`
`
`
`
`
`2006 ANNUAL REVIEW
`
`Strong Medicine
`
`Our Prescription for Change
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 1 of 44 -
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 1 of 44
`
`

`

`
`
`WATSON LABORATORIES, mc. ,Ex. 1 126, p. 2 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 2 of 44
`
`

`

`CHAIRMAN’S LETTER TO SHAREHOLDERS
`
`
`
`To Our Owners, .
`
`I am writing to you at a time of rapid change“—
`for Pfizer and for the global pharmaceutical
`industry. Since I became Chief Executive Officer
`last July and formed our new management
`team, all of our energies have been focused on
`improving the performance and prospects of
`the company—and therefore on creating value
`for you.
`
`WATSON LABORATORIES, mc. ,Ex. 1 126, p. 3 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 3 of 44
`
`

`

`Pfizer has considerable strengths—“talented,
`experienced and dedicated'people, outstanding
`medicines, a promising pipeline, strong
`financial resources, and unmatched scale.
`We have a powerful foundation and legacy
`on which to build our future.
`
`At the same time, both our operating
`environment and our industry are changing
`rapidly in ways that present significant new
`challenges to meet, as well as exciting new
`opportunities to seize. And, despite strong
`performances from many of our iii-line products
`and a promising pipeline, recent and future
`losses of exclusivity on some. of the most
`successful medicines in history will temper our
`revenue growth.
`'
`We are in the early stages of making the
`changes we must make to succeed in light of
`our changing business environment. We are
`realistic. We are determined.' And we are
`
`moving with a sense of urgency We. are aiso
`committed to being open and transparent in
`communicating our progress to everyone with
`a stake in our future.
`
`i’f‘lzer is exceptionally wefl—posit‘hmed
`to capitalize on what may be. this century’s
`most compelling opportunity. The world‘s
`population is aging, but incomes are growing
`and the expectations for improved healthcare
`are increasing accordingly, in both the developed
`and the developing world. The demand for
`what we (lo—and what we can and will do in
`
`the future—will continue to grow. Despite the
`enormous progress society has made in
`preventing and treating disease, there is still a
`long list of unmet medical needs that lead to
`premature illness, disability and death.
`Innovative medicines and related products
`and services are the world’s best hope for meeting
`those needs in a cost-effective manner.
`
`rf‘he good news is that, while demand for better
`healthoare grows. scientists are gaining more and
`more knowledge about how the body works, and
`
`what it needs to stay healthy. At Pfizer, We have
`more product candidates, more clinical trials and
`more research programs than at any time in our
`history. We have a broad set of promising new
`therapies in oncology, cardiovascular disease,
`obesity, schizophrenia, rheumatoid arthritis, HIV
`infection and Alzheimer’s disease, among others.
`All told, we have more than 175 new compounds
`in development, and the resources to deve10p
`I
`them and find more. We are very optimistic that,
`in the years ahead. you will see Pfizer associated
`with the kind of medical breakthroughs that we’ve
`introduced throughout our history. Our ultimate
`goal is to have a larger, more diversified portfolio
`of uniquely valuable medicines, complemented by
`value-added products and services.
`At the same time. we understand that our
`perception of what’s innovative only matters
`if our customers share it. Governments. managed
`care organizations and physicians have enormous
`influence over patients" ability to obtain and
`afford our medicines and we need to work in close
`
`partnership with them, so that our innovations
`reach asmany patients as possible.
`We must also become more open to new
`people and innovative ideas, wherever we can
`find them. And it is essential that we become
`
`a more streamlined company—one that listens
`to its employees and Customers, moves quickly,
`and gives its people more opportunities for growth
`while holding them accountable for performance.
`' Making these kinds of changes will take time
`and commitment. But we have already taken
`several important steps.
`We appointed a new executive leadership team
`and we are continuing to develop the leadership
`we need going forward. We cut back on layers of
`
`WATSON LABORATORIES, INC. ,Ex. 1 126, p. 4 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 4 of 44
`
`

