PFIZER INC (Form: 10-Q, Received: 05/07/2004 15:41:32)

FORM 10-Q

For the Quarter Ended
March 28, 2004

Table of Contents

PART I. FINANCIAL INFORMATION	Page

Item 1.

Financial Statements:

Condensed Consolidated Statement of Income for the three months ended March 28, 2004 and March 30, 2003	3

Condensed Consolidated Balance Sheet at March 28, 2004 and December 31, 2003	4

Condensed Consolidated Statement of Cash Flows for the three months ended March 28, 2004 and March 30, 2003	5

Notes to Condensed Consolidated Financial Statements	6

Independent Accountants' Review Report	17

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations	18

Item 4.

Disclosure Controls and Procedures	39

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings	40

Item 2.

Changes in Securities, Use of Proceeds and Issuer	42
Purchases of Equity Securities

Item 4.
Submission of Matters to a Vote of Security Holders	42

Item 6.

Exhibits and Reports on Form 8-K	44

Signature	45

Certifications	48

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PFIZER INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)

		Three Months Ended
(millions of dollars, except per common share data)		March 28, 2004		March 30, 2003

Revenues	$	12,487	$	8,506

Costs and expenses:
Cost of sales		1,794		1,058
Selling, informational and administrative expenses		3,933		2,740
Research and development expenses		1,649		1,218
Merger-related in-process research and development charges		955		--
Merger-related costs		247		91
Other (income)/deductions-net		780		183

Income from continuing operations before provision for taxes on income, minority interests and cumulative effect of change in accounting principles		3,129		3,216

Provision for taxes on income		809		761

Minority interests		2		--

Income from continuing operations before cumulative effect of change in accounting principles		2,318		2,455

Discontinued operations:
Income from operations of discontinued businesses and product lines-net of tax		13		38
Gains on sales of discontinued businesses and product lines-net of tax		--		2,202

Discontinued operations-net of tax		13		2,240

Income before cumulative effect of change in accounting principles		2,331		4,695

Cumulative effect of change in accounting principles-net of tax		--		(30)

Net income	$	2,331	$	4,665

Earnings per common share - Basic:
Income from continuing operations before cumulative effect of change in accounting principles	$	.31	$	.40
Discontinued operations:
Income from operations of discontinued businesses and product lines-net of tax		--		--
Gains on sales of discontinued businesses and product lines-net of tax		--		.36
Discontinued operations-net of tax		--		.36
Income before cumulative effect of change in accounting principles		.31		.76
Cumulative effect of change in accounting principles-net of tax		--		--
Net income	$	.31	$	.76

Earnings per common share - Diluted:
Income from continuing operations before cumulative effect of change in accounting principles	$	.30	$	.40
Discontinued operations:
Income from operations of discontinued businesses and product lines-net of tax		--		--
Gains on sales of discontinued businesses and product lines-net of tax		--		.36
Discontinued operations-net of tax		--		.36
Income before cumulative effect of change in accounting principles		.30		.76
Cumulative effect of change in accounting principles-net of tax		--		--
Net income	$	.30	$	.76

Weighted average shares used to calculate earnings per common share:
Basic		7,586.4		6,101.4

Diluted		7,678.5		6,161.7

Cash dividends paid per common share	$	.17	$	.15

See accompanying Notes to Condensed Consolidated Financial Statements.

PFIZER INC. AND SUBISIDARY COMPANIES
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)

(millions of dollars)		March 28, 2004*		Dec. 31, 2003**
ASSETS
Current Assets
Cash and cash equivalents	$	965	$	1,520
Short-term investments		12,987		10,432
Accounts receivable, less allowance for doubtful accounts: $192 and $185		10,415		8,636
Short-term loans		448		391
Inventories		5,942		5,699
Prepaid expenses and taxes		3,052		2,758
Assets of discontinued businesses and product lines held for sale		1,580		1,241
Total current assets		35,389		30,677
Long-term investments and loans		5,430		6,142
Property, plant and equipment, less accumulated depreciation: $7,366 and $6,916		17,703		18,156
Goodwill		24,264		22,265
Identifiable intangible assets, net		35,190		35,591
Other assets, deferred taxes and deferred charges		4,313		3,944
Total assets	$	122,289	$	116,775

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term borrowings, including current portion of long-term debt: $932 and $726	$	10,692	$	8,818
Accounts payable		2,479		2,587
Dividends payable		3		1,300
Income taxes payable		1,948		1,910
Accrued compensation and related items		1,636		1,740
Accrued litigation settlements		714		1,402
Other current liabilities		6,857		5,850
Liabilities of discontinued businesses and product lines held for sale		308		302
Total current liabilities		24,637		23,909
Long-term debt		7,144		5,755
Pension benefit obligations		2,915		2,858
Postretirement benefit obligations		1,464		1,451
Deferred taxes		13,053		13,012
Other noncurrent liabilities		4,028		4,413
Total liabilities		53,241		51,398

Shareholders' Equity
Preferred stock		211		219
Common stock		436		435
Additional paid-in capital		66,767		66,396
Retained earnings		31,707		29,382
Accumulated other comprehensive expense		1,729		195
Employee benefit trust		(1,532)		(1,898)
Treasury stock, at cost		(30,270)		(29,352)

Total shareholders' equity		69,048		65,377
Total liabilities and shareholders' equity	$	122,289	$	116,775

* Unaudited.

** Condensed from audited financial statements.

See accompanying Notes to Condensed Financial Statements.

