Pfizer 3Q report to focus on pipeline, new drugs

TRENTON, N.J. -- Pfizer Inc., the world's biggest drugmaker by revenue, will focus on progress on key experimental drugs, recent drug approvals and its ongoing corporate makeover when it reports third-quarter results before the stock market opens Tuesday.

WHAT TO WATCH FOR: CEO Ian Read will update investors on plans for two segments of the New York-based company, part of his effort to divest nonpharmaceutical businesses and boost shareholder returns.

Pfizer is planning to close a deal to sell its nutrition business for $11.85 billion to Swiss food and drink giant Nestle SA by the first half of next year. In August it announced plans for an initial public offering of up to 20 percent of its animal health business, to be called Zoetis. Analysts will want details _ and news on how the proceeds will be used.

Read is also sure to note that two drugs that could be big new sellers for Pfizer _ for rheumatoid arthritis and for preventing strokes _could be approved over the next five months, giving the company some new revenue to replace huge losses from generic competition to cholesterol blockbuster Lipitor.

Pfizer executives will note that the Food and Drug Administration is set to decide by Nov. 21 whether to approve tofacitinib, for the immune disorder rheumatoid arthritis. The FDA also has set a new target date of March 17 to decide whether to approve Eliquis, the anticlotting drug Pfizer's been developing with partner Bristol-Myers Squibb Co. It's meant to prevent strokes and embolisms, or potentially fatal blood clots.

The FDA rejected Eliquis earlier this year, and the companies have since submitted new data. Eliquis is also under review in the European Union. However, two drugs already approved in the same new generation of clot preventers _ Boehringer Ingelheim's Pradaxa and Xarelto from partners Johnson & Johnson and Bayer HealthCare _ have been gobbling up market share.

Meanwhile Pfizer's lung cancer pill Xalkori , also known as crizotinib, won conditional European Union approval Wednesday for use in patients with a particular genetic mutation. Regulators there will decide whether to grant full approval after Pfizer submits data from a recently completed study.

In September the FDA approved Pfizer's Bosulif for treating chronic myeloid leukemia, a rare blood cancer that causes a buildup of unhealthy white blood cells. That drug also is for patients with a specific genetic variation _ a thrust of much of Pfizer's current research on cancer and some other drugs.

Analysts are sure to ask for a status update on another high-profile drug, bapineuzumab for Alzheimer's disease that Pfizer has been developing with partner Johnson & Johnson. An intravenous version of the drug failed to work in a of couple studies, leading J&J to take a $340 million charge. It's unclear whether remaining studies, on a form injected just under the skin, will prove the drug is useful.

Analysts also may ask about two kidney cancer drugs already on the market, Inlyta and Torisel, that were being tested for use in additional groups of patients and didn't work as hoped.

Pfizer may note a new study found its smoking cessation pill Chantix didn't cause psychiatric problems in patients with depression. Concerns the drug might cause suicidal thoughts have hurt sales, and Pfizer now faces about 2,400 lawsuits related to the drug's psychiatric side effects.

WHY IT MATTERS: Pfizer needs to rebuild its revenue base to make up for sales lost to new generic competition this year. That's hurt multiple drugs, most importantly its cholesterol fighter Lipitor. It was the world's top-selling drug for many years and still brought in nearly $11 billion in worldwide sales last year. Other drugs with new generic competition include blockbuster schizophrenia drug Geodon, blood pressure and cholesterol combo pill Caduet and Revatio for high blood pressure in lung arteries.

So after several years of highly touted experimental drugs unexpectedly failing in expensive, late-stage patient testing, Pfizer seems to have emerged from that slump at just the right time with some recently approved cancer drugs and other approvals on the horizon.

WHAT'S EXPECTED: Analysts surveyed by FactSet expect, on average, forecast earnings of 52 cents per share and revenue of $14.66 billion.

LAST YEAR'S QUARTER: Pfizer posted earnings of $3.74 billion, or 48 cents per share, on revenue of $17.2 billion.


Linda A. Johnson can be followed at