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Revenues Climb at Drug Makers

Quarterly profit drops at Pfizer, but it raises its outlook. Earnings rise at Wyeth but not at Baxter.

July 21, 2006|From the Associated Press

Drug makers posted second-quarter earnings Thursday that beat analysts' expectations as sales climbed. Pfizer Inc., the world's largest drug company, even raised its outlook.

Pfizer's net income dropped 30%, but results in the year-earlier period were bolstered by one-time tax gains. It said that after adjusting for a planned asset sale, income in the most recent quarter rose 10%.

Last month, Pfizer announced that it was selling its consumer business to Johnson & Johnson in a $16.6-billion deal that is expected to close this year. Pfizer accounts for the division as a discontinued operation.

The New York-based company had forecast earnings of $2 a share in 2006. Factoring in the asset sale, that would be $1.93 a share, Pfizer said. It is sticking with the $2 forecast, essentially raising its outlook.

Net income in the second quarter fell to $2.42 billion, or 33 cents a share, from $3.46 billion, or 47 cents, a year earlier.

After adjusting for the sale of the consumer division, Pfizer earned $3.66 billion, or 50 cents a share, up from $3.32 billion, or 45 cents, a year earlier.

Analysts surveyed by Thomson Financial had estimated that, even including the consumer business, Pfizer would earn 48 cents a share.

Revenue increased 3% to $11.74 billion.

Sales of cholesterol-lowering agent Lipitor, the company's bestselling drug, rose 9% to $3.1 billion. Analysts had been concerned about its sales as health plans encouraged patients to switch to cheap, generic versions of Zocor, a competing drug made by Merck & Co. that lost patent protection last month.

Pfizer shares rose 41 cents to $23.71.

Meanwhile, Wyeth reported its net income rose to $1.06 billion, or 78 cents a share, from $976.6 million, or 72 cents. Excluding certain items, earnings in the latest quarter were $1.09 billion, or 80 cents a share. On that basis, analysts had expected Wyeth to earn 76 cents a share.

Revenue rose 9% to $5.16 billion.

Wyeth, based in Madison, N.J., said that sales of antidepressant Effexor, its bestselling drug, rose 3% to $918 million and that sales of the Prevnar vaccine, which prevents invasive pneumococcal disease in infants and young children, increased 60% to $518 million.

Wyeth shares rose 66 cents to $44.99.

Medical device and drug maker Baxter International Inc. said profit dropped 5% to $309 million, or 47 cents a share, from $324 million, or 51 cents.

Excluding special items, though, profit rose to 57 cents a share, or 5 cents more than analysts' projections. Revenue rose 3% to $2.65 billion.

The Deerfield, Ill.-based company's shares rose $1.75 to $40.33.

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