Pfizer Inc reported higher third-quarter profit as aggressive cost-cutting helped offset the negative foreign exchange impact and declining sales of drugs, including those facing competition from cheaper generics.
Despite slow growth of some newer drugs and declines for most of its established medicines, lower costs and job cuts allowed Pfizer to top Wall Street expectations for the quarter, sending its shares 1.8 percent higher in premarket trading.
The world's biggest drugmaker, which got much bigger last week with completion of a $67.3 billion acquisition of Wyeth, posted a net profit of $2.88 billion, or 43 cents per share in its last pre-merger quarter, compared with a profit of $2.28 billion, or 34 cents per share, a year ago.
Excluding items, Pfizer earned 51 cents per share, exceeding analysts' average expectations by 3 cents, according to Thomson Reuters I/B/E/S.
Sales declined 3 percent to $11.6 billion, but that topped analysts' estimates of $11.41 billion.
Pfizer's bought Wyeth to help soften the 2011 blow from the loss of U.S. patent protection on the cholesterol drug Lipitor — the world's biggest-selling prescription medicine — by adding Wyeth's lucrative vaccines and injectable biologic medicines.
Lipitor's worldwide sales for the third quarter declined 9 percent to $2.9 billion. They were down 12 percent in the United States, amid competition from cheap generic versions of rival cholesterol-lowering drugs.
Pfizer updated its full year forecast to include Wyeth sales and operations following the October 15 closing of the acquisition — its third mega-deal in the last nine years after swallowing up Warner-Lambert in 2000 and Pharmacia in 2003.
The company now expects revenue of $49 billion to $50 billion and adjusted earnings of $2.00 to $2.05 per share, up from its pre-Wyeth view of $1.30 to $1.45 per share.
Pfizer said its results were helped by a reduction in workforce to about 75,400 at the end of the third quarter, a decline of 1,100 jobs in the quarter and 6,500 from the start of the year.
Revenue was hurt by about 5 percent due to foreign currency exchange rates, but helped 2 percent due to an adjustment in the year-ago quarter for product returns, the company said.
Shares rose 1.8 percent to $18.30 in premarket trading.
