The world's biggest drug company is seeing its market value get much smaller this morning. Shares of Pfizer are getting hammered after the company dropped a bombshell over the weekend about clinical trials of torceptrapib/atorvastatin (T/A), a drug thought to be a promising new way to lower cholesterol. CNBC’s Mike Huckman sorted out all the details on this morning’s “Squawk Box.”
Two days after Pfizer told Wall Street at a big R&D meeting that it hoped to file for FDA
approval of its next generation cholesterol pill in the second half of next year--the company abruptly pulled the plug on it.
Torcetrapib was considered the heir to the Lipitor throne. Tests showed the drug taken in combination with Pfizer's mega blockbuster Lipitor raised good and lowered bad cholesterol. It also caused blood pressure to go up. But on Friday--the independent Data Safety Monitoring Board saw for the first time that it also increased the risk of heart attack and death. There were 31 more deaths among people on the Torcetrapib Lipitor combo versus Lipitor alone.
Pfizer officials got the news early Saturday morning--held an emergency meeting at headquarters in Manhattan and made what one executive calls "an immediate decision" to go full stop. That executive told Huckman there was "no doubt that what we found was real."
For Pfizer this is a huge blow--but not for medicine according to Dr. Steven Nissen. He's one of the lead Torcetrapib investigators and says all is not lost. “First of all understand that this study was stopped promptly – this was the right thing to – we’re going to move forward. We’re going to find new medicines but its hard to do that it’s a risky business."
Coming up on CNBC’s “Power Lunch” at 12 noon ET today--a live interview here with new Pfizer CEO Jeff Kindler. This will be his first TV interview since taking over the company 4 months ago.
Pfizer says approximately 12,500 people around the world have taken Torcetrapib in clinical trials. If they're still on it, they should stop taking it immediately. In the test that saw the increased risk of death, Pfizer says patients had been on the drug on average for 18 to 20 months.
Also this morning on CNBC--Huckman and "Squawk Box" host Joe Kernan spoke with Tony Butler who is Senior Pharmaceuticals Analyst and co-head of Global Pharmaceuticals at Lehman Brothers about the impact of the news on stock price.
Butler said he's asking where does revenue growth go from here - how will Pfizer fill in the revenue loss now, when the patent on Lipitor expires in 2011? He said it seems that revenue will either be flat or decline.
Analyst disclosure:Lehman Brothers does own Pfizer shares.