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Pfizer Reports Third-Quarter 2012 Results

“With regard to our innovative core, I am very pleased with the recent U.S. Food and Drug Administration approval of Bosulif (bosutinib) for chronic myelogenous leukemia, as well as approval of Inlyta (axitinib) for advanced renal cell carcinoma and conditional marketing authorization of Xalkori (critzotinib) for advanced non-small cell lung cancer, both in the EU. I also look forward to regulatory action for tofacitinib in moderate-to-severe rheumatoid arthritis and Eliquis (apixaban) in atrial fibrillation in the U.S., EU and Japan as well as Bosulif in key international markets.”

“Additionally, we filed a registration statement with the Securities and Exchange Commission for the potential initial public offering of a minority stake in our Animal Health business, Zoetis. Given our demonstrated ability to advance our strategic initiatives, I believe we are well-positioned to deliver attractive returns for our shareholders over time,” Mr. Read concluded.

Frank D’Amelio, Chief Financial Officer, stated, “Given our financial performance to date, we are narrowing the ranges for certain components of our 2012 financial guidance. Further, the Board of Directors has authorized a new $10 billion share repurchase program to be utilized over time, upon the sale of the Nutrition (1) business to Nestlé, which we now expect to close in the next few months. This new program is in addition to the $4.1 billion authorization remaining under our current share repurchase program. So far this year, we have repurchased approximately $5.9 billion, or 255.1 million shares, of our common stock.”

2012 Financial Guidance (7)

Pfizer’s financial guidance, at current exchange rates (8), is summarized below. Since the Nutrition (1) business is presented as a discontinued operation, the full-year results of that business only impact the Reported Diluted EPS (3) and operating cash flow components of our 2012 financial guidance.

         
Reported Revenues       $58.0 to $59.0 billion

(previously $58.0 to $60.0 billion)

Adjusted Cost of Sales (2) as a Percentage of Revenues       18.7% to 19.2%

(previously 19.5% to 20.5%)

Adjusted SI&A Expenses (2)       $16.3 to $16.8 billion

(previously $16.3 to $17.3 billion)

Adjusted R&D Expenses (2)       $7.0 to $7.25 billion

(previously $6.75 to $7.25 billion)

Adjusted Other (Income)/Deductions (2)       Approximately $900 million

(previously approximately $1.0 billion)

Effective Tax Rate on Adjusted Income (2)       Approximately 29%
Reported Diluted EPS (3)       $1.30 to $1.38

(previously $1.21 to $1.36)

Adjusted Diluted EPS (2)       $2.14 to $2.17

(previously $2.12 to $2.22)

Operating Cash Flow       Approximately $18.5 billion

(previously approximately $19.0 billion)

     

For additional details, please see the attached financial schedules, product revenue tables, supplemental information and disclosure notice.

(1)      

On April 23, 2012, Pfizer announced that it entered into an agreement to sell the Nutrition business to Nestlé. The transaction is expected to close in the next few months, assuming the receipt of the required regulatory clearances and the satisfaction of other closing conditions. As a result of Pfizer’s decision to divest this business, the operating results of the Nutrition business are reported as Discontinued Operations – net of tax in the consolidated statements of income for all periods.

 
(2)

"Adjusted Income" and its components and "Adjusted Diluted Earnings Per Share (EPS)" are defined as reported U.S. generally accepted accounting principles (GAAP) net income (3) and its components and reported diluted EPS (3) excluding purchase accounting adjustments, acquisition-related costs, discontinued operations and certain significant items. Adjusted Cost of Sales, Adjusted Selling, Informational and Administrative (SI&A) expenses, Adjusted Research and Development (R&D) expenses and Adjusted Other (Income)/Deductions are income statement line items prepared on the same basis, and, therefore, components of the overall adjusted income measure. As described under Adjusted Income in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of Pfizer's Form 10-Q for the fiscal quarter ended July 1, 2012, management uses adjusted income, among other factors, to set performance goals and to measure the performance of the overall company. We believe that investors' understanding of our performance is enhanced by disclosing this measure. Reconciliations of certain GAAP reported to non-GAAP adjusted information for the third quarter and first nine months of 2012 and 2011, as well as reconciliations of full-year 2012 guidance for adjusted income and adjusted diluted EPS to full-year 2012 guidance for reported net income (3) and reported diluted EPS (3), are provided in the materials accompanying this report. The adjusted income and its components and adjusted diluted EPS measures are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS.

 
(3) “Reported Net Income” is defined as net income attributable to Pfizer Inc. in accordance with U.S. GAAP. “Reported Diluted EPS” is defined as reported diluted EPS attributable to Pfizer Inc. common shareholders in accordance with U.S. GAAP.
 
(4)

On August 1, 2011, Pfizer completed the sale of Capsugel to an affiliate of Kohlberg Kravis Roberts & Co. L.P.  The operating results associated with Capsugel and the gain on the sale of Capsugel are reported as Discontinued operations – net of tax in the consolidated statements of income for the three and nine months ended October 2, 2011.  Additionally, due to the acquisition of King Pharmaceuticals, Inc. (King), legacy King operations are reflected in the results beginning January 31, 2011.  Therefore, in accordance with Pfizer’s domestic and international reporting periods, the operating results for the first nine months of 2011 reflect approximately eight months of King’s U.S. operations and approximately seven months of King’s international operations.

 
(5) For a description of each business unit, see Note 13A to Pfizer’s condensed consolidated financial statements included in Pfizer’s Form 10-Q for the fiscal quarter ended July 1, 2012.
 
(6) Other includes revenues generated primarily from Pfizer CentreSource, Pfizer’s contract manufacturing and bulk pharmaceutical chemical sales organization.
 
(7)

The 2012 financial guidance includes the revenues and expenses related to the Nutrition business, which is reflected as a discontinued operation, but does not include the gain on the pending sale of the Nutrition business. Does not assume the completion of any business-development transactions not completed as of September 30, 2012, including any one-time upfront payments associated with such transactions. Also excludes the potential effects of the resolution of litigation-related matters not substantially resolved as of September 30, 2012, except for charges for such matters that have been recorded during the first nine months of 2012.

 
(8) The current exchange rates assumed in connection with the 2012 financial guidance are a blend of the actual exchange rates in effect during the first nine months of 2012 and the mid-October 2012 exchange rates for the remainder of the year.
 
