Pfizer 2017: Beyond The Blockbusters
Pfizer is overcoming patent expirations by developing a steady new stream of products.
Pfizer Inc.
235 E. 42nd Street
New York, NY 10017
Phone: 212-733-2323
Website: pfizer.com
Best-Selling Products
| Product | 2016 Sales | 2015 Sales |
|---|---|---|
| Prevnar, Prevenar 13 | $5,718 | $6,245 |
| Lyrica | $4,966 | $4,839 |
| Enbrel | $2,909 | $3,333 |
| Ibrance | $2,135 | $723 |
| Lipitor | $1,758 | $1,860 |
| Viagra | $1,564 | $1,708 |
| Sutent | $1,095 | $1,120 |
| Premarin family | $1,017 | $1,018 |
| Norvasc | $962 | $991 |
| Xeljanz | $927 | $523 |
| Chantix/Champix | $842 | $671 |
| Celebrex | $733 | $830 |
| Pristiq | $732 | $715 |
| BeneFIX | $712 | $752 |
| Vfend | $590 | $682 |
| Genotropin | $579 | $617 |
| Xalkori | $561 | $488 |
| Refacto AF, Xyntha | $554 | $533 |
All sales are in millions of dollars.
Financial Performance
| 2016 | 2015 | |
|---|---|---|
| Revenue | $52,824 | $48,851 |
| Net income | $7,215 | $6,960 |
| Diluted EPS | $1.17 | $1.11 |
| R&D expense | $7,872 | $7,690 |
| 1H 2017 | 1H 2016 | |
|---|---|---|
| Revenue | $25,675 | $26,152 |
| Net income | $6,194 | $5,085 |
| Diluted EPS | $1.02 | $0.82 |
| R&D expense | $3,487 | $3,478 |
In millions of dollars, except for EPS
For Pfizer, “2016 was a year of significant progress across each of our strategic imperatives,” according to Ian Read, chairman and CEO. “We have advanced the pipeline and transformed our approach to R&D, launched multiple products addressing patients’ unmet medical needs, wisely invested our capital to drive growth, worked to expand access to our medicines and vaccines, and prioritized our time and resources to create a strong and sustainable culture.”
Read says 2016 was a strong year with continued operational growth and ongoing progress in developing high-value medicines and vaccines.
“Six years ago, we put in place a long-term strategy to position Pfizer for a return to topline growth,” Read says. “The strategy is anchored on four imperatives that have guided our actions at every level of the organization.”
“We have a strong pipeline with a steady flow of scientific innovation coming from all of our key therapeutic areas. Over the next five years, we project the potential for approximately 25 to 30 approvals of which up to 15 have the potential to be blockbusters, and we believe half of these potential blockbusters could receive approval by 2020. Our strategy remains focused on maximizing in-market opportunities while continuing to advance the pipeline and managing our cost structure to deliver attractive financial performance over time,” says Ian Read, Pfizer CEO.
According to Read, 2016 marked a year of solid execution with substantial contributions across every part of the enterprise.
“We ended the year by achieving our second consecutive year of operational revenue growth after overcoming more than $23 billion in brand patent expiries between the years of 2011–2016,” he says, “We received five product approvals, achieved six regulatory submissions and advanced 39 compounds in our pipeline. Each of our commercial businesses grew operationally, we advanced several initiatives that expanded access to our medicines and vaccines, and further embedded a strong culture of ownership and accountability across the organization.”
Financial & Product Performance
Company executives say 2016 marked another year of operational revenue growth and strong financial performance on behalf of Pfizer’s shareholders. The company returned $12.3 billion to shareholders through share repurchases and dividends, and sustained its eight-year record of increasing dividends.
“Since embarking on our current strategy in 2011, we have returned nearly $90 billion to our shareholders through share repurchases of approximately $50 billion and dividends of approximately $40 billion, and the price of Pfizer shares has increased approximately 79 percent, (Dec. 31, 2010 to Jan. 27, 2017), in line with the S&P 500 (+~80 percent),” Read says.