`

`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 5 of 44
`
`

`

`
`
`
`
`management and streamlined dec'sion making.
`To become more efficient and ct'iz'ective in serving
`our customers in our largest market, the United
`States, we reduced our sales force by 20 percent
`while maintaining a strong share of voice on all
`our key products. And we responded to investor
`calls for greater transparency of our pipeline.
`These actions are, all aimed at improving
`shareholder return going forward. We also
`continue to maintain our focus on current
`
`results. We met our financial targets for the
`year: our revenues grew 2 percent, to more
`than $48 billion, despite the. loss ofexclusivity
`in the USS. on Zithromax and Zoloft, and we
`delivered earnings per share in line with
`our forecast to the financial connnuuity. And,
`further reflecting our commitment to enhance
`Shareholder returns, we bought back $7 billion
`in stock in 2006 and ‘aised our first quarter
`2.007 dividend by 21 percent.
`But. as l have noted, we. are in the early
`stages of what we must do to transform
`the company, To provide a disciplined framework
`for this process, we have established five
`immediate priorities. We believe that successful
`execution of each of these priorities will enable
`us to increase total shareholder return as
`
`our owners expectwand deserve.
`OUR FIRST PRIORITY—maximizing
`
`revenues has to start with Lipitor,-the
`lipid-lowering medicine that is the world’s
`
`most prescribed b winded pharmaceutical.
`Lipitor faces a challenging environment marked
`by increased competition from both generics
`and other branded precincts. We believe this
`extraordinary medicinciwhich has more
`than 133 million years of patient experience~
`offers an exceptional value in terms of safety
`and efficacy in reducing the risk of heart attacks
`and stroke. Lipitor‘s advantages are supported
`by more than 100 clinical studies, and we will
`underscore its unique package of benefits to
`physicians and patients throughout this year.
`in addition, we are focusing special efforts
`on key new additions to our portfolio, including
`Lyrica for neuroDathic pain, Chantix for
`smoking cessation, and Sutent for cancer. In 2006
`we launched Exuhera, the first-ever inhalahle
`insulin delivery system, and Eraxis, a highly
`valuable antifungal. Other medicines in our
`portfolio. such as Geodon for schizophrenia and
`bipolar disorder, Caduet for cardiovascular
`risk factors, and Celebrex for arthritis pain,
`are all important contributors to our results.
`Overaii, nine Pfizer medicines each exceeded
`$1 billion in revenues in 2006.
`We are also making new investments in
`highly promising areas. such as oncology and
`hiotherapeutics. These investments will help
`us generate more new products from our newly
`reorganized and more efficient R&D organization.
`Our goal is to triple our Phase III pipeline by
`the end of 2009, and then to launch four new,
`
`
`
`#-
`
`I
`I-
`
`I-
`
`I
`
`.-
`
`I-
`
`I-l-I
`
`--r|'
`
`_ ..
`
`--.I;
`I-II
`I+ F-'I
`I- -
`—|-—-—-|-. III-"Iri- JI-I-IIIII-
`-.I.I..
`ll
`I
`-
`
`a
`
`In
`—I--|
`
`--
`
`-
`
`--I
`
`-
`
`'IIII.I -...
`.-
`- ---
`
`.II.I.I. _
`-|_.I_....
`I
`II..
`-I u. III
`II
`J _I.
`_
`
`WATSON LABORATORIES, mc. ,Ex. 1 126, p. 6 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 6 of 44
`
`