PFIZER INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Operating Activities:
Net income	$	2,331	$	4,665
Adjustments to reconcile net income to net cash provided by continuing operating activities:
Cumulative effect of change in accounting principles		--		30
Income from operations of discontinued businesses and product lines		(13)		(38)
Depreciation and amortization		1,261		269
Merger-related in-process research and development charges		955		--
Gains on sales of discontinued businesses and product lines		--		(3,746)
Gains on sales of products		--		(17)
Deferred income taxes		(284)		22
Other		174		177
Changes in assets and liabilities (net of businesses acquired and divested)		(2,841)		961

Net cash provided by continuing operating activities		1,583		2,323

Investing Activities:
Purchases of property, plant and equipment		(472)		(382)
Purchases of short-term investments		(4,603)		(5,295)
Proceeds from redemptions of short-term investments		2,613		2,727
Purchases of long-term investments		(453)		(356)
Proceeds from redemptions of long-term investments		816		182
Purchases of other assets		(153)		(158)
Proceeds from sales of other assets		109		80
Acquisition of businesses, net of cash acquired		(1,443)		--
Proceeds from the sales of businesses and product lines		--		1,178
Other investment activities		(135)		141

Net cash used in investing activities		(3,721)		(1,883)

Financing Activities:
Increase in short-term borrowings-net		1,776		919
Decrease in short-term borrowings-net		(106)		(89)
Proceeds from issuances of long-term debt		1,524		600
Principal payments on long-term debt		(3)		(256)
Proceeds from common stock issuances		17		15
Purchases of common stock		(912)		(598)
Cash dividends paid		(1,282)		(906)
Stock option transactions and other		569		63

Net cash provided by/(used in) financing activities		1,583		(252)
Net cash provided by discontinued operations		--		14
Effect of exchange-rate changes on cash and cash equivalents		--		(12)
Net increase/(decrease) in cash and cash equivalents		(555)		190
Cash and cash equivalents at beginning of period		1,520		1,878

Cash and cash equivalents at end of period	$	965	$	2,068

Supplemental Cash Flow Information:
Cash paid during the period for:
Income taxes	$	796	$	312
Interest		69		65

See accompanying Notes to Condensed Financial Statements.

PFIZER INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 1: Basis of Presentation

We prepared the condensed consolidated financial statements following the requirements of the Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America (GAAP) can be condensed or omitted. Balance sheet amounts and operating results for subsidiaries operating outside the U.S. are as of and for the three-month period ended February 22, 2004 and February 23, 2003. We have made certain reclassifications to the 2003 condensed consolidated financial statements to conform to the 2004 presentation. This includes the results of operations, the assets and liabilities held for sale and cash flows related to certain businesses and product lines reported as discontinued operations during the three months ended March 28, 2004 - See Note 12, "Discontinued Operations."

We are responsible for the unaudited financial statements included in this document. The financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of our financial position and operating results.

Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be representative of those for the full year.

The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in Pfizer's Annual Report on Form 10-K for the year ended December 31, 2003.

On April 16, 2003 we completed our acquisition of Pharmacia Corporation (Pharmacia) in a stock-for-stock transaction accounted for under the purchase method of accounting - See Note 3, "Pharmacia Acquisition." Starting with the date of acquisition, April 16, 2003, the Pharmacia assets acquired and liabilities assumed were recorded at their respective fair values and our results of operations include Pharmacia's product sales and expenses from the acquisition date. Therefore, our operating results for the first three months of 2004 reflect the impact of the acquisition of Pharmacia as compared to the first three months of 2003, which do not.

In accordance with Statement of Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation , we elected to account for our stock-based compensation under Accounting Principles Board Opinion (APB) No. 25, Accounting for Stock Issued to Employees . The exercise price of stock options granted equals the market price on the date of grant. There is no recorded expense related to grants of stock options.

The weighted-average fair value per stock option granted was $6.88 for the three months ended March 28, 2004, and $7.17 for the three months ended March 30, 2003. We estimated the fair values, as required under GAAP, using the Black-Scholes option-pricing model, modified for dividends and using the assumptions below. In the first quarter of 2004, we changed our method of estimating expected stock price volatility to reflect market-based inputs under emerging stock option valuation considerations. The Black-Scholes model is a trading option-pricing model that neither considers the non-traded nature of employee stock options, nor considers the restrictions on trading, the lack of transferability or the ability of employees to forfeit the options prior to expiry. If the model adequately permitted considerations of the unique characteristics of employee stock options, the resulting estimate of the fair value of the stock options could be different.

	Three Months Ended
	March 28, 2004	March 30, 2003

Expected dividend yield	2.90%	3.11%
Risk-free interest rate	3.32%	2.70%
Expected stock price volatility	22.15%	32.60%
Expected term until exercise (years)	5.75	5.50

The following table summarizes our results for the three months ended March 28, 2004 and March 30, 2003 as if we had recorded compensation expense for the options grants:

			Three Months Ended
(millions of dollars, except per common share data)			March 28, 2004		March 30, 2003

Net income available to common shareholders used in the calculation of basic earnings per common share:
As reported under GAAP*		$	2,330	$	4,665
Compensation expense			(126)		(112)
Pro forma		$	2,204	$	4,553

Basic earnings per common share:
As reported under GAAP*		$	.31	$	.76
Compensation expense			(.02)		(.01)
Pro forma		$	.29	$	.75

Net income available to common shareholders used in the calculation of diluted earnings per common share:
As reported under GAAP*		$	2,330	$	4,665
Compensation expense			(126)		(112)
Pro forma		$	2,204	$	4,553

Diluted earnings per common share:
As reported under GAAP*		$	.30	$	.76
Compensation expense			(.01)		(.02)
Pro forma		$	.29	$	.74

*	Includes stock-based compensation expense, net of related tax benefits, of $29.2 million for the three months ended March 28, 2004 and $8.7 million for the three months ended March 30, 2003.

For the three months ended March 28, 2004, net income available to common shareholders used in the calculation of basic earnings per common share represents net income reduced by preferred stock dividends-net of tax and net income available to common shareholders used in the calculation of diluted earnings per common share represents net income reduced by the incremental allocation of shares to the Employee Stock Ownership Plan (ESOP) acquired as part of the Pharmacia acquisition.

Note 2: Adoption of New Accounting Standards

On January 1, 2004, we adopted the provisions of FASB Interpretation No. 46R (FIN 46R), Consolidation of Variable Interest Entities. FIN 46R replaces the same titled FIN 46 that was issued in January 2003. FIN 46R identifies when entities must be consolidated with the financial statements of a company where the investors in an entity do not have the characteristics of a controlling financial interest or the entity does not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. The adoption of FIN 46R did not have a material impact on our consolidated financial statements.