PFIZER INC. AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME (a)
(UNAUDITED)
(millions, except per common share data)
           
Third Quarter % Incr. / Nine Months % Incr. /
2012 2011 (Decr.) 2012 2011 (Decr.)
Revenues $ 13,976 $ 16,609 (16) $ 43,918 $ 49,118 (11)
Costs and expenses:
Cost of sales (b) 2,665 3,409 (22) 8,162 10,449 (22)

Selling, informational and administrative expenses (b)

3,847 4,457 (14) 11,801 13,635 (13)
Research and development expenses (b) 1,981 2,176 (9) 5,734 6,487 (12)
Amortization of intangible assets (c) 1,228 1,389 (12) 3,939 4,138 (5)
Restructuring charges and certain acquisition-related costs 302 1,090 (72) 1,089 2,458 (56)
Other deductions--net   962     547 76   3,283   1,802 82

Income from continuing operations before provision/(benefit) for taxes on income

2,991 3,541 (16) 9,910 10,149 (2)
Provision/(benefit) for taxes on income   (119 )   1,216 (110)   1,882   3,167 (41)
Income from continuing operations   3,110     2,325 34   8,028   6,982 15
Discontinued operations:
Income from discontinued operations--net of tax 104 96 8 249 303 (18)
Gain on sale of discontinued operations--net of tax   -     1,328 (100)   -   1,316 (100)
Discontinued operations--net of tax   104     1,424 (93)   249   1,619 (85)
Net income before allocation to noncontrolling interests 3,214 3,749 (14) 8,277 8,601 (4)
Less: Net income attributable to noncontrolling interests   6     11 (45)   22   31 (29)
Net income attributable to Pfizer Inc. $ 3,208   $ 3,738 (14) $ 8,255 $ 8,570 (4)

Earnings per common share--basic: (d)

Income from continuing operations attributable to Pfizer Inc. common shareholders

$ 0.42 $ 0.30 40 $ 1.07 $ 0.88 22
Discontinued operations--net of tax   0.01     0.18 (94)   0.03   0.21 (86)
Net income attributable to Pfizer Inc. common shareholders $ 0.43   $ 0.48 (10) $ 1.10 $ 1.09 1

Earnings per common share--diluted: (d)

Income from continuing operations attributable to Pfizer Inc. common shareholders

$ 0.41 $ 0.30 37 $ 1.06 $ 0.88 20
Discontinued operations--net of tax   0.01     0.18 (94)   0.03   0.20 (85)
Net income attributable to Pfizer Inc. common shareholders $ 0.43   $ 0.48 (10) $ 1.09 $ 1.08 1
Weighted-average shares used to calculate earnings per common share:
Basic   7,436     7,770   7,483   7,877
Diluted   7,508     7,810   7,550   7,925
 
(a)  

The above financial statements present the three and nine months ended September 30, 2012 and October 2, 2011. Subsidiaries operating outside the United States are included for the three and nine months ended August 26, 2012 and August 28, 2011.

 

Beginning in the second quarter of 2012, as a result of our decision to sell the Nutrition business, we report the operating results of the Nutrition business as Discontinued operations: Income from discontinued operations--net of tax for all periods presented.

 

On August 1, 2011, we completed the sale of our Capsugel business and recognized a gain on the sale in Discontinued operations: Gain on sale of discontinued operations--net of tax for the three and nine months ended October 2, 2011. The operating results of this business are reported as Discontinued operations: Income from discontinued operations--net of tax for the three and nine months ended October 2, 2011.

 

On January 31, 2011, we completed a tender offer for the outstanding shares of common stock of King Pharmaceuticals, Inc. (King) and, commencing from that date, our financial statements include the assets, liabilities, operating results and cash flows of King. As a result, and in accordance with our domestic and international reporting periods, our operating results for the nine months ended October 2, 2011 reflect approximately eight months of King’s U.S. operations and approximately seven months of King’s international operations.

 
Certain amounts and percentages may reflect rounding adjustments.
 
See Supplemental Information that accompanies these materials for additional details.
 

The financial results for the three and nine months ended September 30, 2012 are not necessarily indicative of the results which could ultimately be achieved for the full year.

 
(b) Exclusive of amortization of intangible assets, except as discussed in footnote (c) below.

 

(c)

Amortization expense related to acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets as these intangible assets benefit multiple business functions. Amortization expense related to acquired intangible assets that are associated with a single function is included in Cost of sales, Selling, informational and administrative expenses or Research and development expenses, as appropriate.

 
(d) EPS amounts may not add due to rounding.
 
 
PFIZER INC. AND SUBSIDIARY COMPANIES
RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS
(UNAUDITED)
(millions of dollars, except per common share data)
 
 

Quarter Ended September 30, 2012

 

PurchaseAccountingAdjustments

Acquisition-RelatedCosts (2)

CertainSignificantItems (3)

Non-GAAPAdjusted (a)

GAAP Reported (1)

DiscontinuedOperations

Revenues $ 13,976   $ - $ -   $ -   $ -   $

13,976

Cost of sales (b) 2,665 2 (78 ) - (24 ) 2,565

Selling, informational and administrative expenses (b)

3,847 (2 ) (3 ) - (113 ) 3,729

Research and development expenses (b)

1,981 1 - - (47 ) 1,935
Amortization of intangible assets (c) 1,228 (1,186 ) - - - 42
Restructuring charges and certain acquisition-related costs 302 - (149 ) - (153 ) -
Other deductions--net 962 45 - - (821 ) 186

Income from continuing operations before provision/(benefit) for taxes on income

2,991 1,140 230 - 1,158 5,519
Provision/(benefit) for taxes on income (119 ) 327 40 - 1,316 1,564
Income from continuing operations 3,110 813 190 - (158 ) 3,955
Discontinued operations--net of tax 104 - - (104 ) - -
Net income attributable to noncontrolling interests 6 - - - - 6
Net income attributable to Pfizer Inc. 3,208 813 190 (104 ) (158 ) 3,949

Earnings per common share attributable to Pfizer Inc.--diluted (d)

0.43 0.11 0.03 (0.01 ) (0.02 ) 0.53
 
 

 

 
Nine Months Ended September 30, 2012

Purchase

Acquisition-

Certain

GAAP

Accounting

Related

Discontinued

Significant

Non-GAAP

Reported (1)

Adjustments

Costs (2)

Operations

Items (3)

 

Adjusted (a)

Revenues $ 43,918 $ - $ - $ - $ - $ 43,918
Cost of sales (b) 8,162 (9 ) (214 ) - (51 ) 7,888

Selling, informational and administrative expenses (b)

11,801 4 (8 ) - (174 ) 11,623
Research and development expenses (b) 5,734 3 (5 ) - (386 ) 5,346
Amortization of intangible assets (c) 3,939 (3,763 ) - - - 176
Restructuring charges and certain acquisition-related costs 1,089 - (423 ) - (666 ) -
Other deductions--net 3,283 15 - - (2,644 ) 654

Income from continuing operations before provision/(benefit) for taxes on income

9,910 3,750 650 - 3,921 18,231
Provision/(benefit) for taxes on income 1,882 1,025 161 - 2,177 5,245
Income from continuing operations 8,028 2,725 489 - 1,744 12,986
Discontinued operations--net of tax 249 - - (249 ) - -
Net income attributable to noncontrolling interests 22 - - - - 22
Net income attributable to Pfizer Inc. 8,255 2,725 489 (249 ) 1,744 12,964
Earnings per common share attributable to Pfizer Inc.--diluted (d) 1.09 0.36 0.06 (0.03 ) 0.23 1.72
 
(a)   Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS. Despite the importance of these measures to management in goal setting and performance measurement, we stress that Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are Non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS (unlike U.S. GAAP net income and its components and diluted EPS) may not be comparable to the calculation of similar measures of other companies. Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are presented solely to permit investors to more fully understand how management assesses performance.
 
(b) Exclusive of amortization of intangible assets, except as discussed in footnote (c) below.
 
