Lipitor swoons, taking Pfizer's pharma sales down 25%

King Lipitor is dead. Long live ... what? That's the obvious question investors are asking today as Pfizer ($PFE) posted street-beating earnings on the back of cost cuts. Lipitor sales tanked 42%, not unexpectedly; the megablockbuster cholesterol drug went off patent Nov. 30. And though sales of other products grew--as did revenues from emerging markets like China--overall pharma sales dropped 25%.

Drugs that grew include Lyrica, whose sales rose 16% to $955 million; Celebrex, which gained 7% to $634 million; and Enbrel, which saw 3% growth to $899 million. Those incremental sales are just drops in the bucket compared with Lipitor's $1 billion drop, though--to $1.4 billion from $2.4 billion.

To its credit, Pfizer has managed to hang onto more post-patent market share than most drugmakers do. But another assault on Lipitor sales will come in June, after Ranbaxy Laboratories' exclusivity expires, letting other Lipitor rivals onto the market.

The decline in drug sales comes as Pfizer is hiving off two units to focus its efforts on the pharma business. The company announced last month that it would sell its nutrition unit to Nestlé for $11.9 billion. Meanwhile, it's preparing to divest its animal health unit, probably via a combination IPO and share swap, CEO Ian Read said.

In announcing the unit-sales plans, Read referred to the pharma business as its "innovative core," and it's that core that needs to deliver now. "The real news will be the updates on the product pipeline for the company that will be left after the nutrition and animal health units are gone," University of Michigan business professor Erik Gordon told Bloomberg.

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