Note 3: Pharmacia Acquisition

A. Description of Acquisition

On April 16, 2003, Pfizer acquired Pharmacia for a purchase price of $55,972 million, which included the issuance of approximately 1.8 billion shares of Pfizer common stock, 180 million options on Pfizer common stock, six thousand shares of Pfizer Series A convertible perpetual preferred stock (convertible into approximately 15.5 million shares of Pfizer common stock) and vested share awards, as well as transaction costs.

The acquisition has been accounted for as a purchase business combination. Under the purchase method of accounting, the assets acquired and liabilities assumed from Pharmacia are recorded at the date of acquisition, at their respective fair values. The consolidated financial statements and reported results of operations of Pfizer issued after completion of the acquisition reflect these values.

B. Allocation of Purchase Price

The purchase price has been allocated based on an estimate of the fair value of assets acquired and liabilities assumed.

(millions of dollars)

Book value of net assets acquired	$	8,795
Less: existing goodwill and other intangible assets		1,559
Tangible book value of net assets acquired		7,236
Remaining allocation:
Increase inventory to fair value		2,939
Increase long-term investments to fair value		40
Decrease property, plant and equipment to fair value		(288)
Record in-process research and development charge		5,052
Record identifiable intangible assets		37,066
Increase long-term debt to fair value		(370)
Increase benefit plan liabilities to fair value		(1,471)
Increase other net assets to fair value		(483)
Restructuring costs incurred through March 28, 2004		(2,685)
Tax adjustments		(13,293)
Goodwill		22,229
Purchase price	$	55,972

Since our interim allocation in the fourth quarter of 2003, our estimate has been revised for fixed assets ($727 million decrease). In addition, we recorded an additional $1,107 million in restructuring charges.

The more significant revisions to our estimates relating to our initial allocation of the purchase price in the second quarter of 2003 include inventory ($1,331 million increase), fixed assets ($1,099 million decrease) and identifiable intangible assets ($560 million increase). In addition, we recorded an additional $1,918 million in restructuring charges.

All of these revisions reflect our greater understanding of Pharmacia net assets since the acquisition date.

Note 4: Esperion Therapeutics, Inc.

On February 10, 2004, we completed the acquisition of Esperion Therapeutics, Inc. (Esperion), a biopharmaceutical company focused on the development of high-density-lipoprotein (HDL) cholesterol-targeted therapies for the treatment of cardiovascular disease, for $1.3 billion in cash (including transaction costs). The acquisition has been accounted for as a purchase business combination. The preliminary allocation of the purchase price includes in-process research and development of $920 million, which was expensed, and goodwill of $233 million, which has been allocated to our pharmaceutical segment and is not deductible for tax purposes. Esperion did not have any approved products.

Note 5: Merger-Related Costs

We incurred the following merger-related costs primarily in connection with our acquisition of Pharmacia which was completed on April 16, 2003:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Integration costs:
Pharmacia	$	101	$	80
Other		3		8
Restructuring costs:
Pharmacia		143		--
Other		--		3
Total merger-related costs - expensed	$	247	$	91
Total merger-related costs - capitalized	$	1,107	$	--

Integration costs represent external, incremental costs directly related to an acquisition, including expenditures for consulting and systems integration when incurred.

In connection with the acquisition of Pharmacia, Pfizer management approved plans throughout 2003 and during the first three months of 2004 to restructure the operations of both legacy Pfizer and legacy Pharmacia to eliminate duplicative facilities and reduce costs. The restructuring of our operations as a result of our acquisition of Pharmacia is expected to continue through 2005 and include severance, costs of vacating duplicative facilities and contract termination and other exit costs. Total merger-related expenditures incurred during 2003-2005 are expected to be about $6.0 billion, on a pre-tax basis.

Restructuring Costs Associated with Legacy Pfizer - Expensed

We have recorded restructuring costs associated with exiting certain activities of legacy Pfizer, including severance, costs of vacating duplicative facilities and contract termination and other costs. These costs have been recorded as a charge to the results of operations and are included in Merger-related costs. The components of the restructuring charges associated with the acquisition of Pharmacia, which were expensed, follow:

		Provisions
(millions of dollars)		Year 2003		Three Months Ended March 28, 2004		Total		Utilization Through March 28, 2004		Reserve* March 28, 2004

Employee termination costs	$	140	$	92	$	232	$	110	$	122
Asset impairments		21		42		63		63		--
Other		16		9		25		13		12
	$	177	$	143	$	320	$	186	$	134

*Included in Other current liabilities.

Through March 28, 2004, the employee termination costs represent the approved reduction of the legacy Pfizer work force by 2,091 people, mainly in corporate, manufacturing, distribution, sales and research. We notified affected individuals and as of March 28, 2004, 1,452 employees were terminated. Asset impairments primarily include charges to writedown property, plant and equipment. Other primarily includes costs to exit certain activities of legacy Pfizer.

Restructuring Costs Associated with Legacy Pharmacia - Capitalized

We have recorded $2,685 million of restructuring costs associated with employee terminations and exiting certain activities of legacy Pharmacia. These costs are recognized as liabilities assumed in the purchase business combination. Accordingly, the restructuring charges incurred in the first year after the acquisition are considered part of the purchase price of Pharmacia and have been recorded as an increase to goodwill. These restructuring costs also include costs associated with relocation. Future restructuring charges associated with legacy Pharmacia will be charged to the results of operations. The components of the restructuring costs capitalized as a cost of the acquisition of Pharmacia follow:

		Costs Incurred
(millions of dollars)		Year 2003		Three Months Ended March 28, 2004		Total		Utilization Through March 28, 2004		Reserve* March 28, 2004

Employee termination costs	$	1,289	$	263	$	1,552	$	1,315	$	237
Other		289		844		1,133		161		972
	$	1,578	$	1,107	$	2,685	$	1,476	$	1,209

* Included in Other current liabilities.

