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)

"We understand the challenges (caused by the patent expirations) and the urgency of addressing it," said David Shedlarz, Pfizer's vice chairman.

Shedlarz will oversee efforts to work with other companies and academics to find new products and technologies that he maintains will allow Pfizer to bring two new products per year to the market by 2010. Pfizer's own pipeline should contribute four new drugs annually by then, the company said.

Pfizer has always collaborated with others but Shedlarz said the effort is becoming more streamlined and creative. For example, departments conducting business development, mergers and acquisitions and licensing agreements will all be brought together in one division.

He also said that Pfizer would be more flexible in structuring deals with both companies and academics so it can work with people who may not find the corporate atmosphere conducive to scientific research.

Shedlarz didn't rule out a major acquisition but said that if would not buy another company for short-term financial gain and would only make a purchase if it made strategic sense.

Pfizer also announced a research collaboration with the Scripps Research Institute and said it was launching a project at its facility in La Jolla, Calif., to discover new biotech drugs.

The drug pipeline summary followed Pfizer's announcement last month that it was exploring ways to cut its costs beyond the $4 billion it had already pledged to slash by 2008. Pfizer announced earlier this week that it would cut 20 percent, or 2,200 people, from its U.S. sales force of 11,000. Analysts estimated that could cut between $400 million and $500 million from annual costs.

Meanwhile, Pfizer raised its adjusted earnings-per-share forecast to a minimum of $2.05, from an earlier forecast of $2. Without adjustments, the company expects earnings at least $1.68 per share.

Analysts surveyed by Thomson Financial had been expecting adjusted earnings per share of $2.02.

Pfizer stuck to targeting average earnings growth in the high single-digit percentage range in 2007 and 2008.

Pfizer shares rose 42 cents, or 1.6 percent, to close at $27.49 on the New York Stock Exchange.

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AP Business Writer Wallace Witkowski in New York contributed to this story.