Pfizer profits jump despite loss of Lipitor patent
Chancellor George Osborne looks through a microscope at Pfizer's pharmaceutical science lab on August 17, 2011 in Sandwich, England.
Jeff Horwich: Pfizer seems to be weathering the loss of its patent for Lipitor just fine. The drug company says its second quarter profit jumped 25 percent. That's despite lower revenue, and competition from generics for its cholesterol-fighting blockbuster.
Marketplace's Amy Scott has more.
Amy Scott: Pfizer says lower research and marketing costs helped make up for lost sales of Lipitor. Those sales in the U.S. fell 79 percent as cheaper generics entered into the market.
Erik Gordon: Patent expirations aren't surprises. You can plan for them. And the way Pfizer's planned for them is by firing lots and lots of expensive employees.
Erik Gordon is a professor at the University of Michigan business school. Pfizer has laid of thousands of people in recent years, but Gordon says a company can only cut so much -- better sales of pain reliever Lyrica and the vaccine Prevnar 13 also helped.
The question is, what's next?
Gordon: The key in the pharma business is always: What's in your new drug pipeline?
Pfizer has a few promising drugs in the works. One of them -- nicknamed Tofa -- is awaiting approval from the FDA to treat rheumatoid arthritis.
A possible treatment for Alzheimer's disease -- known as Babpi -- had a setback earlier this month, when Pfizer reported disappointing results in a clinical trial. Gordon says Bapi still has blockbuster potential if it shows better results in other trials.
I'm Amy Scott for Marketplace.