Through March 28, 2004, the employee termination costs represent the approved reduction of the legacy Pharmacia work force by 13,045 people, mainly in corporate, manufacturing, distribution, sales and research. We notified affected individuals and as of March 28, 2004, 11,596 employees were terminated. Employee termination costs include accrued severance benefits and costs associated with change-in-control provisions of certain Pharmacia employment contracts. Other includes costs to exit certain activities of legacy Pharmacia.

Note 6: Inventories

The components of inventories follow:

(millions of dollars)		March 28, 2004		Dec. 31, 2003

Finished goods	$	2,341	$	2,198
Work-in-process		2,445		2,204
Raw materials and supplies		1,156		1,297
Total inventories	$	5,942	$	5,699

Note 7: Goodwill and Other Intangible Assets

A. Goodwill

The changes in the carrying amount of goodwill for the three months ended March 28, 2004, by segment, follow:

(millions of dollars)		Pharmaceutical		Consumer Healthcare		Animal Health		Other		Total

Balance, December 31, 2003	$	19,487	$	2,615	$	78	$	85	$	22,265
Pharmacia goodwill adjustments		1,642		155		(14)		(1)		1,782
Other*		232		30		29		(74)		217
Balance, March 28, 2004	$	21,361	$	2,800	$	93	$	10	$	24,264

*Includes additions from acquisitions (primarily Esperion), reclassifications to Assets of discontinued businesses and product lines held for sale and the impact of foreign exchange.

B. Intangibles

The components of identifiable intangible assets follow:

		Gross Carrying Amount				Accumulated Amortization
(millions of dollars)		March 28, 2004		Dec. 31, 2003		March 28, 2004		Dec. 31, 2003

Amortized intangible assets:
Developed technology rights	$	32,052	$	31,566	$	(3,186)	$	(2,364)
Trademarks		111		107		(71)		(68)
Other		575		583		(178)		(186)
Total amortized intangible assets		32,738		32,256		(3,435)		(2,618)
Unamortized identifiable intangible assets:
Brands		5,238		5,305		--		--
Trademarks		267		266		--		--
Other		382		382		--		--
Total unamortized intangible assets		5,887		5,953		--		--
Total identifiable intangible assets	$	38,625	$	38,209	$	(3,435)	$	(2,618)

Total amortization expense for finite-lived intangible assets was $843 million for the three months ended March 28, 2004 and is primarily included in Other (income)/deductions-net.

The annual amortization expense expected for the years 2004 through 2009 is as follows:

	(in millions of dollars)
2004	$	3,337
2005		3,334
2006		3,228
2007		3,077
2008		2,563
2009		2,353

Note 8: Financial Instruments

A. Long-Term Debt

In February 2004, we issued:

-	$750 million senior unsecured notes, due February 2014, which pay interest semi-annually, beginning on August 15, 2004, at a rate of 4.5%; and

-	$700 million senior unsecured notes, due March 2007, which pay interest semi-annually, beginning on September 15, 2004, at a rate of 2.5%.

The notes were issued under a $5 billion debt shelf registration statement filed with the SEC in November 2002.

B. Derivative Financial Instruments and Hedging Activities

During the first three months ended March 28, 2004, we entered into the following new interest rate derivatives:

Financial Instrument		Hedge Type	Hedged or Offset Item	Notional Amount (millions of dollars)	Maturity Date

Swaps		Fair value	U.S. dollar fixed rate debt ⁽¹⁾	$750	2014
Swaps		Fair value	U.S. dollar fixed rate debt ⁽¹⁾	700	2007

⁽¹⁾	Serves to reduce exposure to long-term U.S. dollar interest rates by effectively converting fixed rates associated with long-term debt obligations to floating rates.

There was no material ineffectiveness in any hedging relationship reported in earnings in the first three months of 2004.

Note 9: Benefit Plans

Components of Net Periodic Benefit Costs

The components of net periodic benefit cost of the U.S. and international pension plans and the postretirement plans for the three months ended March 28, 2004 and March 30, 2003 follow:

		Pension Plans
		U.S. Qualified				U.S. Supplemental (non-qualified)				International				Postretirement Plans
(millions of dollars)		2004		2003		2004		2003		2004		2003		2004		2003

Service cost	$	71	$	46	$	8	$	7	$	68	$	41	$	10	$	5
Interest cost		97		67		15		13		71		40		31		15
Expected return on plan assets		(143)		(75)		--		--		(71)		(41)		(5)		--
Amortization of:
Prior service costs		4		4		--		--		5		2		--		3
Net transition asset		--		--		--		--		2		--		--		--
Actuarial (gains)/losses		26		29		9		8		13		9		6		5
Curtailments and settlements-net		--		1		--		1		(1)		2		--		1
Net periodic benefit costs	$	55	$	72	$	32	$	29	$	87	$	53	$	42	$	29

Note 10: Comprehensive Income

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Net income	$	2,331	$	4,665
Other comprehensive income/(expense):
Holding gain/(loss) on investment securities arising during period-net of tax		148		(26)
Currency translation adjustment and hedges		1,386		659
Total other comprehensive income/(expense)		1,534		633
Total comprehensive income	$	3,865	$	5,298

The change in currency translation adjustment and hedges included in Accumulated other comprehensive expense for the first three months of 2004 was:

(millions of dollars)		2004

Opening balance	$	632
Translation adjustment and hedges		1,386
Ending balance	$	2,018

Note 11: Earnings Per Common Share

Basic and diluted earnings per common share (EPS) were computed using the following common share data:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

EPS Numerator - Basic:
Income from continuing operations before cumulative effect of change in accounting principles	$	2,318	$	2,455

Less: Preferred stock dividends - net of tax		1		--

Income available to common shareholders from continuing operations before cumulative effect of change in accounting principles		2,317		2,455

Discontinued operations:
Income from operations of discontinued businesses and product lines-net of tax		13		38
Gains on sales of discontinued businesses and product lines-net of tax		--		2,202