(c)

Amortization expense related to acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets as these intangible assets benefit multiple business functions. Amortization expense related to acquired intangible assets that are associated with a single function is included in Cost of sales, Selling, informational and administrative expenses or Research and development expenses, as appropriate.

 
(d) EPS amounts may not add due to rounding.
 
See end of tables for notes (1), (2) and (3).
 
Certain amounts may reflect rounding adjustments.
 
 
PFIZER INC. AND SUBSIDIARY COMPANIES
RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS
(UNAUDITED)
(millions of dollars, except per common share data)
 
  Quarter Ended October 2, 2011
  Purchase   Acquisition-     Certain  
GAAP Accounting Related Discontinued Significant Non-GAAP
Reported (1) Adjustments Costs (2) Operations Items (3) Adjusted (a)
Revenues $ 16,609 $ - $ - $ - $ - $ 16,609
Cost of sales (b) 3,409 (286 ) (68 ) - 2 3,057

Selling, informational and administrative expenses (b)

4,457 (9 ) (18 ) - (33 ) 4,397
Research and development expenses (b) 2,176 3 (6 ) - (150 ) 2,023
Amortization of intangible assets (c) 1,389 (1,352 ) - - - 37
Restructuring charges and certain acquisition-related costs 1,090 - (202 ) - (888 ) -
Other deductions--net 547 (53 ) - - (240 ) 254

Income from continuing operations before provision/(benefit) for taxes on income

3,541 1,697 294 - 1,309 6,841
Provision/(benefit) for taxes on income 1,216 445 54 - 419 2,134
Income from continuing operations 2,325 1,252 240 - 890 4,707
Discontinued operations--net of tax (d) 1,424 - - (1,424 ) - -

Net income attributable to noncontrolling interests

11 - - - - 11
Net income attributable to Pfizer Inc. 3,738 1,252 240 (1,424 ) 890 4,696
Earnings per common share attributable to Pfizer Inc.--diluted (e) 0.48 0.16 0.03 (0.18 ) 0.11 0.60
 
 
 
 
Nine Months Ended October 2, 2011

PurchaseAccountingAdjustments

Acquisition-RelatedCosts (2)

CertainSignificantItems (3)

GAAP Reported (1)

DiscontinuedOperations

Non-GAAPAdjusted (a)

Revenues $ 49,118 $ - $ - $ - $ - $ 49,118
Cost of sales (b) 10,449 (1,081 ) (410 ) - (7 ) 8,951

Selling, informational and administrative expenses (b)

13,635 (6 ) (41 ) - (39 ) 13,549
Research and development expenses (b) 6,487 - (9 ) - (398 ) 6,080
Amortization of intangible assets (c) 4,138 (4,039 ) - - - 99
Restructuring charges and certain acquisition-related costs 2,458 - (996 ) - (1,462 ) -
Other deductions--net 1,802 (71 ) - - (1,269 ) 462

Income from continuing operations before provision/(benefit) for taxes on income

10,149 5,197 1,456 - 3,175 19,977
Provision/(benefit) for taxes on income 3,167 1,345 320 - 1,059 5,891
Income from continuing operations 6,982 3,852 1,136 - 2,116 14,086
Discontinued operations--net of tax (d) 1,619 - - (1,619 ) - -
Net income attributable to noncontrolling interests 31 - - - - 31
Net income attributable to Pfizer Inc. 8,570 3,852 1,136 (1,619 ) 2,116 14,055
Earnings per common share attributable to Pfizer Inc.--diluted (e) 1.08 0.49 0.14 (0.20 ) 0.27 1.77
 
(a)  

Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS. Despite the importance of these measures to management in goal setting and performance measurement, we stress that Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are Non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS (unlike U.S. GAAP net income and its components and diluted EPS) may not be comparable to the calculation of similar measures of other companies. Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are presented solely to permit investors to more fully understand how management assesses performance.

 
(b) Exclusive of amortization of intangible assets, except as discussed in footnote (c) below.
 
(c)

Amortization expense related to acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets as these intangible assets benefit multiple business functions. Amortization expense related to acquired intangible assets that are associated with a single function is included in Cost of sales, Selling, informational and administrative expenses or Research and development expenses, as appropriate.

 

 

(d) On August 1, 2011, we completed the sale of our Capsugel business. The gain recognized related to the sale of this business, as well as the operating results of this business, are included in GAAP Reported Discontinued operations—net of tax.
 
(e) EPS amounts may not add due to rounding.
 
See end of tables for notes (1), (2) and (3).
 
Certain amounts may reflect rounding adjustments.
 
 
PFIZER INC. AND SUBSIDIARY COMPANIES
NOTES TO RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS*
(UNAUDITED)
 
1)

The financial statements present the three and nine months ended September 30, 2012 and October 2, 2011. Subsidiaries operating outside the United States are included for the three and nine months ended August 26, 2012 and August 28, 2011.

 

Beginning in the second quarter of 2012, as a result of our decision to sell the Nutrition business, we report the operating results of the Nutrition business as Discontinued operations: Income from discontinued operations--net of tax for all periods presented.

 

On August 1, 2011, we completed the sale of our Capsugel business and recognized a gain on the sale in Discontinued operations: Gain on sale of discontinued operations--net of tax for the three and nine months ended October 2, 2011. The operating results of this business are reported as Discontinued operations: Income from discontinued operations--net of tax for the three and nine months ended October 2, 2011.

 

On January 31, 2011, we completed a tender offer for the outstanding shares of common stock of King Pharmaceuticals, Inc. (King) and, commencing from that date, our financial statements include the assets, liabilities, operating results and cash flows of King. As a result, and in accordance with our domestic and international reporting periods, our operating results for the nine months ended October 2, 2011 reflect approximately eight months of King’s U.S. operations and approximately seven months of King’s international operations.

 
2) Acquisition-related costs include the following:
      Third Quarter   Nine Months
(millions of dollars)   2012   2011 2012   2011
 
Transaction costs (a) $ - $ 5 $ 1 $ 28
Integration costs (a) 87 184 295 562
Restructuring charges (a) 62 13 127 406

Additional depreciation--asset restructuring (b)

  81     92     227     460  

Total acquisition-related costs--pre-tax

230 294 650 1,456
Income taxes (c)   (40 )   (54 )   (161 )   (320 )

Total acquisition-related costs--net of tax

$ 190   $ 240   $ 489   $ 1,136  
 
  (a)  

Transaction costs represent external costs directly related to acquired businesses and primarily include expenditures for banking, legal, accounting and other similar services. Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes. Restructuring charges include employee termination costs, asset impairments and other exit costs associated with business combinations. The sum of these costs and charges is included in Restructuring charges and certain acquisition-related costs.

 
(b)

Represents the impact of changes in the estimated useful lives of assets involved in restructuring actions related to acquisitions. Included in Cost of sales ($78 million) and Selling, informational and administrative expenses ($3 million) for the three months ended September 30, 2012. Included in Cost of sales ($214 million), Selling, informational and administrative expenses ($8 million) and Research and development expenses ($5 million) for the nine months ended September 30, 2012. Included in Cost of sales ($68 million), Selling, informational and administrative expenses ($18 million) and Research and development expenses ($6 million) for the three months ended October 2, 2011. Included in Cost of sales ($410 million) , Selling, informational and administrative expenses ($41 million) and Research and development expenses ($9 million) for the nine months ended October 2, 2011.

