10-KPeriod: FY2002

PFIZER INC Annual Report, Year Ended Dec 31, 2002

Filed March 27, 2003For Securities:PFE

Summary

Pfizer Inc. reported strong performance in its 2002 fiscal year, driven primarily by its Pharmaceutical segment, which accounted for 87% of revenues. The company highlighted significant growth in its top-selling human pharmaceutical products, including Lipitor, Norvasc, Zoloft, Neurontin, Celebrex, Viagra, Zithromax, Zyrtec, Diflucan, and Aricept, which collectively grew at a 15% rate. The company also noted advancements in its product pipeline and regulatory approvals for new uses of existing drugs. Furthermore, Pfizer announced its strategic intent to acquire Pharmacia Corporation for approximately $60 billion, a move expected to further strengthen its market position. The company is actively divesting non-core consumer product lines to focus on its core pharmaceutical business.

Key Highlights

  • 1Pharmaceutical segment remains the primary revenue driver, contributing 87% of total revenue in 2002.
  • 2Ten major human pharmaceutical products, including Lipitor and Norvasc, generated substantial revenue and experienced a combined growth rate of 15% in 2002.
  • 3Significant R&D investment of $5.2 billion in 2002, with over 160 projects in development and hundreds in discovery research.
  • 4Announced a proposed acquisition of Pharmacia Corporation for approximately $60 billion, pending regulatory approvals.
  • 5Divesting several consumer product lines, including Adams confectionery and Schick-Wilkinson Sword, to streamline business operations.
  • 6International operations represent a significant portion of revenue (35.9% in 2002), with key markets in Japan.
  • 7The company is actively managing patent expirations and generic competition, with ongoing legal challenges for key products.

Frequently Asked Questions

Pfizer's primary revenue source is its Pharmaceutical segment, which includes human pharmaceuticals and animal health products, as well as capsule manufacturing (Capsugel). The Consumer Products segment also contributes to revenue through over-the-counter medications.

The company's growth is driven by its pharmaceutical products, particularly blockbuster drugs like Lipitor, Norvasc, Zoloft, and Viagra. These products address significant therapeutic areas such as cardiovascular diseases, infectious diseases, and central nervous system disorders. The company also emphasizes its strong research and development pipeline for future growth.

The most significant strategic initiative is the proposed acquisition of Pharmacia Corporation, valued at approximately $60 billion. Additionally, Pfizer is divesting certain non-core consumer product businesses to focus on its core pharmaceutical operations.

Key risks include intense competition, particularly from generic drug manufacturers as patents expire. Pricing pressures from managed care organizations and government regulations, potential patent litigation, and the inherent uncertainties and costs associated with pharmaceutical research and development are also significant challenges.