Discontinued operations-net of tax		13		2,240

Income available to common shareholders before cumulative effect of change in accounting principles		2,330		4,695

Cumulative effect of change in accounting principles-net of tax		--		(30)

Net income available to common shareholders	$	2,330	$	4,665

EPS Denominator - Basic:
Weighted average number of common shares outstanding		7,586.4		6,101.4

EPS Numerator - Diluted:
Income from continuing operations before cumulative effect of change in accounting principles	$	2,318	$	2,455

Less: ESOP allocation - net of tax		1		--

Income available to common shareholders from continuing operations before cumulative effect of change in accounting principles		2,317		2,455

Discontinued operations:
Income from operations of discontinued businesses and product lines-net of tax		13		38
Gains on sales of discontinued businesses and product lines-net of tax		--		2,202

Discontinued operations-net of tax		13		2,240

Income available to common shareholders before cumulative effect of change in accounting principles		2,330		4,695

Cumulative effect of change in accounting principles-net of tax		--		(30)

Net income available to common shareholders	$	2,330	$	4,665

EPS Denominator - Diluted:
Weighted average number of common shares outstanding		7,586.4		6,101.4
Common share equivalents--stock options, stock issuable under employee compensation plans and convertible preferred stock		92.1		60.3
Weighted average number of common shares outstanding and common share equivalents		7,678.5		6,161.7

Stock options and stock issuable under employee compensation plans representing equivalents of 193 million shares of common stock during the three months ended March 28, 2004 and 289 million shares of common stock during the three months ended March 30, 2003 had exercise prices greater than the average market price of our common stock. These common stock equivalents were outstanding during the three months ended March 28, 2004 and March 30, 2003 but were excluded from the computation of diluted EPS for this period because their inclusion would have had an antidilutive effect.

Also, in the diluted computation for the three months ended March 28, 2004, income from continuing operations and net income are reduced by the incremental contribution to the ESOP, which was acquired as part of the Pharmacia acquisition. This contribution is the after-tax difference between the income that the ESOP would have received in preferred stock dividends and the dividend on the common shares assumed to have been outstanding.

Note 12: Discontinued Operations

We evaluate our businesses and product lines on an ongoing basis for strategic fit within our operations. As a result of our evaluation, in the first three months of 2004, we decided to sell the following businesses and product lines:

-	In January 2004, we agreed to sell our in-vitro allergy and autoimmune diagnostics testing (Diagnostics) business, formerly included in the "Corporate/Other" category of our segment information, for $575 million in cash. The sale was completed on April 23, 2004. The Diagnostics business was acquired in connection with our acquisition of Pharmacia in April 2003. We recorded $153 million in revenues from this business in 2003.

-	In March 2004, we decided to sell certain non-core consumer products marketed primarily in Europe by our Consumer Healthcare segment. The majority of these products are small brands, sold in single markets only and include certain products that became a part of Pfizer in April 2003 in connection with our acquisition of Pharmacia. We recorded $103 million in revenues for all of these products in 2003.

-	In March 2004, we decided to sell certain European generic pharmaceutical businesses. The European generic businesses were included in our Pharmaceutical segment and became a part of Pfizer in April 2003, in connection with our acquisition of Pharmacia. We recorded $94 million in revenues from these businesses in 2003.

-	In March 2004, we decided to sell our surgical ophthalmic business and in April 2004, we agreed to sell this business for $450 million in cash. The surgical ophthalmic business was included in our Pharmaceutical segment and became a part of Pfizer in April 2003 in connection with our acquisition of Pharmacia. We recorded $102 million in revenues from these products in 2003.

We have included the results of operations of these businesses and product lines in discontinued operations for the three months ended March 28, 2004. Due to the timing of our acquisition of Pharmacia in April 2003, there were no results relating to these businesses and product lines included in our consolidated results of operations for the three months ended March 30, 2003 except for those relating to certain legacy Pfizer non-core consumer healthcare products which have been included in discontinued operations for the three months ended March 30, 2003.

The significant assets and liabilities relating to these businesses and product lines include intangible assets, goodwill, property, plant and equipment, inventory, accounts receivable, accrued liabilities and deferred taxes.

As a result of our evaluation, in 2003 we sold the following businesses and product lines:

-	In March 2003, we sold the Adams confectionery products business, formerly part of our Consumer Healthcare segment, for $4.2 billion in cash. We recognized a gain on the sale of this business of $3,091 million ($1,824 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In March 2003, we sold the Schick-Wilkinson Sword shaving products business, formerly part of our Consumer Healthcare segment, for $930 million in cash. We recognized a gain on the sale of this business of $462 million ($262 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In March 2003, we sold the oral contraceptives Estrostep and Loestrin, formerly part of our Pharmaceutical segment, for $197 million in cash with a right to receive up to $47.3 million contingent on Estrostep retaining market exclusivity until the expiration of its patent. We recognized a gain on the sale of these two products of $193 million ($116 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In April 2003, we completed the sale of the hormone replacement therapy femhrt, formerly part of our Pharmaceutical segment, for $160 million in cash with a right to receive up to $63.8 million contingent on femhrt retaining market exclusivity until the expiration of its patent. We recognized a gain on the sale of this product in our second quarter 2003 results.

These businesses and product lines are reported as discontinued operations in the three months ended March 30, 2003.

The following amounts have been segregated from continuing operations and reported as discontinued operations:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Revenues	$	150	$	624

Pre-tax income	$	20	$	62
Provision for taxes on income		7		24
Income from operations of discontinued businesses and product lines-net of tax		13		38
Pre-tax gains on sales of discontinued businesses and product lines		--		3,746
Provision for taxes on gains		--		1,544
Gains on sales of discontinued businesses and product lines-net of tax		--		2,202
Discontinued operations-net of tax	$	13	$	2,240

Note 13: Segment Information

We operate in the following three business segments:

Pharmaceutical

-	The Pharmaceutical segment includes treatments for cardiovascular and metabolic diseases, central nervous system disorders, arthritis and pain, infectious and respiratory diseases, urogenital conditions, cancer, eye disease, endocrine disorders and allergies.