 
(c) Included in Provision/(benefit) for taxes on income.
         
3 ) Certain significant items include the following:
  Third Quarter Nine Months
(millions of dollars)   2012 2011 2012 2011
 
Restructuring charges (a) $ 153 $ 888 $ 666 $ 1,462

Implementation costs and additional depreciation--asset restructuring (b)

111 183 486 437
Certain legal matters (c) 725 132 1,983 657
Certain asset impairment charges (d) 54 106 543 595
Costs associated with the potential separation of the Animal Health business (e) 100 8 191 8
Other   15     (8 )   52     16  

Total certain significant items--pre-tax

1,158 1,309 3,921 3,175
Income taxes (f)   (1,316 )   (419 )   (2,177 )   (1,059 )

Total certain significant items--net of tax

$ (158 ) $ 890   $ 1,744   $ 2,116  
 
  (a)   Included in Restructuring charges and certain acquisition-related costs, primarily related to our cost-reduction and productivity initiatives.
 
(b)

Primarily related to our cost-reduction and productivity initiatives. Included in Cost of Sales ($19 million), Selling, informational and administrative expenses ($45 million) and Research and development expenses ($47 million) for the three months ended September 30, 2012. Included in Cost of Sales ($23 million), Selling, informational and administrative expenses ($77 million) and Research and development expenses ($386 million) for the nine months ended September 30, 2012. Included in Selling, informational and administrative expenses ($33 million) and Research and development expenses ($150 million) for the three months ended October 2, 2011. Included in Selling, informational and administrative expenses ($39 million) and Research and development expenses ($398 million) for the nine months ended October 2, 2011.

 
(c)

Included in Other deductions--net. In the third quarter of 2012, primarily includes a $491 million charge resulting from an agreement-in-principle with the U.S. Department of Justice to resolve an investigation into Wyeth’s historical promotional practices in connection with Rapamune. In the first nine months of 2012, primarily includes the aforementioned $491 million charge related to Rapamune, a $450 million settlement of a lawsuit by Brigham Young University related to Celebrex, and charges for hormone-replacement therapy litigation. In 2011, primarily includes charges for hormone-replacement therapy litigation.

 
(d)

Primarily included in Other deductions--net. In the first nine months of 2012, primarily includes certain intangible assets acquired in connection with our acquisitions of Wyeth and King, including in-process research and development (IPR&D) intangible assets. In the third quarter and first nine months of 2011, primarily includes certain intangible assets acquired in connection with our acquisition of Wyeth, including IPR&D intangible assets.

 
(e)

Costs incurred in connection with the potential initial public offering of a minority stake in our Animal Health business, Zoetis, Inc. Includes expenditures for banking, legal, accounting and similar services related to the potential transaction, as well as costs incurred associated with the potential separation of Animal Health employees, net assets and activities from Pfizer, such as consulting and systems costs. Included in Selling, informational and administrative expenses ($68 million) and Other deductions--net ($32 million) for the three months ended September 30, 2012. Included in Selling, informational and administrative expenses ($98 million) and Other deductions--net ($93 million) for the nine months ended September 30, 2012. Included in Selling, informational and administrative expenses for the three and nine months ended October 2, 2011.

 
(f)

Included in Provision/(benefit) for taxes on income. Includes a settlement with the U.S. IRS related to audits for multiple tax years that favorably impacted GAAP Reported net income by $1.1 billion, representing tax and interest, for the three and nine months ended September 30, 2012.

 
*  

Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS. Despite the importance of these measures to management in goal setting and performance measurement, we stress that Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are Non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS (unlike U.S. GAAP net income and its components and diluted EPS) may not be comparable to the calculation of similar measures of other companies. Non-GAAP Adjusted income and its components and Non-GAAP Adjusted diluted EPS are presented solely to permit investors to more fully understand how management assesses performance.

 
PFIZER INC.
BUSINESS REVENUES (1)
FIRST NINE MONTHS OF 2012 AND 2011
(UNAUDITED)
(millions of dollars)
         
 
 
2012   2011   Change  

ForeignExchange

  Operational
Primary Care $ 11,725 $ 17,259 (32 %) (1 %) (31 %)
Specialty Care 10,483 11,425 (8 %) (2 %) (6 %)
Established Products 7,865 6,914 14 % (2 %) 16 %
Emerging Markets 7,308 7,031 4 % (6 %) 10 %
Oncology   940     982   (4 %)   (3 %)   (1 %)
Biopharmaceutical 38,321 43,611 (12 %) (2 %) (10 %)
 
Animal Health 3,128 3,078 2 % (4 %) 6 %
Consumer Healthcare 2,276 2,218 3 % (2 %) 5 %
Other   193     211   (9 %)   (1 %)   (8 %)
 
Total $ 43,918   $ 49,118   (11 %)   (2 %)   (9 %)
 
 

 

(1)   For a description of each business unit, see Note 13A to Pfizer's condensed consolidated financial statements included in Pfizer's Form 10-Q for the fiscal quarter ended July 1, 2012.
 
PFIZER INC.
ADJUSTED SELECTED COSTS AND EXPENSES (1)
FIRST NINE MONTHS OF 2012 AND 2011
(UNAUDITED)
         
 
 

 

($ in millions)(Favorable)/Unfavorable

2012   2011   % Change  

ForeignExchange

  Operational
 
Adjusted Cost of Sales (1) $ 7,888 $ 8,951 (12%) (8%) (4%)
As a Percent of Revenues 18.0% 18.2% N/A N/A N/A
Adjusted SI&A Expenses (1) 11,623 13,549 (14%) (2%) (12%)
Adjusted R&D Expenses (1)   5,346     6,080   (12%)   (1%)   (11%)
 
Total $ 24,857   $ 28,580   (13%)   (4%)   (9%)
 

(1) Adjusted cost of sales, Adjusted selling, informational and administrative (SI&A) expenses and Adjusted research and development (R&D) expenses are defined as the corresponding reported U.S. generally accepted accounting principles (GAAP) income statement line items excluding purchase accounting adjustments, acquisition-related costs, discontinued operations and certain significant items. Reconciliations of certain GAAP reported to non-GAAP adjusted information for the third quarter and first nine months of 2012 and 2011 are provided in the materials accompanying this report. These adjusted income statement line item measures are not, and should not be viewed as, substitutes for the corresponding U.S. GAAP line items.

 
 

PFIZER INC.

