Pfizer Increases 2006 Earnings Outlook

Dr. John LaMattina, President of Pfizer, speaks at the opening of their R&D Analyst meeting presentations in Groton Conn., on Thursday, Nov. 30, 2006. Pfizer Inc., the world's largest drugmaker, raises its earnings guidance for the year and promised a number of late stage products out of its pipeline in the coming years. (AP Photo/Fred Beckham) (Fred Beckham - AP)

GROTON, Conn. -- Pfizer Inc. on Thursday raised its earnings guidance for the year as it showcased its pipeline of new drugs and a new approach to dealmaking that it said should put about six new products a year on the market beginning in 2011.

CEO Jeff Kindler told analysts and investors gathered for a review of the world's largest drugmaker's plans that he understood the challenges but was determined to transform Pfizer into a nimble, innovative organization offering patients a rich selection of treatment options.

"Our ambition is to create a company that introduces a steady stream of new medicines from a more diversified product portfolio with a heavy emphasis on the therapeutic areas offering the greatest medical promise and commercial potential," Kindler said.

Patent losses will crimp Pfizer's revenues for the next two years, keeping sales at 2006 levels. And recently, there have been concerns that the star of Pfizer's pipeline, cholesterol treatment Torcetrapib, might face a problematic future because a study showed it caused an increase in blood pressure.

But as Kindler attempted to reassure analysts about Torcetrapib, he also drove the point that Pfizer was not a one-trick pony. He noted the company had 242 research programs in 11 different therapeutic areas and outlined new initiatives to increase the number of medicines it develops with other drugmakers and researchers.

Analysts said there were some promising compounds in the pipeline, including treatments for cancer and obesity. They also praised Kindler's more transparent approach in relating to the financial community, saying it contrasts sharply with that of Hank McKinnell, who vacated the post over the summer but remains chairman.

Pfizer expects to launch three new drugs next year but analysts think only one of them, an AIDS treatment, has blockbuster potential. Dr. John LaMattina, Pfizer's president of Global Research and Development, said the pipeline won't be barren until the surge of new products in 2011, noting the company will seek approval for new uses for cancer drug Sutent and Lyrica, a treatment for neuropathic pain and epilepsy and will as other compounds.

Yet, analysts remain focused on Torcetrapib, and say Pfizer will struggle if it disappoints.

"I think Torcetrapib is the key. I'm seeing a lot of drugs that might work five years from now," said Catherine Arnold, an analyst at Credit Suisse. "But most people aren't ready to buy stock on that."

Torcetrapib is a drug that raises good cholesterol, and initially it will be sold in combination with Lipitor, which lowers bad cholesterol.

Results of a trial that will use images of arteries to measure whether the drug removes plaque are due in March. The U.S. Food and Drug Administration has said it would consider approving the drug on those studies but there is a chance it may opt to wait for a trial which measures if Torcetrapib reduces the risk of heart attacks and death. Those results will not be available until 2009.

Pfizer has been hit hard recently by patent losses. A generic version of blockbuster Zoloft hit the market this summer. Next Pfizer will lose patent protection on blood pressure medicine Norvasc and allergy treatment Zyrtec.