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Pfizer Beats Analyst Estimates in Second Quarter

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Pfizer products are much more than just Viagra.

There’s more to Pfizer than Viagra, and the second quarter figures appear to be evidence of that fact. The losses were great, there’s no denying it. Earnings were down 79 percent over a year ago. What’s surprising is that Pfizer performed better than anyone expected.

ABC News says Pfizer came in just slightly over the mark. Where analysts predicted an adjusted earnings at 57 cents per share, the pharmaceutical giant came in at 58 cents. That’s down from $1.98 last year.

But every penny counts, especially when you’re as large as Pfizer.

The company doesn’t appear to be disappointed, but rather encouraged by the one cent -per-share improvement over predicted earnings. In fact, the company has big plans for expansion, and is keeping its eye toward the future.

Pfizer Has a Wide Range of Drugs Besides Viagra

Many prescription medications have patent protection, but they don’t last forever. With a patent, another pharmaceutical company can’t duplicate the formula, create a copy, and sell it at a reduced price as a generic or another brand.

Pfizer’s patents on Viagra are expiring around the world. With Viagra making up such a large portion of the company’s earnings, the most logical predicted outcome was widespread losses. But that’s not entirely what happened.

Viagra isn’t the only drug that Pfizer owns; they have other drugs on the market, and many of the names might sound familiar to you.

Lyrica, for example, is a leading pain medication. Aricept is used as a treatment for Alzheimer’s patients. Pfizer  even owns the very familiar over-the-counter tooth pain drug, Anbesol.

There is no shortage of earnings potential or this pharmaceutical company. But Viagra had once been an enormous seller, and that’s slowing down. The sharp decline in earnings from one year to the next didn’t surprise anyone, but Pfizer’s other products help offset some of it.

Lyrica and Other Drugs Steady the Company’s Losses on Viagra

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Men know and trust the Viagra brand.

Of the many Pfizer drugs on the market, Lyrica can take credit for making great strides in mitigating some of the losses from slowing Viagra sales.

Laura Lorenzetti explains in her Forbes article, “Pfizer Beats Estimates as Viagra Loses Patent Protections”  that Lyrica sales have increased by 16 percent, bringing its earnings to $1.32 billion.

And that’s not the only drug doing well; Prevnar, which is a vaccine that protects against pneumonia, is up 13%, bringing its total earnings to $969 million. Lipitor is another in the stable. ABC says for more than 10 years, Lipitor was the best selling drug in the world, although it no longer holds that position.

The list of Pfizer drugs is enormous. Some of them are well known and widely used. Others aren’t, but together they are keeping Pfizer in the game.

Pfizer Has Other, Bigger Plans

Pfizer had plans to buy the UK-based pharmaceutical company, AstraZeneca. But ABC reports that the UK company turned down the buyout proposal of nearly $120 billion in May of 2014. That would have been larger than any other pharmaceutical deal in history.

Pfizer wants to branch out, and is keeping its options open. The company is considering deals that will help boost its new and experimental drug portfolio, says ABC, and those that would help reduce its tax burden.

The AstraZeneca deal would have been a boon, tax-wise. Pfizer had intended to relocate its company legal headquarters to the UK, which would have dramatically reduced its taxes.

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Men and women of all ages have benefitted from Pfizer products.

In the U.S., the corporate tax structure costs Pfizer 35 percent. This doesn’t just include profits from U.S. sales, but also sales in every other country. That’s one reason why the company has such interest in corporate tax reform in the U.S.

Staying in business means making smart financial moves. Although shifting headquarters to another country might not be a popular decision with everyone, American corporations, especially those with global sales, feel the tax sting.

Lorenzetti says Pfizer and AstraZeneca aren’t closing off communications about a deal. The UK company could reopen talks about a deal any time it likes. But for Pfizer to initiate the conversation, it has to wait until November, when Lorenzetti says the UK mandatory waiting period is over.

Losing the Viagra patent did hurt Pfizer’s earnings. Sales outside the U.S. dropped nearly 30 percent, and the company’s other drugs haven’t managed to make up the difference.

But Ian Read, Pfizer’s CEO, told Fortune that he’s happy with the company’s operating performance. He went on to say, “Our recently launched products continued to gain traction during the quarter while our mid- and late-stage pipeline continued to progress.”

The AstraZeneca deal might be dead in the water, or it might only be on pause. But either way, Pfizer has lofty goals. It wants to become the largest pharmaceutical company in the world. Keeping its options open means anything could happen in the future.

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