Pfizer has abandoned efforts to jointly develop Altana's smoker's lung drug Daxas after a study showed it did not work as well as the companies hoped, sending stock in the German firm plummeting. Pfizer will return all rights to the drug to Altana, the German company said in a statement on Friday.
Analysts had said the drug could fetch Altana 1 billion euros ($1.21 billion) in annual sales and it is considered vital to reducing company's dependence on its flagship medicine, anti-ulcer treatment pantoprazole.
The move is also a blow for Pfizer, which banks on new products to replace existing drugs as they lose their patents and to compensate for lost sales of Bextra, an arthritis drug withdrawn due to safety concerns.
Altana teamed with Pfizer, the world's biggest drugs firm, in part for its marketing clout and analysts said Friday's decision will likely delay the drug's launch.
Altana's management said in a conference call that they were still confident of reaching their target of maintaining or slightly increasing full-year earnings despite the increased cost of assuming sole responsibility for developing the drug.
Hans-Joachim Lohrisch, the head of Altana's pharmaceuticals business, said that he still expected blockbuster potential for Daxas, industry jargon for sales of over $1 billion.