Pfizer's profit misses as Prevnar sales lag, costs rise

REUTERS - Pfizer Inc, which closed its $14 billion acquisition of Medivation Inc in September, reported a lower-than-expected profit, hit by lower demand for its flagship flu vaccine Prevnar and higher expenses.

Shares of Pfizer, which has relied heavily on Prevnar for growth to offset the continued generic erosion of its legacy brands, were down 1.1 percent at $30.98 in premarket trading on Tuesday.

Global Prevnar sales fell 23 percent to $1.42 billion, below estimates of $1.62 billion, according to Evercore ISI, and the company attributed the persistent fall in sales growth to a successful initial capture of the eligible population following the product's 2014 launch.

Pfizer, the largest U.S. drugmaker, earned an adjusted profit of 47 cents per share, missing the average analysts' estimate of 50 cents, according to Thomson Reuters I/B/E/S.

Prevnar was quite light this quarter, as were sales of Sutent and Inlyta, while SG&A was well above expectations and a key contributor to the EPS miss, Credit Suisse analysts said.

The company's revenue slipped 3 percent to $13.63 billion, due to a strong dollar and fewer selling days compared to the year-ago quarter, but was roughly in line with estimates.

Those lost days resulted in a negative impact on quarterly revenue by about $750 million compared to the prior-year quarter, Pfizer said.

The company, which decided against splitting itself to separate its eroding legacy business from its array of patent-protected medicines in September, has taken a number of steps to streamline operations.

Pfizer agreed to sell its global infusion therapy business, which it acquired through its $15 billion purchase of Hospira in 2015 to ICU Medical Inc for $1 billion, the following month.

Reuters in November reported the company was evaluating a potential sale or spin-off of its consumer health division that could value the unit at as much as $14 billion, citing sources.

Pfizer on Tuesday forecast adjusted profit of $2.50-$2.60 per share on revenue of $52 billion-$54 billion for 2017. Analysts on average were expecting earnings of $2.56 per share and revenue of $54.03 billion.

(Reporting by Natalie Grover in Bengaluru; Editing by Shounak Dasgupta)