In 2016, the company recorded revenue of $52.82 billion, 8 percent more than in 2015. Net incomes rose 3.7 percent to $7.22 billion, and diluted earnings per share were $1.17, and increase of 5.5 percent from 2015.
In 2016, Pfizer concluded an extensive assessment of its commercial businesses – Pfizer Essential Health and Pfizer Innovative Health. “We concluded that shareholders would benefit best from our continuing to operate these two businesses within Pfizer, taking advantage of our operational strength and financial flexibility,” Read says.
In 2016, executives say Pfizer Innovative Health achieved strong revenue growth due to the performance of a differentiated and diverse group of new and older products, including the breast cancer drug Ibrance, the vaccine Prevnar 13, the rheumatoid arthritis drug Xeljanz, the neuropathic pain drug Lyrica, and the anti-smoking drug Chantix.
Pfizer Essential Health established market-leading positions in sterile injectables with more than 250 products, biosimilars with three marketed products and the industry’s largest anti-infectives portfolio with approximately 80 assets globally. The anti-infectives portfolio was further bolstered through the acquisition of AstraZeneca’s small molecule anti-infectives portfolio primarily outside of the United States.
The Essential Health business also includes many of Pfizer’s long-established products such as Lipitor and Celebrex.
Pfizer’s leading product in sales in 2016 was the vaccine Prevnar 13, which generated $5.72 billion, 8.4 percent less than in 2015. Executives say the decrease was primarily driven by an expected decline in revenues for the adult indication in the United States due to a high initial capture rate of the eligible population following its fourth-quarter 2014 launch, which resulted in a smaller remaining “catch up” opportunity compared to the prior year, as well as the unfavorable impact of the timing of government purchases for the pediatric indication (down approximately $450 million). About one out of two adults over age 65 in the United States has been vaccinated with Prevnar 13.
Sales in the first half of 2017 were $2.55 billion, almost 8 percent less than in the same period last year. In the United States, Prevnar 13 sales decreased 16 percent, primarily due to the unfavorable timing of government purchases for the pediatric indication and the continued decline in revenues for the adult indication due to the smaller remaining “catch up” opportunity compared to the prior-year quarter.
Prevenar 13 sales in international markets increased 8 percent operationally, primarily due to the favorable timing of government purchases in certain emerging markets for the pediatric indication.
Pfizer’s No. 2-selling product Lyrica is approved by the U.S. Food and Drug Administration to treat fibromyalgia, diabetic nerve pain, spinal cord injury nerve pain, and pain after shingles. Lyirca is additionally indicated to treat partial onset seizures in adults with epilepsy who take one or more drugs for seizures.
No. 2 in 2016 sales was Lyrica, at $4.97 billion, 2.6 percent more than in 2015. First-half 2017 sales totaled $2.23 billion, an increase of 8.4 percent compared with first-half 2016.
Pfizer’s second-quarter 2017 operational growth was negatively impacted by lower revenues for Enbrel in most developed Europe markets, primarily due to continued biosimilar competition.
The rheumatoid arthritis drug Enbrel was the third best-selling product for Pfizer in 2013, at $2.91 billion, 14.6 percent less than in 2015. In the first half of 2017, sales decreased to $1.21 billion, 24.5 percent less than in the same period last year.
Ibrance, for certain types of breast cancer, was Pfizer’s No. 4 product in 2016. The drug generated sales of $2.14 billion compared with $723 million in 2015. Ibrance has been launched in more than 50 countries. Sales in the first half of 2017 amounted to $1.53 billion, 62.6 percent more than in the first half of 2016.
The statin Lipitor was the fifth best-selling drug for the company in 2016, at $1.76 billion, 5.5 percent less than in 2015. Sales in the first half of this year were $849 million, 2.7 percent less than in first-half 2016.