REVENUES

THIRD QUARTER 2012 and 2011

(UNAUDITED)

(millions of dollars)

         
WORLDWIDE UNITED STATES TOTAL INTERNATIONAL (a)
                                             
2012   2011 % Change 2012   2011   % Change 2012   2011   % Change
            Total   Oper.           Total           Total   Oper.
TOTAL REVENUES   $13,976   $16,609   (16%)   (12%)   $5,627   $6,879   (18%)   $8,349   $9,730   (14%)   (7%)
REVENUES FROM BIOPHARMACEUTICAL PRODUCTS:   $12,117   $14,747   (18%)   (14%)   $4,769   $6,019   (21%)   $7,348   $8,728   (16%)   (9%)
Lipitor (b) 749 2,602 (71%) (70%) 192 1,470 (87%) 557 1,132 (51%)   (48%)
Lyrica 1,036 961 8% 14% 430 379 13% 606 582 4% 14%
Enbrel (Outside the U.S. and Canada) 893 957 (7%) 4% - - - 893 957 (7%) 4%
Prevnar 13/Prevenar 13 868 1,006 (14%) (12%) 440 454 (3%) 428 552 (22%) (19%)
Celebrex 676 643 5% 7% 438 405 8% 238 238 - 6%
Viagra 517 493 5% 9% 287 244 18% 230 249 (8%) -
Norvasc 319 350 (9%) (6%) 13 5 160% 306 345 (11%) (9%)
Zyvox 328 321 2% 7% 158 154 3% 170 167 2% 11%
Sutent 294 298 (1%) 7% 82 78 5% 212 220 (4%) 7%
Premarin family 262 267 (2%) (1%) 237 241 (2%) 25 26 (4%) 3%
Genotropin 212 215 (1%) 5% 59 46 28% 153 169 (9%) (2%)
Xalatan/Xalacom 181 277 (35%) (29%) 9 9 - 172 268 (36%) (31%)
BeneFIX 201 178 13% 18% 96 76 26% 105 102 3% 12%
Detrol/Detrol LA 176 213 (17%) (15%) 112 136 (18%) 64 77 (17%) (10%)
Vfend 187 171 9% 17% 21 -

100%

166 171 (3%) 3%
Chantix/Champix 146 156 (6%) (3%) 62 68 (9%) 84 88 (5%) 1%
Pristiq 152 146 4% 6% 120 119 1% 32 27 19% 32%
Refacto AF/Xyntha 150 140 7% 17% 28 32 (13%) 122 108 13% 25%
Revatio 135 140 (4%) 1% 78 80 (3%) 57 60 (5%) 6%
Zoloft 129 139 (7%) (3%) 17 15 13% 112 124 (10%) (5%)
Medrol 113 127 (11%) (7%) 24 33 (27%) 89 94 (5%) 1%
Zosyn/Tazocin 109 149 (27%) (24%) 39 75 (48%) 70 74 (5%) 1%
Effexor 107 165 (35%) (31%) 37 52 (29%) 70 113 (38%) (31%)
Geodon/Zeldox 57 263 (78%) (76%) 26 217 (88%) 31 46 (33%) (21%)
Zithromax/Zmax 89 93 (4%) (1%) 3 4 (25%) 86 89 (3%) 1%
Prevnar/Prevenar (7-valent) 81 98 (17%) 10% - - - 81 98 (17%) 10%
Fragmin 91 95 (4%) 4% 11 9 22% 80 86 (7%) 3%
Relpax 92 86 7% 11% 56 47 19% 36 39 (8%) 2%
Rapamune 92 96 (4%) 1% 49 47 4% 43 49 (12%) (2%)
Cardura 79 92 (14%) (9%) 2 1 100% 77 91 (15%) (9%)
Aricept (c) 71 117 (39%) (34%) - - - 71 117 (39%) (34%)
Tygacil 82 76 8% 15% 37 38 (3%) 45 38 18% 34%
EpiPen 67 59 14% 14% 52 47 11% 15 12 25% 23%
Xanax XR 66 77 (14%) (6%) 13 13 - 53 64 (17%) (7%)
BMP2 58 83 (30%) (30%) 58 77 (25%) - 6 (100%) (100%)
Caduet 68 150 (55%) (53%) 13 80 (84%) 55 70 (21%) (16%)
Sulperazon 62 51 22% 22% - - - 62 51 22% 22%
Diflucan 61 72 (15%) (9%) 1 - 100% 60 72 (17%) (11%)
Dalacin/Cleocin 74 51 45% 50% 40 15 167% 34 36 (6%) (1%)
Neurontin 52 67 (22%) (18%) 12 14 (14%) 40 53 (25%) (17%)
Unasyn 54 58 (7%) (3%) - 3 (100%) 54 55 (2%) 1%
Aromasin 51 85 (40%) (36%) 3 8 (63%) 48 77 (38%) (34%)
Arthrotec 50 61 (18%) (15%) 28 32 (13%) 22 29 (24%) (19%)
Inspra 51 51 - 12% 1 1 - 50 50 - 13%
Toviaz 52 49 6% 10% 29 26 12% 23 23 - 8%
Metaxalone/Skelaxin 55 57 (4%) (5%) 55 57 (4%) - - - -
Methotrexate 50 51 (2%) 5% - - - 50 51 (2%) 5%
Protonix 50 65 (23%) (23%) 50 65 (23%) - - - -
Alliance Revenue (d) 879 919 (4%) (3%) 687 571 20% 192 348 (45%) (42%)
All other biopharmaceutical products 1,643 1,611 2% 8% 564 476 18% 1,079 1,135 (5%) 3%
All other established products (e)   1,407   1,406   -   6%   453   388   17%   954   1,018   (6%)   2%
REVENUES FROM OTHER PRODUCTS:
ANIMAL HEALTH $1,017 $1,041 (2%) 4% $451 $433 4% $566 $608 (7%) 4%
CONSUMER HEALTHCARE $780 $767 2% 6% $388 $408 (5%) $392 $359 9% 18%
OTHER (f)   $62   $54   15%   19%   $19   $19   -   $43   $35   23%   28%

(a)

 

Total International represents Developed Europe region + Developed Rest of World region + Emerging Markets region. Details for these regions are located on the following page.

(b)

Lipitor lost exclusivity in the U.S. in November 2011 and various other markets in 2011 and 2012. This loss of exclusivity reduced branded worldwide revenues by $1.9 billion in the third quarter of 2012, in comparison with the third quarter of 2011.

(c)

Represents direct sales under license agreement with Eisai Co., Ltd.

(d)

Includes Enbrel (in the U.S. and Canada), Aricept, Exforge, Rebif and Spiriva.

(e)

Includes sales of generic atorvastatin. All other established products is a subset of All other biopharmaceutical products.

(f)

Includes revenues generated primarily from Pfizer CentreSource, our contract manufacturing and bulk pharmaceutical chemical sales organization.

 
Certain amounts and percentages may reflect rounding adjustments.
 
 

PFIZER INC.

