool contributor Michael P. Cecil, M.D., is a cardiologist and the author of Drugs for Less: The Complete Guide to Free and Discounted Prescription Drugs. You can email him to discuss this article.Dr. Cecil does not own any of the stocks mentioned in the article.The Fool has a disclosure policy.