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Wednesday, 17 April, 2002, 17:01 GMT 18:01 UK
Pfizer shares fall despite soaring profits
Pfizer logo
Shares in the world's largest drugs maker Pfizer have fallen sharply despite a 22% rise in net profits to $2.36bn (1.64bn) during the first three months of the year.

Strong sales of its cholesterol drug Lipitor and its impotency pill Viagra boosted profits.

But the good news was tempered by a warning that its costs would rise during the next three-month period.

Higher taxes and expenses on marketing and research would cause costs to balloon during spring, the company said.

Concerned investors

Pfizer shares slipped almost 5% to $38 by midday in New York due to the drug maker's prediction.

Their earnings growth in 2003 and beyond will still be above most of their peers thanks to strong drug sales

Adam Greene
Dresdner Kleinwort Wasserstein
"They met the first-quarter forecast, but it's the second-quarter guidance that bothers me," said Orbitex Management's health care funds manager, Greg Aurand.

"It sounds like they are spending a lot of money to make money."

"This slowdown is expected because they are exhausting their cost-savings from the merger [with Warner-Lambert in 2000]," said Adam Greene of Dresdner Kleinwort Wasserstein.

"But their earnings growth in 2003 and beyond will still be above most of their peers thanks to strong drug sales," he added.

Pfizer said it expects its marketing spending to pay off and its earnings to pick up during the autumn.

During the three months to March, its sales rose 11% to $8.41bn.

Lipitor sales rose 26% to $1.85bn while Viagra sales rose 12% to $422m.

See also:

10 Dec 01 | Business
Pfizer queries European drug prices
07 Feb 00 | Business
Drugs giants merge
13 Nov 01 | Business
WTO confirms drugs deal
09 Nov 01 | Health
Trade rules and cheap drugs
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