The erectile dysfunction drug Viagra was No. 6 for Pfizer in 2016, at $1.56 billion, 8.1 percent less than in 2015. First-half 2016 sales were $687 million, 14 percent less than in the same period last year.
Coming in seventh in 2016 sales was the cancer drug Sutent, at $1.1 billion, an increase of 6.3 percent compared with 2015. In the first half of 2017, Sutent sales were recorded at $529 million, 8 percent less than in the same period of 2016.
The Premarin family of products for menopausal symptoms generated 2016 global revenue of $1.02 billion, about the same amount as in 2015.
The hypertension drug Norvasc was No. 9 in Pfizer sales for 2016. The product posted $962 million, 2.9 percent less than in 2015. In the first half 0f 2017, sales were $458 million, 4 percent less than in first-half 2016.
Coming in at No. 10 in 2016 sales was Xeljanz, at $927 million compared with $523 million in 2015. Sales in the first half of 2017 were $582 million, 42 percent more than in the first half of last year.
Pfizer’s 11th best seller in 2016 was the smoking cessation drug Chantix/Champix. The drug generated $842 million, 25.5 percent more than in the previous year. Chantix sales in the first half of 2017 were $487 million, 12 percent more than in the first half of 2016. Executives say sales were spurred by the removal in 2016 by U.S. and EU regulators of the boxed warning/black triangle from the product’s labeling. These actions were based on EAGLES, the largest smoking cessation clinical trial of its kind. “We expect this revision will help many more individuals to discuss quitting smoking with health care providers,” management says.
No. 12 in 2016 sales was the nonsteroidal anti-inflammatory drug Celebrex, which generated $733 million, 13.2 percent less than in 2015. Sales in the first half of 2017 were $353 million, 1 percent less than in the same period last year. In 2016, a 10-year study of over 24,000 osteoarthritis or rheumatoid arthritis (RA) patients with or at a high risk for cardiovascular disease and who required daily treatment with nonsteroidal anti-inflammatory drugs (NSAIDs), did not experience a greater cardiovascular risk when treated with Celebrex as compared to patients receiving prescription doses of ibuprofen and naproxen.
Coming in at No. 13 in Pfizer’s 2016 sales was Pristiq. The antidepressant posted $732 million, 2.4 percent more than in 2015. In first-half 2017, sales were $161 million, 57 percent less than in the same period last year. Sales declined after the drug lost patent protection in the United States in March 2017.
Pfizer’s 14th best-selling product in 2016 was the hemophilia drug BeneFIX, which generated $712 million, 5.3 percent less than in 2015. The Factor IX inhibitor posted sales of $302 million in first-half 2016, 18 percent less than in first-half 2015.
No. 15 in 2016 sales was Vfend. The antifungal posted $590 million, 13.3 percent less than in 2015. In the first half of 2017, sales came in at $208 million, 35 percent less than in the same period last year.
In 2016 the company’s 16th best-selling prescription product was the growth hormone Genotropin. The product had sales of $579 million, 6.2 percent less than in 2015. First-half 2016 sales were $83 million, 11 percent less than in the first half of 2016.
Ranking as the 17th best-selling pharma product for Pfizer in 2017 was Xalkori with sales of $561 million. Approved for treating ALK-positive NSCLC and ROS1-positive NSCLC, the product during the first six months of 2017 produced global sales of $296 million, representing an 8 percent year-over-year increase.
Pfizer’s No. 18 drug in 2016 sales was the ReFacto AF and Xyntha franchise. The hemophilia products posted $554 million, 3.9 percent more than in 2015. During the first half of 2017, sales came to $141 million, 10 percent less than in the same period last year.
Executives say business in 2016 was further strengthened with the addition of new products, including Eucrisa for mild to moderate atopic dermatitis and Xtandi for men with metastatic castration-resistant prostate cancer.
