Thanks to the Exubera flop and generic competition, net income fell 77 percent. And so the drugmaker will no longer market the inhaled insulin device, which was likened to a bong and became one of the industry’s best-known failures in recent memory. “Despite our best efforts, Exubera has failed to gain the acceptance of patients and physicians. We have therefore concluded that further investment in this product is unwarranted,” Pfizer ceo Jeff Kindler says in a statement.

Pfizer took a $2.8 billion to discontinue the big flop. This is a case of cutting his losses, but it doesn’t ease the pressure on Jeff. While he has $23 billion in cash, he has to figure out how to best use it to revive Pfizer’s ailing fortunes. Losses from patent expirations over the next three years, when generic versions of Lipitor will become available, will only compound his problems. Earlier this month, he announced plans to create a new biotech center to work with the R&D group, but Kindler is increasingly expected to buy his way out of his hole, at least to some extent.

“It really becomes a question of what they can do with their strong balance sheet to fill the hole at the end of the decade,” Deutsche Bank analyst Barbara Ryan tells Bloomberg News. “They either have to do a whole handful of smaller deals or one gigantic deal, and it remains to be seen what path they will take.”

Net income declined to $761 million, or 11 cents a share, from $3.36 billion, or 47 cents, a year earlier, but excluding certain costs, Pfizer earned 58 cents. Revenue fell to $12 billion from $12.3 billion a year earlier. This reflects the continued slump in Lipitor sales, which inched down 3 percent to $3.2 billion worldwide.