UPDATE 1-Nektar says Pfizer botched Exubera marketing

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By Ransdell Pierson

NEW YORK, Oct 18 (Reuters) - Nektar Therapeutics (NKTR.O) on Thursday said it was given no advance notice about Pfizer Inc's decision to "walk away" from their shared Exubera inhaled insulin drug and said it was disappointed in Pfizer's performance in marketing the unpopular medicine.

"We first learned this morning of Pfizer's decision to walk away from Exubera from their press release," Nektar Chief Executive Officer Howard Robin said in a company statement.

"Pfizer has publicly acknowledged its organizational difficulties and resulting poor performance in launching Exubera," Robin said.

Officials at New York-based Pfizer (PFE.N) said it was unable to inform the tiny partner it was parting ways until Pfizer had already made the announcement public.

"Because of Securities and Exchange Commission rules we could not reach out to them until this morning, which we did," said Pfizer spokesman Andy McCormick. McCormick said Pfizer withheld the news from Nektar until then because it was "material information" related to Pfizer's quarterly earnings.

Earlier Thursday, Pfizer said it would return the rights to the drug to Nektar. Exubera was approved in the United States in January 2006, after years of delays and difficulties developing the product.

The world's first form of inhaled insulin has been dogged by poor sales, posting revenue of only $12 million for the first nine months of 2007 despite a national direct-to-consumer advertising campaign over the summer.

By contrast, cholesterol fighter Lipitor -- Pfizer's biggest product -- has racked up sales of $9.2 billion so far this year.

Nektar shares closed down $1.41, or 17.5 percent, to $6.67 on Nasdaq, while Pfizer slipped 1 cent to $24.54 on the New York Stock Exchange.

Pfizer, the world's largest drugmaker, took a $2.8 billon charge in the third quarter to end its involvement with Exubera. Moreover, Pfizer said it had halted development of second-generation forms of inhaled insulin.

Pfizer is considered one of the industry's most aggressive marketers, having built Lipitor and many other drugs into blockbuster brands.

But its marketing machine sparked and sputtered in efforts to get Exubera off the ground, in part because the canister used to administer its powdered clouds of insulin was considered clunky and bulky.

((Reporting by Ransdell Pierson, editing by Jeffrey Benkoe; Reuters Messaging: ransdell.pierson.reuters.com@reuters.net; 646-223-6034; ransdell.pierson@reuters.com)) Keywords: NEKTAR PFIZER/

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