`

`internally developed products each year starting
`in 2011. We discuss a number of new products
`in development in this report.
`Our external business development activities
`complement our internal new—product pipeline
`and will secure both new medicines, as well
`as related products and services that enhance
`the value of our medicines. Here, too, we. have
`an aggressive goal: to launch. two new externally
`sourced products each year, beginning in 2010.
`Vice Chairman David Shedlarz offers a detailed
`
`review of our new business development strategy
`later in this report.
`With regard to OUR SECOND PRIORITYW
`creating a lower and more flexible cost bascwr-
`_ we have announced our intention to reduce
`our absolute costs by up to $2 billion by the end
`of next year. We continue to consolidate our
`worldwide manufacturing operations. announcing
`plans to close two additional manufacturing
`sites and the sale of a third. We. have announced
`cuts in our European sales force, subject to
`local laws and consultations with works councils
`
`as appropriate. In R&D, we have announced
`that we expect to close live research facilities.
`also subject to local laws and consultations with
`works councils as appropriate, and to locate our
`scientists into fewer but better utilized sites.
`
`Overall, we will eliminate about 10,000 positions
`
`(or about 16 percent) of Pfizer". total workforce
`by the end of next year.
`
`Decisions to close sites and eliminate positions
`are difficult ones that we made only after
`very careful consideration of the alternatives.
`We are working to mitigate the effects of these
`decisions on our colleagues. their families and
`their communities. But we’re taking these
`actions now to make sure thatl’fizer becomes
`
`a stronger, more efficient". company as well as
`one that is fully able to fund the many
`opportunities in our early- and mitlrstage pipeline
`and in eXternally sourced products.
`OUR THIRD PRIORI‘TY is to foster clearer
`accountability, faster decision-making, and
`increased agility in our organization. To that
`end= we have restructured our US. commercial
`operations into four Therapeutic Area units,
`and a fifth unit focused on customer support
`and shared services. Similarly, we have
`dramatically simplified the R&D organization
`to improve.productivity and give our discovery
`and development teams more focus, increased
`flexibility. and clearer goals in their work
`advancing biomedical science.
`The leaders of these smaller business units,
`in both our commercial operations and in
`R&D, are experts in their areas of responsibility.
`We are encouraging them to build strong
`relationships with important collaborators and
`_ influential opinion leaders in their areas.
`OUR FOURTH PRIORITY is to open new
`channels of communication with patients,
`doctors. government and commercial payers,
`and other key stakeholders. We will listen better
`
`
`
`.-
`...
`I.I.I
`I.I
`— --
`—-I -.
`I-
`.I.
`--
`.I.
`-
`-— u
`-
`. --
`--
`III
`I
`.-
`I
`I
`-
`—I...I"-.
`.I
`'I
`- - — -I.I
`I III'h-l—III'I-
`- -
`+ 1H-
`..I-.I- +1- 1 -III-.- h—l—JI -l--.
`'- — I'l-
`-
`-l-
`I
`r
`-I-
`-'- 'I' -I|I--I HI— — III-ll- -I-"-ll-
`'I-
`-I—
`- +I- h-I-HII- +-II|-fl-I-I- Hall-i I——IH—I-I-|Ih-II
`-l
`..
`.
`... -.. .. ....“ _. -.- _
`I
`I
`- 1.5...
`- _
`II
`-
`||.|
`--
`II- -
`'-|-
`-
`r
`I-
`
`I
`
`I
`
`.-I.
`
`II.
`
`-
`
`I.
`
`--
`_
`1
`
`I--
`
`.I
`
`-
`
`I
`
`
`--
`r
`-I-I
`
`-
`
`I
`
`.
`
`I
`
`.1.
`.
`--
`-I .I . _ |—IH-
`I
`I...
`II— .. u.
`.I
`I
`..I
`I-.-
`.. ..... I.
`-u—-
`--'I
`II
`l‘l'llr
`-I II -II -. -
`- 'III a-
`HI]
`—
`'I-I-I-l-I-l-
`'I'HI-
`l-II -l'I-—-I-
`--|-II !-
`"II'II—I
`II- *— ---- I-I-
`l-Iu-fl-I-I- III-H I
`I'-
`_. 1...... I..I
`_ I
`.. .I
`.... a........-I.I.....
`-r
`-
`II
`II
`- I _ '-.
`.I-
`
`I.-I.
`I
`
`.
`
`..I.
`
`u
`
`II.
`
`-
`'I'I
`.-I
`
`I.
`
`WATSON LABORATORIES, mc. ,Ex. 1 126, p. 7 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 7 of 44
`
`