Consumer Healthcare

-	The Consumer Healthcare segment includes self medications for oral care, upper respiratory health, tobacco dependence, gastrointestinal health, skin care, eye care and hair growth.

Animal Health

-	The Animal Health segment includes treatments for diseases in livestock and companion animals.

We operate several other businesses which include the manufacture of empty soft-gelatin capsules, contract manufacturing and bulk pharmaceutical chemicals. Due to the size of these businesses, they are grouped into the "Other" category.

Revenues and profits/(losses) by segment for the three months ended March 28, 2004 and March 30, 2003 were as follows:

(millions of dollars)			Pharma- ceutical	Consumer Healthcare	Animal Health	Other	^(a)		Consolidated

Revenues		2004	$11,041	$804	$428	$ 214		$	12,487
		2003	7,546	579	269	112			8,506

Segment profit/(loss)		2004	$ 3,601	$157	$ 45	$(674)	^(b)	$	3,129	^(c)
		2003	3,404	133	35	(356)	^(b)		3,216

^(a)	Includes Capsugel, Pfizer CentreSource and Corporate/Other.

^(b)	Includes interest income/(expense), corporate expenses, other income/(expense), certain performance-based compensation expenses not allocated to the operating segments and merger-related costs.

^(c)	Equals income from continuing operations before provision for taxes on income, minority interests and cumulative effect of change in accounting principles. Segment profit/(loss) includes the impact of purchase accounting for acquisitions.

Revenues for each group of similar products are as follows:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003	% Change

PHARMACEUTICAL
Cardiovascular and metabolic diseases	$	4,291	$	3,559	21
Central nervous system disorders		1,947		1,610	21
Arthritis and pain		1,176		89	M+
Infectious and respiratory diseases		1,234		1,088	13
Urology		636		475	34
Oncology		243		--	--
Ophthalmology		279		--	--
Endocrine disorders		219		--	--
All other		872		394	121
Alliance revenue		144		331	(56)
Total Pharmaceutical		11,041		7,546	46
CONSUMER HEALTHCARE		804		579	39
ANIMAL HEALTH		428		269	59
OTHER		214		112	91
Total revenues	$	12,487	$	8,506	47

M+ Change greater than one thousand percent.

Note 14: Subsequent Events

Action of Board of Directors

On April 22, 2004, our board of directors declared a $.17 per share second quarter 2004 cash dividend on our common stock, payable on June 4, 2004 to shareholders of record on May 14, 2004.

INDEPENDENT ACCOUNTANTS' REVIEW REPORT

To the Shareholders and Board of Directors of Pfizer Inc.:

We have reviewed the condensed consolidated balance sheet of Pfizer Inc. and Subsidiary Companies as of March 28, 2004 and the related condensed consolidated statements of income for the three-month periods ended March 28, 2004 and March 30, 2003 and cash flows for the three-month periods then ended. These condensed consolidated financial statements are the responsibility of the Company's management.

We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of Pfizer Inc. and Subsidiary Companies as of December 31, 2003, and the related consolidated statements of income, shareholders' equity and cash flows for the year then ended (not presented herein); and in our report dated February 26, 2004, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2003, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

KPMG LLP

New York , New York
May 7, 2004

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)

The components of the Condensed Consolidated Statement of Income follow:

		First Quarter
(millions of dollars, except per common share data)		2004		2003	% Change

Revenues	$	12,487	$	8,506	47

Cost of sales		1,794		1,058	69
% of revenues		14.4%		12.4%

Selling, informational and administrative expenses		3,933		2,740	44
% of revenues		31.5%		32.2%

Research and development expenses		1,649		1,218	35
% of revenues		13.2%		14.3%

Merger-related in-process research and development charges		955		--	--
% of revenues		7.7%		--

Merger-related costs		247		91	170
% of revenues		2.0%		1.1%

Other (income)/deductions-net		780		183	327

Income from continuing operations before provision for taxes on income, minority interests and cumulative effect of change in accounting principles		3,129		3,216	(3)
% of revenues		25.1%		37.8%

Provision for taxes on income		809		761	6

Effective tax rate		25.8%		23.7%

Income from continuing operations before cumulative effect of change in accounting principles		2,318		2,455	(6)
% of revenues		18.6%		28.9%

Discontinued operations-net of tax		13		2,240	(99)

Income before cumulative effect of change in accounting principles		2,331		4,695	(50)
% of revenues		18.7%		55.2%

Cumulative effect of change in accounting principles-net of tax		--		(30)	*

Net income	$	2,331	$	4,665	(50)
% of revenues		18.7%		54.8%

Earnings per common share - Basic:
Income from continuing operations before cumulative effect of change in accounting principles	$	.31	$	.40	(23)
Discontinued operations-net of tax		--		.36	*
Cumulative effect of change in accounting principles-net of tax		--		--	--
Net income	$	.31	$	.76	(59)

Earnings per common share - Diluted:
Income from continuing operations before cumulative effect of change in accounting principles	$	.30	$	.40	(25)
Discontinued operations-net of tax		--		.36	*
Cumulative effect of change in accounting principles-net of tax		--		--	--
Net income	$	.30	$	.76	(61)

Cash dividends paid per common share	$	.17	$	.15

* Calculation not meaningful.
Percentages in the table may reflect rounding adjustments.

OVERVIEW

We are a research-based, global pharmaceutical company that discovers, develops, manufactures and markets leading prescription medicines for humans and animals, as well as many of the world's best known consumer healthcare products. We generate revenue through the sale of our products as well as through alliance agreements by copromoting products discovered by other companies.

Pharmacia Acquisition

On April 16, 2003, by acquiring Pharmacia Corporation (Pharmacia),we furthered our position as the world's largest pharmaceutical company, with the scientific depth, global marketing strength and financial resources to take greater advantage of new opportunities and to bring innovative new products to market faster. We acquired Pharmacia in a stock-for-stock transaction valued at approximately $56 billion. This non-cash transaction was accounted for as a purchase business combination under accounting principles generally accepted in the United States of America (GAAP).