Additionally, Pfizer Essential Health established market-leading positions in sterile injectables with more than 250 products, biosimilars with three marketed products and the industry’s largest anti-infectives portfolio with 80 assets globally. The anti-infectives portfolio was further bolstered through the acquisition of AstraZeneca’s small molecule anti-infectives portfolio primarily outside of the U.S.
Eliquis, which is jointly promoted with Bristol-Myers Squibb and sales of which Pfizer accounts for as alliance revenue, became cardiologists’ top prescribed oral anticoagulant in 12 countries.
R&D Innovation
During 2016 and in the first half of 2017, Pfizer issued a steady stream of news about products in its pipeline.
In July 2017, Merck KGaA and Pfizer announced that the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) recommended the approval of Bavencio as a monotherapy for the treatment of adult patients with metastatic Merkel cell carcinoma (mMCC), a rare and aggressive skin cancer.
Bavencio was previously granted accelerated approval in May from the U.S. Food and Drug Administration for the treatment of adults and pediatric patients 12 years and older with mMCC based on tumor response and duration of response.
In September, the European Commission granted marketing authorization for Bavencio. The drug will have marketing authorization in the 28 countries of the European Union in addition to Norway, Liechtenstein, and Iceland. Bavencio is expected to become commercially available to patients in Europe by prescription within the coming months, with initial launches in Germany and the United Kingdom expected as early as October 2017.
“This European approval further establishes our continued momentum, building on the accelerated approvals Bavencio received in the United States earlier this year,” says Liz Barrett, global president, Pfizer Oncology. “Importantly, we are now one step closer to our goal of making Bavencio available to patients around the world.”
In June 2017, Pfizer announced that the EC approved Besponsa as monotherapy for the treatment of adults with relapsed or refractory CD22-positive B-cell precursor acute lymphoblastic leukemia (ALL).
This indication includes treatment of adults with Philadelphia chromosome positive (Ph+) as well as Philadelphia chromosome negative (Ph-) relapsed or refractory B-cell precursor ALL. Adults with Ph+ relapsed or refractory CD22-positive B-cell precursor ALL should have failed treatment with at least one tyrosine kinase inhibitor. With this approval, Besponsa became the first antibody drug conjugate (ADC) available for patients with this type of leukemia in the European Union.
In the United States, Besponsa received Breakthrough Therapy designation from the FDA in October 2015 for ALL. A Biologics License Application (BLA) for Besponsa for the treatment of adult patients with relapsed or refractory B-cell precursor ALL was accepted for filing and granted Priority Review by the FDA in February 2017.
In August 2017, Pfizer received FDA approval for Besponsa. “The approval of BESPONSA is an important step forward for adult patients with relapsed or refractory B-cell acute lymphoblastic leukemia, a rare disease that can be fatal within a matter of months if left untreated,” Barrett says.
“Besponsa will help address a significant need for new treatment options in B-cell acute lymphoblastic leukemia, and may help more patients reach stem cell transplant, which provides the best chance for long term remission.”
In July 2017, Pfizer announced that the FDA’s Oncologic Drug Advisory Committee voted 6-1 that Mylotarg in combination with chemotherapy has a favorable risk-benefit profile for patients with newly diagnosed CD33-positive acute myeloid leukemia (AML). FDA approved the drug in September for adults with newly diagnosed CD33-positive AML, and adults and children 2 years and older with relapsed or refractory CD33-positive AML. Mylotarg is the first therapy with an indication that includes pediatric AML and is also the only AML therapy that targets CD33, an antigen expressed on AML cells in up to 90 percent of patients.
In June 2017, Pfizer announced that it received a Complete Response Letter (CRL) from the FDA regarding the company’s BLA for its proposed epoetin alfa biosimilar. This CRL relates to matters noted in a Warning Letter issued in February 2017 following a routine FDA inspection of Pfizer’s manufacturing facility in McPherson, Kansas, in 2016. This facility was listed as the potential manufacturing site in the BLA for the proposed epoetin alfa biosimilar. The issues noted in the Warning Letter do not relate specifically to the manufacture of epoetin alfa. No additional clinical data was requested in the CRL.