`

`to these crucial constituencies and will work
`
`harder to meet their needs. In many parts of
`the world, the government is virtually the only
`purchaser of healthcare. and customers like these
`need a clear case for the value of our medicines.
`
`For example, we will invite payers to look
`at our medicines earlier in their development,
`so they can help us design clinical programs
`which demonstrate their value. We are also
`
`stepping up our collaborations with academic
`and other research institutions. Our recently
`announced alliance with Scripps, described later
`in this report, is one example of this kind of
`collaboration. We will be a constructive voice in
`
`engaging all stakeholders on healthcare policy
`and the regulation of our medicines, and we
`will actively participate in the debate over how
`to improve the quality of liealthcare on behalf
`of patients.
`Finally, l deeply believe that our strongest
`competitive advantage is our peoplemexperienced,
`skilled and committed to our success and to
`
`the well—being of patients. OUR FIFTH PRIORITY
`is to make Pfizer a great place to work.
`By eliminating bureaucracy, reducing layers
`of management, and giving colleagues both more
`freedom to make decisions, as well as clearer
`accountability, we can create an environment that
`encourages ideas, welcomes a diversity of views,
`recognizes outstanding effort and rewards
`exceptional accomplishments.
`
`We are also building a more perforinancerbased
`culture. We are reviewing our compensation
`programs to ensure that, at all levels of our
`organization, there is a strong link between how
`we pay people and how their achievements
`contribute to building total shareholder return.
`
`I believe that effective execution of these
`
`five. immediate priorities wiii position. Pfizer
`successfully to meet our challenges and
`seize our opportunitiesfiand, as a result. to
`increase shareholder value.
`
`And your management, starting with me, will
`be measured, compensated and held accountable
`for doing so.
`
`Pfizer is 158 years old in 2007. We have succeeded
`through the contributions of many, and l want
`to acknowledge two long-time leaders whose
`service to our company is ending with their
`retirements, as well as two Directors who are
`leaving our Board after many years of service.
`Hank McKinnell, formerly Chairman
`and CEO. retired from the Board of Directors
`
`in February. During his Stinyear Pfizer
`career in a series of senior leadership positions,
`Hank, first in partnership with his predecessor,
`Bill Steers, and then as CEO, was instrumental
`in taking the company to first place in the
`I
`industry, forging two landmark acquisitions and
`bringing a wide range of new medicines to
`patients. Hank also pioneered a number of
`
`
`
`
`
`
`
`
`
`I .u-. m“.
`-.
`+ n.— I......
`_.- .-
`ll - -ru .— I-u-I-u. -. mu I‘m-u... .- r --—|--- n...
`--..--.-
`I M.-
`....,..
`u m...
`-... 4-...-
`I'll-III
`d—I-l
`r -—-
`u-H
`-. u.
`-m -I-.I
`:- Irr-
`1-
`-.
`'-rI-rI--
`---
`Il-"1- 1....- -.-_.. -- - ..- .; n.-..._
`-+ u-I
`-.- -+ 'II-III-
`.n...,,
`-'I
`'II-
`a-—._...
`I
`-..—+.-.
`-|-.....-..
`.u.
`'—--
`III-n.
`_.u.
`I-u-r
`.-
`-
`.u -|-II+
`'I-IIIJ-II —
`H .I...
`--- '-I--— H—I-
`a-I-I-
`- --.|--.
`|—I-I----
`H -
`‘—"' -----
`'I'Hll-h-‘rm-h —IlI-'l-IIIi-III
`'
`"""""
`-
`-"|"""|—-'|'
`"
`""'-"-"""-""'|---'
`-.
`._- ...
`....... [1,... HP... H,_,....-
`I... 1...._
`hfl—dih-h-h -.-.—-I.1-..._ - "-...-I- nu-..
`"
`-.-
`I
`-
`.
`- —u—--
`u rI'I-I- - -.-.-|-
`-.-
`.. 4.— -I i-q. m...
`u - ml
`--. _n— ..... I
`
`_.m
`.-
`
`.
`
`.
`
`1 .-- _
`I"...
`.
`
`.
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. a of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 8 of 44
`
`

`

`
`
`public-private partnerships that have been
`highly effective in treating and preventing
`infectious diseases.
`
`Karen Katen, formerly Vice Chairman and
`IE’.rcsidcnt of l.’iizcr Human Health= will retire
`from the company in March. She, too= spent her
`entire :areer with Pile-er and played a critical
`role in the growth ofour pharmaceuticals
`business= now the world’s largest. She has been
`a tireless voice for patients, and all of us deeply
`appreciate her many contributions to Pfizer’s
`growth and success over more than three decades.
`Stan ikenherr}r will. retire in March from
`Pfizer’s Board of Directors. Stan joined the Board
`in 1982, and for the next 25 years he served our
`company with distinction, always providing wise
`counsel with the highest degree of integrity and
`an abiding commitment. to the best interests of
`.E’fizer. In 2005, his fellow directors recognized
`his leadership by asking him to serve as the
`Boards first Lead Independent Director. a role he
`executed with enthusiasm and excelience. Stan
`
`retires from Pfizer’s Board with our gratitude and
`respect, and with our beet wishes for the future.
`Constance Homer. who has served on Pfizer’s
`Board since 19533= has been elected Pfizer’s
`new Lead Independent Director and will do an
`outstanding job in that important role.
`l also went to thank Ruth Simmons, who has
`been on our Board since 1997. Ruth has informed
`us that she will not stand for re-electien to the
`
`Board, so that she can devote more time to her
`work as President of Brown University. Ruth
`has served on a number of Board Committees,
`including the Governance Committee, and we
`deeply appreciate her dedicated service.
`
`We look. to the future with confidemm and
`
`optimism. I am honored to have the opportunity
`to lead. li’i‘izer during this critics? time, and
`I appreciate the support I have received from our
`shareholders, colleagues and business partners.
`What excites and n'iotivates me and so
`
`mandr others at our company, is Ilie prospect
`vs
`of" [I ”one fermion Pfizer into
`a (momma? that
`consistently delivers on its promise to provide
`the value our customers need, the working
`environment our colleagues want, and the
`results that you~our owne'rsn—ndescrve.
`
`Sincere-l):
`
`Air/612%— ‘
`
`Jeff Kindler
`Chairman of the Board
`
`and Chief Executive Officer
`February 22, 2007
`
`
`
`I-I'
`III-III-
`l---I-I--
`'H-fl-III 'I-‘FII- I'l- iI-II—II-II‘ III- -I-.|- I- 'I-II-u.
`III
`I. III
`..I. —_.
`I
`I1-
`iIII. --I-.
`I u ..I. I1.u.|l|
`'-.
`II
`.I
`-'
`.
`I.I
`III
`— |"u-fl
`+
`_.....
`......I_
`l...‘ n1-..- ..
`.II
`"1-
`In
`'l"_ —-'--II
`“wk—- #IHifl—H -'
`rr-
`‘
`|-- 1-
`'I—-—-— J'-
`'--I-
`l"
`----- —I — -
`Ir-I-I- I—--I I— II|I -I-
`'IHI '- II'II-l-
`'I-l
`II'I'
`I
`‘I- H |.
`-I-I-III-
`'II
`
`— '-
`
`III-
`
`-
`
`'1
`
`lIrIII-r
`|II-I---I-IIIII-
`Il'.
`.
`.-I
`.
`h 1. II
`1'-
`II
`
`I
`ll.
`
`I
`
`II
`u-
`III— I- r-
`
`I
`
`-I-
`
`II
`
`I
`
`I...
`
`I.
`I
`
`-.—.
`
`.
`
`I
`
`.I
`
`'II
`III
`
`III..
`I
`-I...qu.
`II
`
`-
`
`II.
`
`I
`
`I
`
`In”
`II.
`-'I
`J_”_._ - + I
`I
`-||-
`I——
`.— ...
`.. -...
`II.
`
`-
`
`I
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 9 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 9 of 44
`
`

