Pfizer profits fall, still hopes to buy AstraZeneca

Pfizer Monday said it still hopes to enter merger talks with AstraZeneca as it reported lower earnings on an unexpectedly large drop in sales. Pfizer, which has been hit hard by a series of major patent expirations, cited big year-over-year drops in sales from, among others, Viagra, the sexual-dysfunction drug, and anti-cholesterol treatment Lipitor. Earnings for the first quarter fell 15.3 percent to $2.3 billion, a result that translated into 57 cents per share, two cents better than expectations. Revenues for the largest US pharmaceutical company by assets fell to $11.4 billion from $12.4 billion, well below analyst forecasts of $12.1 billion. Pfizer said it hoped its sweetened bid for AstraZeneca "will provide the basis for AstraZeneca to engage with Pfizer and enter into discussions relating to a possible combination of the two companies." AstraZeneca Friday rejected Pfizer's $106 billion takeover bid, saying the terms of the offer, increased from a previous informal bid of $99 billion, "substantially undervalue AstraZeneca and are not a basis on which to engage with Pfizer." Pfizer has said the takeover would deliver an expanded product pipeline, deep potential cost cuts and significant tax savings from making Britain its principal headquarters for tax purposes. But AstraZeneca rejected the initial informal approaches and then said no again on Friday after Pfizer raised its bid. Pfizer's pursuit of AstraZeneca comes amid a wave of deal-making in the global pharma industry. Options for Pfizer in its pursuit of AstraZeneca include raising the bid again, undertaking a hostile takeover campaign aimed at shareholders or dropping the idea. British securities regulators have given Pfizer until May 26 to make its position known. In reporting first-quarter financial results Monday, Pfizer listed clinical progress on a number of drugs in development, including palbociclib to treat mestastatic breast cancer and bococizumab, a cholesterol drug. "Despite continuing revenue challenges due to ongoing product losses of exclusivity and co-promotion expirations, I look forward to the remainder of the year given the strength of our mid- and late-stage pipeline," said chief executive Ian Read. Shares in Dow member Pfizer were down 1.1 percent at $30.40 in pre-market trade.