The unit, which is valued at around $20 billion, was put on sale by Pfizer to streamline more investment to the R&D of prescription drugs. Though the consumer segment is a lucrative area given the aging population as well as the rising trend of self-medication, the unit had become a slow-growth segment due to intense competition from generic drugs and online sales.
Ibrance is still the star
Lack of a solid pipeline of drugs in a market that is stuffed with generic alternatives and biosimilars is what worries Pfizer the most at the moment. The oncology segment is the strongest and is likely to see a growth of 20% this year, thanks to Ibrance. The drug, which is used to treat breast cancer, is expected to post sales of about $3.8 billion by the end of this year.
Apart from this, there is hardly anything to be positive about the company since a number of other popular drugs are nearing patent expiry. Meanwhile, earnings are expected to see double-digit growth this year helped by the recent tax reform, while revenue is predicted to increase 3.5%.
A sale would help the company divert more funds to the growth areas, but only if the expected terms are met. Otherwise, the consumer segment is not detrimental in any way since the company has strong cash flow and balance sheet.