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Another drug in Pfizer’s (PFE - Analyst Report) portfolio started facing generic competition recently. Generic competition for Pfizer’s pulmonary arterial hypertension (PAH) drug, Revatio (sildenafil) tablets has entered the market with Mylan (MYL - Analyst Report) launching its generic version of the drug.

Apart from Mylan, Watson Pharmaceuticals also gained approval for its generic version of Revatio. Watson Pharma intends to launch its product shortly.

According to IMS Health, US sales of Revatio tablets in the 12 months ending September 30, 2012, were $338.7 million. While Revatio tablets lost exclusivity in September 2012, Revatio intravenous injection is slated to lose exclusivity in May 2013.

We note that Revatio contains the same medicine, sildenafil, as erectile dysfunction drug, Viagra. With the availability of a cheaper version in the market, we expect significant erosion of Revatio sales.

We currently have a Neutral recommendation on Pfizer, which carries a Zacks #3 Rank (short-term Hold rating). Pfizer is currently facing generic competition for several of its products including Lipitor, Geodon and Xalatan. These products are all facing declining sales due to generic competition.

Pfizer has been looking to offset the impact of generic competition by bringing new products to market. The company has been focusing on the development of treatments in the fields of oncology, cardiology, metabolic disorders, neuroscience, immunology, inflammation and vaccines. These are areas in which the company believes it can take leading positions.

Pfizer received a boost last week with the FDA approval of its JAK (Janus kinase) inhibitor, Xeljanz (tofacitinib). The FDA approved Xeljanz (5 mg twice daily) for the treatment of moderately to severely active rheumatoid arthritis (RA) in adults who have not responded sufficiently to or are unable to tolerate methotrexate.

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