The results of operations discussed below include Pharmacia's product sales and expenses from the acquisition date. Therefore, our operating results for the first three months of 2004 as compared to the first three months of 2003 reflect the impact of the acquisition of Pharmacia.

In connection with the acquisition, we continue to take actions to integrate and restructure the Pharmacia operations in order to increase our profitability through cost savings and operating efficiencies. To achieve the savings, we have incurred certain merger-related expenditures of about $4.0 billion during the year ended December 31, 2003 and through March 28, 2004, which are discussed in more detail in the "Costs and Expenses" section. As a result of these activities and the combining of operations, it is not possible to provide separate results of operations for Pharmacia for the period after the acquisition date.

Esperion Acquisition

On February 10, 2004 we completed the acquisition of Esperion Therapeutics, Inc. (Esperion), a biopharmaceutical company focused on the development of high-density-lipoprotein (HDL) cholesterol-targeted therapies for the treatment of cardiovascular disease, for $1.3 billion in cash (including transaction costs). The acquisition has been accounted for as a purchase business combination. The preliminary allocation of the purchase price includes in-process research and development of $920 million, which was expensed and goodwill of $233 million, which has been allocated to our pharmaceutical segment and is not deductible for tax purposes. Esperion did not have any approved products.

Other Financial Impacts

During the first three months of 2004, we decided to sell certain businesses and product lines that were primarily acquired in connection with our acquisition of Pharmacia because they do not fit within our strategic plans. Specifically, in January 2004, we agreed to sell our in-vitro allergy and autoimmune diagnostics testing business for $575 million in cash (closed on April 23, 2004). In March 2004, we decided to sell our surgical ophthalmic business which, in April 2004, we agreed to sell for $450 million in cash (a transaction expected to close in the third quarter of 2004). In addition, in March 2004 we decided to sell certain non-core consumer healthcare products primarily marketed in Europe and certain European generic businesses. All of these businesses and product lines are reported as discontinued operations in the three months ended March 28, 2004 and in the comparable prior period where applicable.

During the first three months of 2003, we sold the Adams confectionery business, the Schick-Wilkinson Sword shaving products business and certain women's health product lines, which in the aggregate, increased net income by $2,202 million after tax. These divestitures are reported as discontinued operations in the three months ended March 30, 2003.

In the first three months of 2003, we incurred non-cash charges, which reduced net income by $30 million after tax in connection with our January 1, 2003 adoption of Statement of Financial Accounting Standards (SFAS) No. 143, Accounting for Asset Retirement Obligations . This charge was reported as a cumulative effect of a change in accounting principle.

REVENUES

Revenues increased 47% in the first quarter of 2004, as compared to the first quarter of 2003.

The revenue increase was primarily due to the inclusion of Pharmacia results, strong performances by a number of our in-line products and newly launched products across major businesses and regions and the weakening of the U.S. dollar relative to many other currencies. Eleven products--Lipitor, Norvasc, Zoloft, Celebrex, Neurontin, Zithromax, Viagra, Diflucan, Zyrtec, Bextra and Xalatan/Xalcom--each achieved revenues of more than $250 million in the quarter.

Changes in foreign exchange rates increased revenues in the first quarter of 2004 by $436 million or 5.1% compared to the same period in 2003. The foreign exchange impact on the first quarter 2004 revenue growth, relative to the same period last year, is associated with legacy Pfizer revenues only and primarily reflects the weakening of the U.S. dollar against major currencies. The revenues of legacy Pharmacia products, recorded as of the acquisition date of April 16, 2003, do not affect the impact from foreign exchange, given their treatment as incremental volume.

The loss of patent protection with respect to any of our major products, including those described in the Legal Proceedings section, could have a material adverse effect on our projected revenues and net income.

Revenues by Country

Revenues by country for the first quarter and the changes over the prior year were as follows:

		First Quarter
(millions of dollars)		2004	% of Revenues		2003	% of Revenues	% Change

United States	$	7,149	57.3	$	5,433	63.9	32
Japan		728	5.8		474	5.6	54
All other		4,610	36.9		2,599	30.5	77
Consolidated	$	12,487	100.0	$	8,506	100.0	47

Revenues by Segment

Revenues by segment for the first quarter and the changes over the prior year were as follows:

		First Quarter
(millions of dollars)		2004	% of Revenues		2003	% of Revenues	% Change

Pharmaceutical
U.S.	$	6,462	51.7	$	4,882	57.4	32
International		4,579	36.7		2,664	31.3	72
Worldwide		11,041	88.4		7,546	88.7	46

Consumer Healthcare
U.S.		416	3.3		378	4.4	10
International		388	3.1		201	2.4	93
Worldwide		804	6.4		579	6.8	39

Animal Health
U.S.		199	1.6		129	1.5	55
International		229	1.8		140	1.7	63
Worldwide		428	3.4		269	3.2	59

Other
U.S.		72	0.7		44	0.6	65
International		142	1.1		68	0.7	108
Worldwide		214	1.8		112	1.3	91

Total	$	12,487	100.0	$	8,506	100.0	47

Pharmaceutical

Worldwide revenues of the Pharmaceutical segment follow:

		First Quarter
(millions of dollars)		2004		2003	% Change

PHARMACEUTICAL
Cardiovascular and metabolic diseases	$	4,291	$	3,559	21
Central nervous system disorders		1,947		1,610	21
Arthritis and pain		1,176		89	M+
Infectious and respiratory diseases		1,234		1,088	13
Urology		636		475	34
Oncology		243		--	--
Ophthalmology		279		--	--
Endocrine disorders		219		--	--
All other		872		394	121
Alliance revenue		144		331	(56)
Total Pharmaceutical	$	11,041	$	7,546	46

M+ Change greater than one thousand percent.

