Pfizer raises 2019 forecast as sales of cancer drug, heart medicine surge
(Reuters) – Pfizer Inc (PFE.N) reported a higher-than-expected third-quarter profit on Tuesday on increased sales of cancer drug Ibrance and a strong launch of new heart medicine Vyndaqel, prompting the largest U.S. drugmaker to lift its earnings forecast for the year.
Pfizer raised its 2019 adjusted earnings forecast to $2.94 to $3.00 per share from its prior estimate of $2.76 to $2.86, and its shares rose 3.6%. Analysts on average were expecting $2.82, according to Refinitiv IBES.
Pfizer Chief Executive Albert Bourla, on a conference call, also raised the 2019 revenue growth forecast for the company’s Upjohn unit in China to “mid-to-high single digits” from an earlier view of low-to-mid single digits, even as it prepares to spin off that business.
The New York-based drugmaker announced in July it would separate the Upjohn unit, which sells off-patent branded drugs, and combine it with generic drugmaker Mylan NV (MYL.O), allowing Pfizer to focus on its more profitable newer medicines.
Mylan will be able to leverage a strong base in Asia through Upjohn, whose headquarters Pfizer had shifted to China, a prime market for the older branded drugs with high name recognition such as Lipitor. Mylan shares rose 2.8% to $19.51.
Bourla said he envisions Pfizer as a “smaller, science-based company” following close of the Mylan deal, expected next year.
While sales of breast cancer drug Ibrance rose 25% to $1.28 billion rheumatoid arthritis drug Xeljanz had a sales jump of nearly 39% to $599 million, the performance of Vyndaqel out of the gate was an eye opener.
The drug, chemically known as tafamidis which was approved in May, brought in sales of $156 million, nearly double the Wall Street estimate of $82 million.
“Ibrance is back to strong growth after a period of slowing,” said UBS analyst Navin Jacob, adding that “the Vyndaqel number in particular is impressive.”
Priced at $225,000 per year, Vyndaqel’s high cost has faced criticism. Experts affiliated with Boston-based Institute for Clinical and Economic Review (ICER) said it could become among the most costly cardiovascular treatments ever.
Investor sentiment on Pfizer has been poor since it announced the deal with Mylan, making the third-quarter beat a relief, Jacob said.
Excluding special items, Pfizer earned 75 cents per share, topping analysts’ average estimate by 13 cents.
Total revenue fell about 5% to $12.68 billion as sales of pain treatment Lyrica, which now faces generic competition in the United States, fell by more than half to $527 million.
Reporting by Tamara Mathias and Aakash Jagadeesh Babu in Bengaluru and Michael Erman in New York; Editing by Anil D’Silva and Bill Berkrot