REVENUES  

DETAIL OF INTERNATIONAL REVENUES BY GEOGRAPHIC REGION

THIRD QUARTER 2012 and 2011

(UNAUDITED)

(millions of dollars)

     
DEVELOPED EUROPE (a) DEVELOPED REST OF WORLD (b) EMERGING MARKETS (c)
                                                 
2012   2011   % Change 2012   2011   % Change 2012   2011   % Change
            Total   Oper.           Total   Oper.           Total   Oper.
TOTAL INTERNATIONAL REVENUES   $2,976   $4,027   (26%)   (16%)   $2,529   $2,807   (10%)   (8%)   $2,844   $2,896   (2%)   7%
REVENUES FROM BIOPHARMACEUTICAL PRODUCTS - INTERNATIONAL:   $2,672   $3,723   (28%)   (18%)   $2,287   $2,567   (11%)   (10%)   $2,389   $2,438   (2%)   6%
Lipitor (d) 130 595 (78%)   (75%) 207 337 (39%)   (38%) 220 200 10%   14%
Lyrica 324 326 (1%) 13% 185 162 14% 17% 97 94 3% 15%
Enbrel (Outside Canada) 555 626 (11%) 1% 148 139 6% 8% 190 192 (1%) 12%
Prevnar 13/ Prevenar 13 161 192 (16%) (5%) 63 84 (25%) (24%) 204 276 (26%) (28%)
Celebrex 37 46 (20%) (9%) 119 112 6% 10% 82 80 3% 9%
Viagra 92 102 (10%) 1% 48 57 (16%) (14%) 90 90 - 7%
Norvasc 27 38 (29%) (14%) 150 187 (20%) (20%) 129 120 8% 12%
Zyvox 73 78 (6%) 5% 37 38 (3%) - 60 51 18% 27%
Sutent 103 119 (13%) (2%) 44 42 5% 5% 65 59 10% 25%
Premarin family 2 3 (33%) - 11 7 57% 22% 12 16 (25%) (7%)
Genotropin 71 90 (21%) (9%) 56 55 2% 2% 26 24 8% 16%
Xalatan/Xalacom 57 126 (55%) (49%) 73 94 (22%) (21%) 42 48 (13%) (2%)
BeneFIX 63 69 (9%) 4% 33 25 32% 31% 9 8 13% 25%
Detrol/Detrol LA 29 38 (24%) (16%) 24 25 (4%) 4% 11 14 (21%) (14%)
Vfend 68 78 (13%) - 42 34 24% 14% 56 59 (5%) 2%
Chantix/Champix 27 37 (27%) (21%) 44 39 13% 18% 13 12 8% 18%
Pristiq - - - - 22 17 29% 41% 10 10 - 20%
Refacto AF/Xyntha 93 99 (6%) 6% 18 9 100% 138% 11 -

100%

*
Revatio 34 37 (8%) 6% 13 12 8% 17% 10 11 (9%) -
Zoloft 13 17 (24%) (18%) 67 74 (9%) (8%) 32 33 (3%) 9%
Medrol 21 24 (13%) (4%) 12 11 9% 9% 56 59 (5%) -
Zosyn/Tazocin 10 15 (33%) (20%) 3 4 (25%) - 57 55 4% 7%
Effexor 26 48 (46%) (38%) 18 39 (54%) (51%) 26 26 - 12%
Geodon/Zeldox 15 18 (17%) (11%) 4 7 (43%) - 12 21 (43%) (38%)
Zithromax/Zmax 11 15 (27%) (13%) 35 37 (5%) (3%) 40 37 8% 11%
Prevnar/Prevenar (7-valent) - 4 (100%) (100%) 70 94 (26%) (27%) 11 -

100%

*

Fragmin

45 45 - 9% 18 21 (14%) (5%) 17 20 (15%) (5%)
Relpax 17 20 (15%) (5%) 15 15 - 14% 4 4 - 25%
Rapamune 13 15 (13%) - 5 4 25% - 25 30 (17%) (3%)
Cardura 22 30 (27%) (14%) 31 37 (16%) (18%) 24 24 - 8%
Aricept (e) 18 61 (70%) (66%) 44 45 (2%) 5% 9 11 (18%) (9%)
Tygacil 17 16 6% 19% 2 1 100% 100% 26 21 24% 43%
EpiPen - - - - 15 12 25% 25% - - - -
Xanax XR 22 26 (15%) (4%) 10 12 (17%) (8%) 21 26 (19%) (12%)
BMP2 - 6 (100%) (100%) - - - - - - - -
Caduet 3 4 (25%) - 37 51 (27%) (25%) 15 15 - 14%

Sulperazon

-

-

-

-

9

11

(18%)

(18%)

53

40

33%

32%

Diflucan 14 21 (33%) (24%) 10 13 (23%) (17%) 36 38 (5%) (3%)
Dalacin/Cleocin 7 9 (22%) (11%) 7 7 - (14%) 20 20 - 5%
Neurontin 14 17 (18%) (6%) 10 14 (29%) (21%) 16 22 (27%) (23%)
Unasyn 9 8 13% 25% 17 21 (19%) (15%) 28 26 8% 4%
Aromasin 17 42 (60%) (52%) 13 17 (24%) (28%) 18 18 - 6%
Arthrotec 8 12 (33%) (25%) 12 13 (8%) - 2 4 (50%) (50%)
Inspra 31 33 (6%) 9% 15 13 15% 15% 4 4 - 25%
Toviaz 17 18 (6%) 6% 3 3 - - 3 2 50% 50%
Metaxalone/Skelaxin - - -

-

- - - - - - - -
Methotrexate 9 12 (25%) (17%) 40 38 5% 8% 1 1 - 100%
Protonix - -

-

-

- - - - - - - -

Alliance Revenue (f)

53 131 (60%) (55%) 128 196 (35%) (33%) 11 21 (48%) (43%)
All other biopharmaceutical products 294 357 (18%) (7%) 300 282 6% 5% 485 496 (2%) 10%
All other established products (g)   246   294   (16%)   (4%)   271   283   (4%)   (3%)   437   441   (1%)   10%
REVENUES FROM OTHER PRODUCTS - INTERNATIONAL:   $304   $304   -  

14%

  $242   $240   1%  

5%

  $455   $458   (1%)   9%
 

*

Calculation not meaningful.

(a)

Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries.

(b)

Developed Rest of World region includes the following markets: Australia, Canada, Japan, New Zealand and South Korea.

(c)

Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Middle East, Africa, Central and Eastern Europe and Turkey.

(d)

Lipitor lost exclusivity in various international markets in 2011 and 2012. This loss of exclusivity reduced branded international revenues by $579 million in the third quarter of 2012, in comparison with the third quarter of 2011.0

(e)

Represents direct sales under license agreement with Eisai Co., Ltd.

(f)

Includes Enbrel (in Canada), Aricept, Exforge, Rebif and Spiriva.

(g)

All other established products is a subset of All other biopharmaceutical products.

 
Certain amounts and percentages may reflect rounding adjustments.
 
 

PFIZER INC.

REVENUES

NINE MONTHS 2012 and 2011

(UNAUDITED)

(millions of dollars)

                     
 
WORLDWIDE UNITED STATES TOTAL INTERNATIONAL (a)
                                             
2012 2011 % Change 2012 2011 % Change 2012 2011 % Change
       

 

  Total   Oper.      