An ODAC voted in May 2017 to recommend this proposed biosimilar for approval.
Also in May 2017, Pfizer announced that a supplemental New Drug Application (sNDA) for Sutent was accepted for filing by the FDA. If approved, the sNDA would expand the approved use of Sutent to include use as an adjuvant treatment in adult patients at high risk of recurrent renal cell carcinoma (RCC) following nephrectomy (surgical removal of the cancer-containing kidney). In addition, the EMA has validated for review a Type II Variation application for Sutent in the same patient population.
The PDUFA goal date for a decision by the FDA is in January 2018. In September 2017, the ODAC voted 6 in favor and 6 against the benefit-risk profile for Sutent as adjuvant treatment of adult patients at high risk of recurrent RCC after nephrectomy.
“We are encouraged by today’s productive discussion and look forward to working with the FDA over the next few weeks as they incorporate today’s discussion into their review and decision regarding Sutent in this patient population,” says Mace Rothenberg, M.D., chief development officer, Oncology, Pfizer Global Product Development.
In May 2017, Pfizer announced that the EC approved Trumenba for the prevention of invasive meningococcal disease caused by Neisseria meningitidis serogroup B in individuals 10 years of age and older.
In June 2017, Pfizer announced that the FDA granted Fast Track designation to tafamidis, the company’s investigational treatment for transthyretin cardiomyopathy (TTR-CM).
This rare disease is associated with progressive heart failure and is universally fatal. Currently in Phase III clinical development for TTR-CM, tafamidis is being evaluated for its potential to reduce mortality and cardiovascular-related hospitalizations.
The drug was approved as Vyndaqel in 2011 in the European Union for the treatment of transthyretin familial amyloid polyneuropathy (TTR-FAP) in adult patients with early-stage symptomatic polyneuropathy delay peripheral neurologic impairment and is approved for TTR-FAP in 40 countries. Pfizer received a CRL from the FDA on its application to approve tafamidis for TTR-FAP in 2012.
In July 2017, Pfizer announced that the FDA accepted for review a sNDA for Xeljanz for the treatment of adult patients with moderately to severely active ulcerative colitis. The PDUFA goal date for a decision by the FDA is in March 2018. In May 2017, Pfizer announced that the FDA accepted for review a sNDA for Xeljanz 5 mg twice daily for the treatment of adult patients with active psoriatic arthritis (PsA).
A separate sNDA was also accepted for Xeljanz XR extended release 11 mg once daily use in PsA. The PDUFA goal date for a decision by the FDA is in December 2017.
Astellas Pharma Inc. and Pfizer in June 2017 announced the amendment of the protocol for the registrational PROSPER trial, a multi-national, randomized, double-blind, placebo-controlled study evaluating the efficacy and safety of Xtandi in patients with non-metastatic castration-resistant prostate cancer (CRPC).
The primary endpoint of the PROSPER trial remains the same: metastasis-free survival. The main purpose of the amendment is to revise the plan for the analyses of the primary and several secondary endpoints, which allows for a reduction in the target sample size to approximately 1,440 from 1,560 patients. The companies now anticipate PROSPER top-line results will be disclosed later this year. Previously the expected primary completion date for PROSPER was June 2019.
Xtandi is approved by the FDA for the treatment of patients with metastatic CRPC.
In June 2017, Merck and Pfizer, announced that two Phase III studies (VERTIS MET and VERTIS SITA) of ertugliflozin, an investigational oral SGLT-2 inhibitor in development to help improve glycemic control in adults with type 2 diabetes, met their primary endpoints. In the studies, both doses of ertugliflozin tested (5 mg and 15 mg daily) achieved statistically significant reductions in A1C, a measure of average blood glucose over a two- to three-month timeframe, when added to metformin or in initial co-administration with sitagliptin.