`

`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 10 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 10 of 44
`
`

`

`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 11 of 44
`
`

`

`
`
`maximizing
`
`To maximize revenues from our current
`
`_ and planned products, we are reorganizing
`and refocusing our R&D and commercial
`
`operations to provide a common View
`
`for all the medicines aimed at a major area of
`medical need. Our 3&1) pipeline, the largest
`in Pfizer’s history includes promising new
`therapies for Alzheimer’s disease, cancer,
`diabetes, HIV, obesity and other unmet
`I
`'
`medical needs.
`
`10
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 12 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 12 of 44
`
`

`

`
`
`lid‘izer today offers a broad portfolio
`of products, including liipitor, the world’s
`best—selling medicine. But our approach
`
`to disc0vering, developing and marketing
`these medicines is changing just as fast
`as our external environment. Today, the
`market for even a highly—successful
`medicine with significant remaining
`patent life can change dramatically, even
`overnight. New competitive entries join
`the. field, generic firms mount patent
`
`challenges, payers change the rules for
`reimbursement, or the results of a study
`offer expanded opportunity—- the effects
`of these and many other events in a
`
`medicine’s life cycle demand both a
`larger view of strategy and the ability to
`change tactics at a moment’s notice.
`
`We’re meeting this challenge through
`the Therapeutic Area Model, whiCh
`provides a single, shared View of the
`current and future environment for all
`the medicines aimed at a family of
`
`patient needs. Both. Pfizer’s commercial.
`operations and our R&D groups are
`now aligned around nine Therapeutic
`
`Areas, all representing large areas.
`of unmet medical need. The leaders
`
`in each Therapeutic Area have the
`resources needed to plan for, develop,
`launch and manage medicines that
`patients want, physicians Will prescribe,
`
`and payers Will pay for. Through our
`Therapeutic Area teams, we now have a
`
`seamless continuum of focused product
`management that starts with the
`
`earliest stages of discovery and extends
`through the late stages of a medicine’s
`
`commercial life. Besides providing a
`new level of discipline to our investment
`decisions, the Therapeutic Area approach
`helps us allocate resources across the
`
`entire range of our present and potential.
`product offerings, coaxing the maximum
`
`amount of revenue growth out of each
`dollar invested.
`
`'
`
`
`
`'J: I...|.|nl.t
`
`
`
`
`MARIE-CAROLINE SAINPY
`Senior Vice President.
`Customer Business Unit and
`Comma:
`”11 Operations
`
`
`
`WATSON LABORATORIES, mc. ,Ex. 1126, p. 13 of 44
`
`11
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 13 of 44
`
`

