Pfizer 2005 Annual Report Download - page 21

20 2005 Financial Report
Financial Review
Pfizer Inc and Subsidiary Companies
Drug candidates in late-stage development include maraviroc
(UK-427,857), a CCR-5 receptor antagonist for HIV; torcetrapib/
atorvastatin, a combination CETP inhibitor/statin for heart disease;
asenapine, for schizophrenia and bipolar disorder, under
co-development with Akzo Nobel’s Organon healthcare unit;
Zithromax/chloroquine for treatment of malaria; PF-3512676, a
toll-like receptor 9 agonist for non-small cell lung cancer developed
in partnership with Coley Pharmaceutical Group, Inc. (Coley);
and ticilimumab (CP-675,206), an anti-CTLA4 monoclonal antibody
for melanoma. The FDA has granted fast-track designation for
maraviroc’s clinical development program.
Torcetrapib/atorvastatin, which combines the new chemical entity
torcetrapib (a CETP inhibitor discovered by Pfizer that raises HDL-
cholesterol) with atorvastatin (Lipitor), is continuing in global
Phase 3 clinical trials. This comprehensive 12,000-subject
development program includes three comparative atherosclerotic
imaging trials (a coronary intravascular ultrasound study and
two carotid ultrasound studies), as well as a full range of blood-
lipid efficacy studies comparing torcetrapib/atorvastatin to Lipitor,
other statins and fibrates. In addition to these Phase 3 studies, the
development program includes a definitive mortality and
morbidity trial that is enrolling 13,000 patients.
Despite effective treatments, cardiovascular disease remains the
number one killer worldwide with a residual relative risk of 60%
to 70% after treatment with statins. Therefore, the primary
objective of the torcetrapib/atorvastatin development program
is to provide clear evidence that substantially raising HDL-
cholesterol and further lowering LDL-cholesterol can reduce
cardiovascular risk beyond what can be achieved with current
treatments. Torcetrapib will be developed with atorvastatin in
order to rigorously test this hypothesis and the new CETP
inhibition mechanism of action. This development program
represents a major commitment by Pfizer to significantly advance
the understanding of lipids and atherosclerosis in order to provide
an important new tool for patients and prescribers in preventing
and treating the global burden of cardiovascular disease.
On November 21, 2005, Pfizer announced an agreement to
purchase development, manufacturing and marketing rights of
drugs to treat chronic inflammatory conditions from Incyte
Corporation (Incyte). Milestone payments of up to $803 million
could potentially be made to Incyte. Under the collaborative
research and license agreement, Pfizer will receive exclusive rights
to Incyte’s portfolio of CCR2 antagonist compounds. The
agreement is subject to regulatory approval.
In May 2005, we announced an agreement to collaborate with
Renovis Pharmaceuticals, Inc. (Renovis) for the research and
development of antagonists of vanilloid receptor 1 for the
treatment of neuropathic and other types of chronic pain. Under
the terms of the agreement, we expensed a payment of $10
million made in the second quarter of 2005, which was included
in Research and development expenses. Additional milestone
payments of $175 million could potentially be made to Renovis
based upon clinical trials, regulatory filing and approvals, as well
as the attainment of certain agreed upon sales levels.
In March 2005, we announced a license agreement with Coley for
ProMune, ProMune combination products and ProMune vaccine
products for the treatment, control and prevention of cancer.
Under the terms of the agreement, we expensed a payment of
$50 million made in the first quarter of 2005, which was included
in Research and development expenses, and purchased $10 million
of Coley’s common stock. Additional milestone payments of $455
million could potentially be made to Coley based upon clinical
trials, regulatory approvals and the launch of a ProMune product
by Pfizer.
In January 2005, we entered into a collaborative research and
license agreement with Rigel Pharmaceuticals, Inc. (Rigel) to
identify, develop and commercialize Syk tyrosine kinase inhibitors
for the use in diagnosis, treatment and prevention of certain
allergy and respiratory conditions. Under the terms of the
agreement we expensed a payment of $10 million made in the
first quarter of 2005, which was included in Research and
development expenses, and purchased $5 million of Rigel’s
common stock. Additional milestone payments of $130 million
could potentially be made to Rigel based upon development
stages, clinical trials, regulatory approvals and the successful
commercialization of a product.
In October 2003, we announced a global agreement to collaborate
with Organon for asenapine, a treatment for schizophrenia and
bipolar disorder. Under the terms of the agreement, we expensed
a payment of $100 million made in the fourth quarter of 2003,
which was included in Research and development expenses.
Additional milestone payments of $270 million could potentially
be made to Organon based upon regulatory approvals and launch
of asenapine in the U.S., E.U., and Japan, as well as the attainment
of certain agreed-upon sales levels.
In December 2002, we announced an agreement with Neurocrine
for indiplon, for the treatment of insomnia. Under the terms of
the agreement, we expensed a payment of $100 million made in
the first quarter of 2003, which was included in Research and
development expenses. Additional milestone payments of $300
million could potentially be made to Neurocrine based on
worldwide regulatory submissions and approvals. In 2005 and
2004, we expensed $70 million and $21 million in milestone
payments (of the $300 million), which were included in Research
and development expenses.
Also in December 2002, we announced an agreement with Eyetech
Pharmaceuticals, Inc. (Eyetech) for Macugen (pegaptanib sodium),
a treatment for AMD, which was approved by the FDA in
December 2004 and by the E.U. in January 2006, and diabetic
macular edema (DME), both leading causes of blindness. Eyetech
was subsequently acquired by OSI. Under the terms of the
agreement we expensed a payment of $100 million in the first
quarter of 2003, which was included in Research and development
expenses. Additional milestone payments up to $195.5 million
could potentially be made to OSI based on worldwide regulatory
submissions and approvals. OSI also has the potential to receive
an additional $450 million in milestone payments, which are
contingent upon successful commercialization of Macugen and
attainment of agreed-upon sales levels. In 2004, based on certain
regulatory submissions and approvals, we expensed $16 million
in milestone payments, which were included in Research and
development expenses and in connection with the approval, we