Drugmaker Pfizer's fourth-quarter profit plunged 59 per cent because of discontinued operations, restructuring and other charges, and generic competition continuing to bleed sales of former blockbuster medicines.
Despite those pressures and unfavourable currency exchange rates reducing revenue by 3 per cent, Pfizer easily topped Wall Street's expectations.
New York-based Pfizer's stock rose 85 cents, or 2.9 per cent, to $30.51 in afternoon trading.
The world's second-biggest drugmaker said Tuesday that net income fell to $2.57 billion, or 39 cents per share, from $6.32 billion, or 85 cents per share, a year earlier.
Excluding one-time items, Pfizer said income would have been 56 cents per share. Analysts expected 52 cents.
Net income was reduced by the animal health business spinoff last year and the sale of Pfizer's nutrition business in late 2012.
Revenue totalled $13.56 billion, down 2 per cent. Analysts expected $13.36 billion.
Sales of primary care drugs fell 10 per cent to $3.44 billion, mainly on generic competition for Viagra in Europe and for cholesterol fighter Lipitor.
Lipitor, the world's top-selling drug until U.S. generic competition hit two years ago, now faces cheaper copycats in Europe and Australia, too. Those smaller revenues were shifted to the established products unit, where sales edged up 2 per cent to $2.42 billion.
Specialty drug sales dropped 7 per cent to $3.4 billion, on generic competition overseas for two other drugs. Meanwhile, royalties from immune disorder drug Enbrel fell as Pfizer's co-promotion deal winds down.
The bright spot was Pfizer's fledgling cancer drug business, up 26 per cent to $468 million.
But Pfizer's new clot-preventing drug Eliquis, a potential blockbuster that's lagged behind two competitors, brought in only $71 million in the quarter. Pfizer shares that with partner Bristol-Myers Squibb Co.
Pfizer forecast 2014 adjusted profit of $2.20 to $2.30 per share and revenue of about $50.2 billion, despite expecting another $3 billion in revenue losses due to generic competition.
"We start 2014 with a sound strategy and a strong business," CEO Ian Read told analysts on a conference call.
He noted Pfizer will report midstage test results this year for palbociclib for advanced breast cancer, plus some other drugs and vaccines. Analysts are closely watching heavily touted palbociclib, which also is being tested against melanoma, lung and other cancer types.
BernsteinResearch analyst Dr. Timothy Anderson called it a "decent" quarter, noting slightly higher revenue and lower taxes than expected and lower interest, legal and asset-impairment charges. But Pfizer faces more patent expirations on older drugs.
For all of 2013, Pfizer posted net income of $22 billion, up 51 per cent, on revenue of $51.58 billion, down 6 per cent. Pfizer repurchased 1 billion, or 13 per cent, of its shares last year.
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