Pfizer Inc. on Wednesday reported lower-than-expected quarterly earnings on competition with generics, and said global sales of cholesterol fighter Lipitor fell 13 percent amid slipping demand for the company's flagship product.

The world's biggest drug maker, whose shares fell more than 2 percent in early electronic trading, said it earned $1.27 billion, or 18 cents per share in the period. That compares with $2.42 billion, or 33 cents per share, a year earlier.

Excluding special items, New York-based Pfizer earned 42 cents per share. Analysts on average expected 50 cents, according to Reuters Estimates. The company affirmed its 2007 and 2008 profit forecasts.

Pfizer, hurt by the recent loss of patent protection on its anti-depressant Zoloft and blood pressure treatment Norvasc, said global company revenue fell 6 percent to $11.08 billion. That was shy of Wall Street expectations of $11.44 billion.

I think this is a disappointing result, particularly relative to their first quarter report, Leerink Swann & Co. analyst Seamus Fernandez said.

The company said sales of Lipitor, by far the world's biggest drug, rose 5 percent overseas but tumbled 25 percent in the important U.S. market. Global Lipitor sales were $2.7 billion.

Pfizer attributed Lipitor's U.S. freefall to declining prescriptions of the medicine, now facing competition from far cheaper generic forms of Merck & Co's Zocor, and by patterns of stocking by wholesalers and related factors.

The wholesaler inventory patterns should not have a negative impact on U.S. Lipitor sales during the rest of the year, New York-based Pfizer said.

For the full year, the company expects Lipitor sales to range from flat to a 5 percent decline compared with 2006.

Lipitor, whose U.S. patent could expire as soon as 2010, is showing weakness at a time when Pfizer has no apparent cholesterol medicine to replace it. The company scrapped development of another possible blockbuster cholesterol drug in December.

Aside from Lipitor, Leerink's Fernandez said sales of schizophrenia drug Geodon, painkiller Celebrex and erectile dysfunction drug Viagra came in below expectations.

Geodon sales rose 8 percent to $178 million, while sales of Celebrex edged up 1 percent to $478 million. Viagra sales slipped 3 percent to $382 million.

Sales of Lyrica, its neuropathic pain drug that recently won U.S. approval for fibromyalgia, jumped 49 percent to $405 million.

Net income was hurt by a number of charges related to restructuring, acquisitions and deals, including payments made to Bristol-Myers Squibb (BMY.N: Quote, Profile, Research) related to their co-development of a drug to prevent blood clots.

Pfizer shares fell to $25.30 in early electronic trading from a Tuesday close of $25.96 on the New York Stock Exchange.

(Reporting by Ransdell Pierson and Lewis Krauskopf)