The results of these studies, along with 52-week extension data from three other studies in the VERTIS clinical development program of ertugliflozin, were presented at the 77th Scientific Sessions of the American Diabetes Association.
In July 2017, Pfizer announced that the REFLECTIONS B7391003 study, a comparative, confirmatory safety and efficacy study of PF-06439535 versus Avastin (bevacizumab), met its primary endpoint, demonstrating equivalence of objective response rate of PF-06439535 versus Avastin, both taken in combination with carboplatin/paclitaxel, for the first line treatment of patients with advanced non-squamous non-small cell lung cancer.
In June 2017, Pfizer announced Phase II data showing that its investigational, dual-mechanism poly ADP ribose polymerase inhibitor talazoparib demonstrated anti-tumor activity in patients with germline (inherited) BRCA1/2-positive (gBRCA+) advanced breast cancer.
Results from the Phase II ABRAZO trial were presented during an oral session at the 53rd Annual Meeting of the American Society of Clinical Oncology (ASCO). ABRAZO is an open-label Phase II, two-stage, single arm, parallel cohort study that investigated the clinical efficacy and safety of single-agent talazoparib in 83 evaluable, heavily pretreated gBRCA+ advanced breast cancer patients.
The primary endpoint was objective response rate (ORR) by independent radiology review. Cohort 1 consisted of 49 patients who previously responded to platinum-based chemotherapy and subsequently developed disease progression. A 21 percent ORR (95 percent CI: 10-35) was observed in this group of patients.
Cohort 2 consisted of 35 patients who developed disease progression following at least three lines of non-platinum-based therapy. This group of patients had a 37 percent ORR (95 percent CI: 22-55).
Talazoparib is also being assessed in the open-label Phase III randomized, parallel, two-arm EMBRACA trial. EMBRACA is evaluating talazoparib vs. protocol-specific physician’s choice of chemotherapy in patients with advanced and/or metastatic gBRCA+ breast cancer who have received zero to three prior chemotherapy regimens for advanced disease. The EMBRACA trial has completed enrollment and top-line results are expected by January 2018.
In June 2017, Pfizer and Eli Lilly and Co. announced that the FDA granted Fast Track designation for tanezumab for the treatment of chronic pain in patients with osteoarthritis and chronic low back pain. Tanezumab is an investigational humanized monoclonal antibody that selectively targets, binds to and inhibits nerve growth factor (NGF). Tanezumab is the first NGF inhibitor to receive Fast Track designation.
In 2013, Pfizer and Lilly entered into a worldwide joint development and joint commercialization agreement for the advancement of tanezumab.
Power Of Collaborations
Executives say collaboration is an important element of Pfizer’s overall discovery and early development process. In 2016, the company received breakthrough therapy designation from the FDA for a hemophilia gene therapy being developed in partnership with SPARK Therapeutics Inc.
The company also acquired Bamboo Therapeutics Inc., a privately held biotechnology company based in Chapel Hill, N.C., focused on developing gene therapies for the potential treatment of patients with certain rare diseases including Duchenne muscular dystrophy (DMD) and Friedreich’s ataxia (FA). Through this acquisition Pfizer acquired a number of novel assets, key technology and manufacturing capabilities that executives say position the company to be a leader in this promising area of research that has the potential to be game-changing.
Through the partnership with Lilly, Pfizer has initiated six new Phase III trials to continue the development of tanezumab, a novel potential treatment option for chronic, debilitating pain in patients with osteoarthritis, lower back pain, and cancer.
Pfizer also entered into several research collaborations and business relationships with companies such as Biolnvent International AB, to develop antibodies targeting tumor-associated myeloid cells; and Western Oncolytics to advance its novel oncolytic vaccinia virus, WO-12.
The company also has a relationship with IBM where Pfizer will utilize IBM Watson for drug discovery to help accelerate research in immuno-oncology by identifying potential new targets and combination therapies.
