Pfizer Inc. (NYSE:PFE) on Tuesday reported quarterly earnings that missed analysts’ estimates and lowered the earnings outlook for the year as the company planed to end the development of a cholesterol-treatment drug.
The largest U.S. drugmaker said third-quarter profit was $1.32 billion, or 21 cents a share, compared with $2.13 billion, or 24 cents a share, a year earlier. Excluding certain items, the company earned 61 cents per share, missing analysts’ estimates of 62 cents a share. Revenue rose 7.9 percent to $13.05 billion, in-line with analysts’ estimates.
The company also cut its upper-end earnings guidance for 2016 to $2.43 from $2.48 per share, retaining the lower end at $2.38. The lower earnings expectation comes as the company announced to end the development of its cholesterol treatment bococizumab, citing that the drug had unexpected side effects and was becoming less effective over time. The company estimated that the discontinuation of the program will lower fourth-quarter earnings by 4 cents a share.
“This news was unexpected, and unusual given the late-stage of development of the product,” Tim Anderson, an analyst with Sanford C. Bernstein & Co. who rates the stock as outperform, wrote in a note to investors. Sales of Ibrance, Pfizer’s new breast cancer treatment, more than doubled to $550 million, but still missing the consensus forecast of $576 million compiled by Evercore ISI.The company’s Lyrica pain drug generated sales of $1.05 billion, missing expectation of $1.28 billion, but its Prevnar vaccine generated $1.54 billion, beating analysts’ estimates of $1.48 billion. Shares of Pfizer dropped 1.8 percent to $31.14 in the early trading.