Two pharmaceutical giants are set to join forces with the announcement that Pfizer, New York, will pay $68 billion in cash and stock to acquire drugmaker Wyeth, Madison, N.J. Financing for the deal includes $22.5 billion in loans from a consortium of banks, according to a news release.
Announcement of the acquisition came on the heels of quarterly reports showing both drugmakers experienced profit losses during their most recent quarters. Wyeths profit was 71 cents per share for the fourth quarter of 2008 compared with 75 cents per share during the year-ago period. Pfizer reported a 90% drop in fourth-quarter profits, down to 4 cents a share, resulting from a $2.3 billion write-off of legal expenses and settlement fees stemming from charges that the company engaged in off-label marketing practices. Pfizer also is expected to slash some 8,000 jobs as a cost-saving move.
The acquisition is expected to strengthen Pfizers product pipeline in a variety of therapeutic areas, including development of treatments for Alzheimers disease, inflammatory diseases, cancer treatment, vaccines and pain management, company officials said.