Pfizer earnings plunge 38%

Drugmaker Pfizer’s third-quarter profit plunged 38 percent as higher spending and a slew of acquisition-related charges more than offset higher sales, sending its shares down before the stock market opened.
The mediocre results missed Wall Street expectations. Pfizer lowered the top end of its 2016 profit forecast and it said it was scrapping development of a closely watched experimental cholesterol drug, partly due to reduced sales expectations.
Coming after Pfizer Inc.’s Sept. 26 announcement that it won’t split into two companies to accelerate growth — a move some investors and analysts had hoped would boost Pfizer’s lagging stock — disappointed investors.
“Some investors feel the company has careened from strategy to strategy over the past few years,” said Erik Gordon, a professor and pharmaceuticals analyst at University of Michigan’s Ross School of Business.
He said that included failed attempts at two mega-acquisitions — first of Britain’s AstraZeneca Plc in 2014 and this year of Ireland’s Allergan Plc — meant to slash Pfizer’s taxes, plus deals including this year’s purchase of cancer drugmaker Medivation and then abandoning its long-expected split into two companies.
Pfizer “has built shareholder value more on its wheeling and dealing” than on developing new medicines, Gordon added.

Source: Arab News