`

`
`
`TAw
`
`£.m.F.RmmAI—N
`
`m
`
`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 14 of 44
`
`

`

`
`
`
`WATON LABORATORIES, INc. ,Ex. 1162, p. 15 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 15 of 44
`
`

`

`
`
`
`
`3: mt;
`
`' ”are, fidiv-ibdusing'
`_
`. s, but also on how these '
`' y» _]'l_an ipsychotm
`not. only 011. h'
`Jemima helps-doctqrs trefit mental ‘-
`‘
`_ di
`tip
`gaff
`'1391; at'mts’ m'eta 30-1
`nd; 'G eodon is woven {Q show improvem‘ Linté in
`metabolic pa ‘améters adversely impacted by
`weight. gain, triglycm‘ides and total dude
`and safety, Gende‘n’s superior metailolic pro
`growing mefiicines in Pfizer’s Dnrifoiio.
`
`'
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 16 of 44
`
`

`

`
`
`LYRICA
`
`A leading treatment
`for nerve pain
`
`
`
`Coraiie Raunig, Williamsburg, Virginia
`
`"The pain felt like touching a hot stove 'qn
`
`pull away. Without Lyrica, Iwouldjus
`
`I’m back to skating two or three morrjai.
`
`
`
`lyrica leads in treating two of' the m0 4
`-
`,
`I]; ve pain, diabetic
`peripheral neuropathy and IJOStilIGI‘pE‘
`_
`‘gxfiest Pfizer medicine
`
`{.0 surpass $1 billion in sales worldwide. .‘.
`la nah, more than
`
`4 million patients wmfidwidc have b(
`
`favorable safety profile. l’fizvr has {3
`education tools to help doctrirs and patient
`
`
`a misdiagnosed and poorly-Lunderstood culidi on; affecting an (3
`{ed 14 million
`ie' must-ant
`‘
`'
`
`people worldwide, This disease. whichJiS oftéi‘i clébilitating, prod
`.ceptzed treatmg‘m
`i) '
`. 1mm sleep quaiié.y.':lnd fittigua Currently: a w; '
`'
`
`lizia
`
`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 17 of 44
`
`

`

`
`
`
`
`
`
`
`
`4- .-':
`
`WATSON LABORATORIES, IN
`
`c. ,E.x1126 p. 18 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 18 of 44
`
`

