Pfizer Shares Fall 11% on Failure Of Cholesterol Drug
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
WASHINGTON — Pfizer Inc.’s shares fell 11%, wiping out $21 billion of market value, after the world’s biggest drugmaker ended development of its most important new treatment, a cholesterol medicine designed to replace Lipitor when its patent expires.
Pfizer ended studies of the cholesterol pill torcetrapib December 2 because deaths among patients taking it were 60% higher than in a group who didn’t get the drug. The stock plunged $2.96 to $24.90 at the close of New York Stock Exchange composite trading. The shares earlier touched $23.50.
The loss of torcetrapib thrust Chief Executive Officer Jeffrey Kindler, a 51-year-old former McDonald’s Corp. executive who took the Pfizer helm in July, into one of the biggest financial crises in the New York-based company’s 157-year history. Pfizer invested $1 billion in developing the medicine and needed it to replace Lipitor, the source of a quarter of its $51 billion in annual revenue and almost half of net income.
“The bet-the-ranch-on-one-drug approach was in place before Kindler got there, so now he has a chance to change course,” an analyst with Miller Tabak & Co. in New York, Les Funtleyder, said in a telephone interview. “This announcement offers him political cover to make really radical changes.”