 

  Total      

 

  Total   Oper.
TOTAL REVENUES   $43,918   $49,118   (11%)   (9%)   $17,303   $20,603   (16%)   $26,615   $28,515   (7%)   (2%)
REVENUES FROM BIOPHARMACEUTICAL PRODUCTS:   $38,321   $43,611   (12%)   (10%)   $14,899   $18,246   (18%)   $23,422   $25,365   (8%)   (4%)
Lipitor (b) 3,364 7,578 (56%) (55%) 871 4,187 (79%) 2,493 3,391 (26%) (25%)
Lyrica 3,026 2,695 12% 16% 1,229 1,116 10% 1,797 1,579 14% 20%
Enbrel (Outside the U.S. and Canada) 2,780 2,741 1% 8% - - - 2,780 2,741 1% 8%
Prevnar 13/Prevenar 13 2,725 2,823 (3%) (1%) 1,423 1,533 (7%) 1,302 1,290 1% 5%
Celebrex 1,969 1,856 6% 7% 1,266 1,179 7% 703 677 4% 7%
Viagra 1,498 1,458 3% 5% 822 732 12% 676 726 (7%) (3%)
Norvasc 1,001 1,081 (7%) (7%) 38 23 65% 963 1,058 (9%) (9%)
Zyvox 996 965 3% 6% 490 486 1% 506 479 6% 11%
Sutent 913 870 5% 10% 255 218 17% 658 652 1% 8%
Premarin family 797 757 5% 6% 724 683 6% 73 74 (1%) 6%
Genotropin 619 654 (5%) (2%) 150 144 4% 469 510 (8%) (4%)
Xalatan/Xalacom 617 960 (36%) (33%) 30 159 (81%) 587 801 (27%) (24%)
BeneFIX 577 518 11% 14% 272 223 22% 305 295 3% 8%
Detrol/Detrol LA 576 668 (14%) (12%) 362 422 (14%) 214 246 (13%) (10%)
Vfend 543 558 (3%) 1% 64 64 - 479 494 (3%) 1%
Chantix/Champix 496 545 (9%) (7%) 234 248 (6%) 262 297 (12%) (9%)
Pristiq 461 422 9% 10% 365 348 5% 96 74 30% 36%
Refacto AF/Xyntha 420 380 11% 16% 79 75 5% 341 305 12% 19%
Revatio 414 393 5% 8% 250 229 9% 164 164 - 7%
Zoloft 398 420 (5%) (4%) 49 46 7% 349 374 (7%) (5%)
Medrol 388 383 1% 4% 105 116 (9%) 283 267 6% 9%
Zosyn/Tazocin 378 490 (23%) (21%) 175 267 (34%) 203 223 (9%) (5%)
Effexor 342 537 (36%) (34%) 102 207 (51%) 240 330 (27%) (24%)
Geodon/Zeldox 322 753 (57%) (56%) 218 627 (65%) 104 126 (17%) (10%)
Zithromax/Zmax 318 335 (5%) (4%) 9 17 (47%) 309 318 (3%) (2%)
Prevnar/Prevenar (7-valent) 303 406 (25%) (22%) - - - 303 406 (25%) (22%)
Fragmin 283 283 - 6% 36 32 13% 247 251 (2%) 5%
Relpax 266 250 6% 8% 160 142 13% 106 108 (2%) 4%
Rapamune 259 285 (9%) (6%) 140 139 1% 119 146 (18%) (13%)
Cardura 254 289 (12%) (9%) 4 4 - 250 285 (12%) (9%)
Aricept (c) 249 335 (26%) (22%) - - - 249 335 (26%) (22%)
Tygacil 249 224 11% 16% 115 112 3% 134 112 20% 28%
EpiPen (d) 217 160 36% 36% 182 133 37% 35 27 30% 33%
Xanax XR 203 232 (13%) (7%) 38 41 (7%) 165 191 (14%) (7%)
BMP2 192 277 (31%) (31%) 192 260 (26%) - 17 (100%) (98%)
Caduet 191 435 (56%) (55%) 26 235 (89%) 165 200 (18%) (16%)
Sulperazon 191 155 23% 22% - - - 191 155 23% 22%
Diflucan 185 201 (8%) (5%) 4 3 33% 181 198 (9%) (5%)
Dalacin/Cleocin 176 139 27% 31% 72 35 106% 104 104 - 5%
Neurontin 172 222 (23%) (19%) 37 51 (27%) 135 171 (21%) (17%)
Unasyn 165 172 (4%) (2%) 2 4 (50%) 163 168 (3%) (1%)
Aromasin 162 294 (45%) (43%) 10 53 (81%) 152 241 (37%) (34%)
Arthrotec 159 182 (13%) (11%) 90 96 (6%) 69 86 (20%) (15%)
Inspra 156 142 10% 16% 4 3 33% 152 139 9% 16%
Toviaz 150 137 9% 13% 82 72 14% 68 65 5% 11%
Metaxalone/Skelaxin (d) 149 145 3% 2% 149 145 3% - - - -
Methotrexate 148 133 11% 11% - - - 148 133 11% 11%
Protonix 140 168 (17%) (17%) 140 168 (17%) - - - -
Alliance Revenue (e) 2,577 2,678 (4%) (3%) 1,908 1,628 17% 669 1,050 (36%) (35%)
All other biopharmaceutical products 5,187 4,827 7% 11% 1,926 1,541 25% 3,261 3,286 (1%) 5%
All other established products (f)   4,509   4,207   7%   11%   1,633   1,287   27%   2,876   2,920   (2%)   4%
REVENUES FROM OTHER PRODUCTS:
ANIMAL HEALTH $3,128 $3,078 2% 6% $1,289 $1,205 7% $1,839 $1,873 (2%) 5%
CONSUMER HEALTHCARE $2,276 $2,218 3% 5% $1,054 $1,087 (3%) $1,222 $1,131 8% 13%
OTHER (g)   $193   $211   (9%)   (8%)   $61   $65   (6%)   $132   $146   (10%)   (7%)
 

(a)

Total International represents Developed Europe region + Developed Rest of World region + Emerging Markets region. Details for these regions are located on the following page.

(b)

Lipitor lost exclusivity in the U.S. in November 2011 and various other markets in 2011 and 2012. This loss of exclusivity reduced branded worldwide revenues by $4.2 billion in the first nine months of 2012, in comparison with the first nine months of 2011.

(c)

Represents direct sales under license agreement with Eisai Co., Ltd.

(d)

Legacy King product. King's operations are included in our financial statements commencing from the acquisition date of January 31, 2011.

(e)

Includes Enbrel (in the U.S. and Canada), Aricept, Exforge, Rebif and Spiriva.

(f)

Includes sales of generic atorvastatin. All other established products is a subset of All other biopharmaceutical products.

(g)

Includes revenues generated primarily from Pfizer CentreSource, our contract manufacturing and bulk pharmaceutical chemical sales organization.

 
Certain amounts and percentages may reflect rounding adjustments.
 
 

PFIZER INC.

REVENUES

DETAIL OF INTERNATIONAL REVENUES BY GEOGRAPHIC REGION

NINE MONTHS 2012 and 2011

(UNAUDITED)

(millions of dollars)

                       
 
DEVELOPED EUROPE (a) DEVELOPED REST OF WORLD (b) EMERGING MARKETS (c)
                                                 
2012 2011 % Change 2012 2011 % Change 2012 2011 % Change
       

 

  Total   Oper.      

 

  Total   Oper.      