`

`
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 19 of 44
`
`

`

`KEY HUMAN HEALTH MEDICINES
`
`,Ltiitlttlttt’,‘
`Lipitor is the most prescribed treatment to reduce elevated LDL
`cholesterol and triglycerides. It is approved in the U.S., Europe and
`a number of other countries for prevention of cardiovascular disease,
`inciudt'ng reducing the risk of a heart attack. stroke, revascularizations
`and angina in patients with multiple risk factors for coronary heart
`disease. It remains the best-selling medicine of any kind in the world.
`
`After ‘16 years in the marketplace helping patients who suffer from
`hypertension and angina, Norvasc remains the world‘s most prescribed
`
`branded medicinetortreating these cardIovascular condItIons
`$4951LLSON +3-916-
`,
`
`Zoloft
`Zoloft is approved for six mood and anxiety disorders, the broadest
`range of such disorders of any antidepressant. It is the only approved
`medicine for the long-term treatment of post-traumatic stress disorder
`and sociai anxiety disorder. Pfizer lcst exclusivity in the U.S. for Zoloft
`
`in June 2066. Zoloft IiaunchedIn .‘EPQZP'In July 2006 asJ Zoloft.
`
`
`Celebrex
`With its December 2006 FDA approvat for juvenile rheumatoid arthritis,
`Celebrex is now approved for seven different indications, including
`osteoarthritis. adult rheumatoid arthritis, acute pain, menstrual pain,
`tamilial adenomatous polyposis and ankylosing spondylitis. Celebrex
`
`is one of the most studied arthritis medicines on the market“
`
`
`
`One of the world's leading pharmaceutical brands, Viagra continues
`to lead the erectile dysfunction market around the world. Pfizer is
`supporting consumer education about this important condition with
`new branded and unbranded educational campaigns in.the U.S.“
`
`
`
`The most~prescribed antihistamine in the U.S.. Zyrtec provides strong,
`rapid and long—lasting relief for seasonal and year-round allergies
`with once—daily dosing. Zyrtec is marketed in the US. in conjunction
`with its discoverer, UCB SA.
`$1.6 BILLioN +15%
`
`A u
`
`Xalatan/Xalacom
`xalatan'Isthe worldsleading treatmentforglaucoma,the second
`ieading cause of blindness'In the world. Xalacom {a combination
`of Xalatan and the betawblccker timolol) otters a single daily dose that
`provides incremental efficacy for patients with insufficient response
`to treatment with one agent.
`
`
`A powerful new option for treating neuropathic pain and epilepsy, Lyrica
`is now approved in 77 countries and available in 59 markets. More than
`4 million patients worldwide have been treated with Lyrics. It is the first
`and only medicine in the EU licensed for both peripheral and central
`neuropathic pain, two tough-to-treat pain conditions.
`
`
`
`Detrol is the world’s leading prescription medicine for overactive
`bladder, a condition that affects up to 100 million people around the
`world. Detrol LA. the once-daily, extended—release formulation,
`has become the standard of care for this condition, with 13 miiiion
`patients treated worldwide.
`
`
`
`Camptosar is a foundation treatment for metastatic colorectal cancer.
`The National Comprehensive Cancer Network. an aliiance of 20 of the
`world’s leading cancer centers. has issued guidelines recommending
`Gamptosar as an option across all lines of treatment for advanced
`colorectal cancer.
`
`Genotropin is the world's leading human recombinant growth hormone,
`accounting for about one»third of the total market. Its ieadership reflects
`two decades of scientific studies on product safety investment in drug
`
`and delivery——devt’ce. tnnovatlon and attention to patient care.
`
`
`
`Zyvox
`ZyvoxIs the worlds bestnselllng branded medicine for”serious
`gram-positive infections'In adults and children— which increasingty are
`caused by drug—resistant bacteria in hospitals and, more recently, in the
`community setténg. Zyvox offers unmatched dosing flexibility with
`intravenous, tablet and oratsuspenSIon formulations
`5732‘ MILLION +27%
`
`Geodon/Zeldox
`GeodonIs anatypical antlpsychotlc medIcIne that offers dosing
`flexibility, proven efficacy and afavorable metabolic profile.
`Also marketed under the trademark Zeldox, Geodon is available in
`more than 85 markets. It became the fastest growing atypical
`
`
`antipsychotic i
`S market in 2006
`
`
`18
`
`WATSON LABORATORIES, INc. ,Ex. 1126, p. 20 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 20 of 44
`
`

`

`
`
`ernd is a broad-spectrum antifungal medicine for serious systemic
`fungal infections that are most common in leukemia and bone marrow
`
`Revatio
`Revatio treats pulmonary arterial hypertension. a rare but devastating
`disorder. Flevatio was the first oral treatment to be approved by the FDA
`
`for patients with an early stage-ofthis progressive disease.
`transplant patients. It can be administered orally or intravenously.
`
`
`Caduet
`OadLiet a combination therapy ofLipitorand nlorvasc, treats two
`of the most common risk factors for cardiovascular disease—
`hlgh cholesterol and hypertension— with one pill. making it a powerful
`
`cardiovascular treatment option
`sawwLLION +99%.i.................IIII.7122:2:11:21:IIIIIIIIIIIZZIKI
`
`Artcept
`The top—selling medicine in the Alzheimer's disease market, Aricept's
`success has been built on a large body of ctinicat evidence supporting
`its efficacy and toierabitity. With its October 2005 FDA approval for
`severe Alzheimer’s disease, Aricept is now the only medicine approved
`in the U.S. to treat all degrees of severity for this condition. Pfizer Go-
`
`promotes Aricept with its discoverer and developer Eisai Co. Ltd.
`
`Zmax
`LaunchedIn2005 Zinax {aZIthromyctn extended release} the first
`single--dose oral antibiotic for adults, uses innovative microsphere
`technology to deliver a complete course of therapy in a single two-gram
`dose. A single——dose treatment for bacterial infections improves
`
`compliance and minimizes the threat of emerging antibiotic. resistance.
`
`
`
`Exubera, one of the most significant innovations'In insulin delivery
`in more than 30 years. represents a medical advance that offers diabetic
`patients a novel method of introducing insulin into their systems—
`through the lungs. Long—term efficacy and safety data in both type 1
`and type 2 diabetes support Exubera as a valuable new option that
`delivers effective blood-glucose control and potentially reduces the
`debilitating and costly complications associated with this disease.
`
`Eraxis
`
`Eraxis builds upon Pfizer5 historical strengthInthe treatment
`of infectious diseases, particularly antifungal treatments. and offers
`a new treatment option for serious systemic candida infections. It was
`approved by th FDA in Februa
`2006.
`
`
`
`Rebif is a biologic product (interferon beta-1 a) used in the treatment
`of relapsing forms of multiple sclerosis. lt offers patients proven
`efficacy to delay disability, with a welt-established safety and tolerability
`profile. Pfizer co-promotes Rebif in the U.S. with its discoverer,
`EMD Serene, lnc., which reports its sales.
`
`
`
`Spirivatreats chronic obstructive pulmonary disease (COPD),
`a respiratory disorder that includes chronic bronchitis and emphysema.
`Available in more than 45 countries, Spiriva is now the most prescribed
`branded medication for COPD worldwide. Pfizer co-promotes Spiriva
`with Boehringe'r—lngelheim, which discovered and developed the
`medicine and reports its sales.
`
`Aromasin
`
`Aromasm an aromatase tt‘lhlbltor has been shownto reduce the risk
`of breast cancer recurrence by 31 percent for postmenopausal patients
`switching to it after two to three years of tamoxifen therapy versus
`continuing on tamoxifen.
`
`
`Relpax
`Clinical data for Helpax establishes its beneiitsforearlyand
`sustained relief from migraine pain and symptoms. Itis marketed
`
`in more than 28 count 'es.
`
`
`
`Sutent is a breakthrough cancer treatment for two hard-tc-treat
`types of cancer, metastatic renal cell carcinoma and imatinib-resistant
`or intolerant gastrointestinal stromal tumor. Sutent was approved in
`the US. in January 2006 and in the EU in July 2006 and has received
`earlier—than-anticipated approvals in several other countries in Asia
`and Latin America. In January 2007 the EU granted futl marketing
`authorization and extension of indication to first-line treatment of
`
`advanced and]
`tastatic ren |
`ell carcinoma.
`
`
`
`Chantix”is abreakthrough smoking cessation therapy that was
`approved by the FDAIn May 2006. It was approved by the European
`Medicines Agency in September 2006 and will be marketed outside
`the US. under the brand name Champix. Chantix is offered with a
`state-of-the~art patient support program that is personalized to help
`
`smokers quit.
`
`
`' Reflects direct sales under license agreement with Eisai Co, Ltd. only.
`
`10
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 21 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 21 of 44
`
`

