PFIZER PREDICTS STAGNATING REVENUE, PLANS TO CUT COSTS

Pfizer will seek to cut operating costs amid lower revenue projections for 2007 and 2008, the pharmaceutical giant said in its third quarter financial report.

CEO Jeffrey Kindler said Pfizer faces a number of near-term challenges, including: the loss of exclusivity on several major products; strong competition for many of its key products from generics and other sources; regulatory and pricing challenges; a recent strengthening of the U.S. dollar; and "actions on access and pricing taken by influential decisionmakers in several large European markets."

"As a result, at current exchange rates we are now expecting revenues in 2007 and 2008 to be comparable to 2006, as compared to our previous forecast of modest revenue growth over the period," Kindler said. Pfizer will begin a "companywide cost-reduction initiative" next year to keep operating expenses for 2007 and 2008 below those of 2006. These reductions will be in addition to the company's previously planned Adapting to Scale initiative.

In the third quarter of 2006, Pfizer reported net income of $3.36 billion on revenue of $12.28 billion, compared with $1.59 billion of net income on revenue of $11.26 billion in the third quarter of 2005, a 9 percent increase in revenue and a 109 percent increase in diluted earnings per share.