 

  Total   Oper.
TOTAL INTERNATIONAL REVENUES   $10,025   $12,078   (17%)   (11%)   $7,830   $7,974   (2%)   (2%)   $8,760   $8,463   4%   10%
REVENUES FROM BIOPHARMACEUTICAL PRODUCTS - INTERNATIONAL:   $9,026   $11,064   (18%)   (12%)   $7,088   $7,270   (3%)   (3%)   $7,308   $7,031   4%   10%
Lipitor (d) 1,042 1,804 (42%) (39%) 777 955 (19%) (20%) 674 632 7% 9%
Lyrica 955 931 3% 11% 526 381 38% 38% 316 267 18% 26%
Enbrel (Outside Canada) 1,691 1,758 (4%) 4% 451 391 15% 13% 638 592 8% 17%
Prevnar 13/ Prevenar 13 496 545 (9%) (2%) 201 171 18% 19% 605 574 5% 8%
Celebrex 121 134 (10%) (2%) 341 307 11% 12% 241 236 2% 7%
Viagra 267 296 (10%) (4%) 152 158 (4%) (3%) 257 272 (6%) (1%)
Norvasc 91 127 (28%) (22%) 488 575 (15%) (17%) 384 356 8% 10%
Zyvox 224 229 (2%) 6% 115 108 6% 6% 167 142 18% 25%
Sutent 325 353 (8%) (1%) 128 122 5% 5% 205 177 16% 26%
Premarin family 7 8 (13%) (13%) 27 24 13% 12% 39 42 (7%) 2%
Genotropin 224 267 (16%) (10%) 166 162 2% 1% 79 81 (2%) 5%
Xalatan/Xalacom 220 385 (43%) (39%) 232 270 (14%) (15%) 135 146 (8%) 1%
BeneFIX 182 193 (6%) 1% 98 82 20% 18% 25 20 25% 30%
Detrol/Detrol LA 97 119 (18%) (14%) 74 82 (10%) (9%) 43 45 (4%) 2%
Vfend 203 226 (10%) (3%) 118 108 9% 5% 158 160 (1%) 4%
Chantix/Champix 94 134 (30%) (27%) 132 124 6% 6% 36 39 (8%) 3%
Pristiq - - - - 62 48 29% 33% 34 26 31% 42%
Refacto AF/Xyntha 274 279 (2%) 5% 44 25 76% 83% 23 1 * *
Revatio 100 105 (5%) 3% 40 34 18% 18% 24 25 (4%) 8%
Zoloft 44 61 (28%) (23%) 207 217 (5%) (6%) 98 96 2% 8%
Medrol 70 78 (10%) (3%) 36 35 3% - 177 154 15% 18%
Zosyn/Tazocin 37 49 (24%) (18%) 11 11 - - 155 163 (5%) (1%)
Effexor 84 141 (40%) (35%) 80 114 (30%) (30%) 76 75 1% 7%
Geodon/Zeldox 46 58 (21%) (14%) 15 17 (12%) - 43 51 (16%) (8%)
Zithromax/Zmax 45 61 (26%) (20%) 134 131 2% 1% 130 126 3% 5%
Prevnar/Prevenar (7-valent) - 22 (100%) (100%) 258 277 (7%) (10%) 45 107 (58%) (44%)
Fragmin 135 132 2% 8% 58 57 2% 9% 54 62 (13%) (5%)
Relpax 50 56 (11%) (4%) 43 40 8% 8% 13 12 8% 17%
Rapamune 39 45 (13%) (7%) 13 13 - - 67 88 (24%) (17%)
Cardura 72 94 (23%) (18%) 102 116 (12%) (14%) 76 75 1% 7%
Aricept (e) 93 171 (46%) (42%) 126 125 1% 5% 30 39 (23%) (15%)
Tygacil 50 49 2% 10% 5 4 25% 25% 79 59 34% 44%
EpiPen (f) - - - - 35 27 30% 33% - - - -
Xanax XR 65 80 (19%) (11%) 33 36 (8%) (8%) 67 75 (11%) (1%)
BMP2 - 17 (100%) (100%) - - - - - - - -
Caduet 10 13 (23%) (15%) 108 143 (24%) (24%) 47 44 7% 11%
Sulperazon - - - - 27 32 (16%) (19%) 164 123 33% 33%
Diflucan 47 59 (20%) (14%) 30 35 (14%) (14%) 104 104 - 3%
Dalacin/Cleocin 23 26 (12%) (4%) 21 19 11% 5% 60 59 2% 10%
Neurontin 45 58 (22%) (17%) 31 42 (26%) (24%) 59 71 (17%) (11%)
Unasyn 27 26 4% 12% 55 61 (10%) (10%) 81 81 - 1%
Aromasin 57 142 (60%) (56%) 41 51 (20%) (22%) 54 48 13% 17%
Arthrotec 26 37 (30%) (24%) 35 37 (5%) (3%) 8 12 (33%) (25%)
Inspra 96 92 4% 13% 44 37 19% 16% 12 10 20% 30%
Toviaz 54 52 4% 12% 7 7 - 17% 7 6 17% 17%
Metaxalone/Skelaxin (f) - - - - - - - - - - - -
Methotrexate 28 33 (15%) (9%) 117 98 19% 16% 3 2 50% 50%
Protonix - - - - - - - - - - - -
Alliance Revenue (g) 204 433 (53%) (50%) 414 557 (26%) (26%) 51 60 (15%) (5%)
All other biopharmaceutical products 966 1,086 (11%) (4%) 830 804 3% 2% 1,465 1,396 5% 13%

All other established products (h)

  769   883   (13%)   (6%)   786   806   (2%)   (3%)   1,321   1,231   7%   16%
REVENUES FROM OTHER PRODUCTS - INTERNATIONAL:   $999   $1,014   (1%)   6%   $742   $704   5%   7%   $1,452   $1,432   1%   8%
 

*

Calculation not meaningful.

(a)

Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries.

(b)

Developed Rest of World region includes the following markets: Australia, Canada, Japan, New Zealand and South Korea.

(c)

Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Middle East, Africa, Central and Eastern Europe and Turkey.

(d)

Lipitor lost exclusivity in various international markets in 2011 and 2012. This loss of exclusivity reduced branded international revenues by $914 million in the first nine months of 2012, in comparison with the first nine months of 2011.

(e)

Represents direct sales under license agreement with Eisai Co., Ltd.

(f)

Legacy King product. King's operations are included in our financial statements commencing from the acquisition date of January 31, 2011.

(g)

Includes Enbrel (in Canada), Aricept, Exforge, Rebif and Spiriva.

(h)

All other established products is a subset of All other biopharmaceutical products.

 
Certain amounts and percentages may reflect rounding adjustments.
 

PFIZER INC. SUPPLEMENTAL INFORMATION

1. Change in Reported Cost of Sales

Reported cost of sales decreased 22% in both the third quarter and in the first nine months of 2012, compared to the same periods in 2011. The decreases were primarily due to a decline in revenues reflecting reduced manufacturing volumes related to products that lost exclusivity in various markets. The decreases were also due to lower purchase accounting adjustments in 2012, lower costs related to our cost-reduction and productivity initiatives, as well as the benefits generated from the ongoing productivity initiatives to streamline the manufacturing network, and favorable foreign exchange of 8% for the third quarter of 2012 and 7% for the first nine months of 2012. The decreases were partially offset by an unfavorable impact caused by a shift in geographic and business mix.

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