`

`
`
`
`
`Resurgence in R&D
`
`Pfizer is changing how we work in
`biomedical R&D to streamline and
`
`improve productivity. Our R851) pipeline
`is new the largest in Pfizer’s history and
`is primed to deliver four new medicines
`a year, starting in 2011. Longer term,
`Elfizer’s werld~class science ma kes as the
`
`preeminent leader in a number of new
`scientific platforms, such as tyrosine
`kinase inhibition and DNA-based
`
`vaccines that hold tremendous promise
`
`in changing the way diseases are
`treated ——‘and prevented.
`
`NEUROSCIENCE
`OPHTHALMOLOGY
`
`
`
`
`CARDIOVASCULAR.
`METABOLIC 8‘
`ENDOCRINE
`ALLERGY 8-
`ESFIRATORY
`GASTROINTESTINAL
`GENITOURINARY
`
`‘ a’
`
`
`INFECTIOUS
`DESEASES
`
`ONCOLOGY
`.
`
`PAIN
`
`lNFLAMMATION
`
`DERMATOLOGY
`
`
`
`G DISCOVERY I DEVELOPMENT fALLlANCE
`0 DEVELOPMENT iALLIANCE
`
`- Pfizer focuses its discovery,
`development and alliance efforts on
`Therapeutic Areas representing huge
`unmet medical needs, with annual
`markets estimated in excess of
`$300 billion.
`
`
`
`
`
`
`As of January 2007
`
`For more details about Pfizer's pipeline, go to WW\v.pfizer.cnmlpipclinc.
`
`20
`
`WATSON LABORATORIES, mc. ,Ex. 1126, p. 22 of 44
`
`WATSON LABORATORIES, INC. ,Ex. 1126, p. 22 of 44
`
`

`

`More medicines, more quickly
`
`DISCOVERY 8; DEVELOPMENT AREAS
`
`
`
`3:1:sz opportunity for .lE’fizer. We
`is a time of
`'l‘l‘
`have a growing pipeline that is particularly strong in
`Phases l and ll. We are advancing in biologicals ancl
`vaccines. There is tremendous potential in forging
`new collaborations with scientists around the world.
`
`To fund these opportunities and deliver on our goal
`of four new medicines a year from internal R811) by
`20'] i, we are transforming how we discover, develop
`and commercialize our products, as well as how we
`form new alliances and find products and services to
`license. We’re creating