Revenue information for several of our major pharmaceutical products follow:

				First Quarter
Product		Primary Indications		millions of dollars	% Change from 2003

Cardiovascular and metabolic diseases:
Lipitor		Reduction of LDL cholesterol	$	2,497		19
Norvasc		Hypertension		1,141		16
Accupril/Accuretic		Hypertension/Congestive heart failure		191		12
Cardura		Hypertension/Benign prostatic hyperlasia		148		10
Caduet		Reduction of LDL cholesterol and hypertension		28		--
Central nervous system disorders:
Zoloft		Depression and anxiety disorders		810		7
Neurontin		Epilepsy and neuropathic pain		696		12
Geodon		Schizophrenia		88		14
Xanax/Xanax XR		Anxiety/Panic disorders		86		--
Aricept*		Alzheimer's disease		71		30
Relpax		Migraine headaches		30		(7)
Arthritis and pain:
Celebrex		Arthritis pain and inflammation		769		M+
Bextra		Arthritis pain and inflammation		270		--
Infectious and respiratory diseases:
Zithromax		Bacterial infections		466		(15)
Diflucan		Fungal infections		304		6
Vfend		Fungal infections		64		81
Zyvox		Bacterial infections		97		--
Urology:
Viagra		Erectile dysfunction		416		(12)
Detrol/Detrol LA		Overactive bladder		206		--
Oncology:
Camptosar		Metastic colorectal cancer		91		--
Ellence		Breast cancer		80		--
Ophthalmology:
Xalatan/Xalcom		Glaucoma		279		--
Endocrine disorders:
Genotropin		Replacement of human growth hormone		179		--
All other:
Zyrtec		Allergies		299		2
Alliance revenue:**
Aricept, Spiriva, Rebif and Mirapex		Alzheimer's disease (Aricept), chronic obstructive pulmonary disease (Spiriva), multiple sclerosis (Rebif), Parkinson's disease (Mirapex)		144		(56)

*	Represents direct sales under license agreement with Eisai Co., Ltd.
**	Alliance revenue in 2003 included Celebrex and Bextra under copromotion agreements with Pharmacia.
M+	Change greater than one thousand percent.

Selected Product Updates:

Lipitor

Lipitor continues to maintain its position as the leading statin. The share of U.S. total prescriptions of lipid-lowering drugs held by Lipitor was 43.4% in March 2004. Despite the challenges of multiple new competitors (Crestor, Zetia, Vytorin/Inegy, and generics), Lipitor achieved 9% growth in total prescriptions in the U.S. lipid-lowering market in March 2004. In addition, despite Crestor launches in the U.K., Canada, the Netherlands, and recently in the U.S., Lipitor continues post double-digit sales growth, including 14% sales growth in the U.S. in the first quarter of 2004, compared to the same period in 2003.

Norvasc

Norvasc's success has been driven by its outstanding efficacy, once-daily dosing, consistent 24-hour control of hypertension and angina, and excellent safety and tolerability. Beyond Norvasc's current leadership, there continues to be an opportunity for growth. Hypertension affects about 50 million Americans and one billion people worldwide. In 2003, both the National Heart, Lung, and Blood Institute (NHLBI) in the U.S. and the European Society of Hypertension-European Society of Cardiology issued new hypertension guidelines that call for early and aggressive blood-pressure management and acknowledge that the majority of patients may require two or more medications to reach their blood-pressure targets. The new NHLBI guidelines include the Healthy People 2010 goal, which is to have 50% of hypertensive Americans reach the blood-pressure goal of 140/90 mm Hg or less. Currently 69% of American adults with hypertension are not at their blood-pressure goal.

Zoloft

Zoloft has proven efficacy, safety, and tolerability in treating mood and anxiety disorders and is approved for the broadest range of such disorders of any antidepressant. This breadth of coverage is important from a clinical perspective, as these mental disorders are widespread and evidence significant co-morbidity.

Neurontin

Neurontin has been approved in more than 60 markets for treatment of a range of neuropathic-pain conditions. Pfizer is focusing both on educational initiatives targeted at improving the management of neuropathic pain and efforts to ensure that Neurontin is effectively prescribed and that the recommended dose of 1,800 mg per day is achieved over a period of 15 days. To support these efforts, new 600 mg and 800 mg scored tablets were introduced in the first quarter of 2004, making it easier for the patient to achieve the recommended dose of 1,800 mg/day. Since the launch of the scored tablets and our focus on the recommended dose of 1,800 mg/day, we have seen increases in tablet sales and increases in the number of physicians of all specialities (primary-care physicians, neurologists, and pain specialists) prescribing 1,800 mg/day.

Celebrex

Celebrex is the No. 1 COX-2-specific inhibitor in the world, having the broadest range of approved indications. It provides strong efficacy, excellent tolerability, and a proven safety profile in providing relief for the pain and inflammation of osteoarthritis, rheumatoid arthritis, acute pain, and primary dysmenorrhea. Since its launch in 1999, Celebrex has accumulated more than 10 million patient years of use and more than 149 million prescriptions worldwide, demonstrating efficacy and tolerability among a patient population whose need for long-term, effective relief of pain and inflammation is great and growing.

Bextra

In February 2004, Bextra achieved a 9.4% share of new prescriptions in the U.S. NSAID market. Additional Bextra studies in acute pain for a U.S. supplemental filing are expected to be completed in 2004.

Zithromax

The decrease in sales compared to the same period in 2003 is primarily due to a weak respiratory season in the U.S. during the first quarter.

Diflucan

Diflucan sales were adversely impacted by the entry of generic oral fluconazole products after Diflucan lost patent protection in much of Europe in 2003 as well as in Japan, the U.K., and Germany. In the U.S., the FDA granted Diflucan six months of market exclusivity through July 29, 2004, as a result of pediatric testing .

Viagra

The decrease in sales compared to the same period in 2003 reflects the impact from the launch of two competitors in the U.S. market in the second half of 2003 and a change in wholesaler stocking given the reduction in revenues and market share. In markets outside the U.S. where we have faced competition for more than a year, Viagra sales grew 8%. Viagra continues to be studied in pulmonary arterial hypertension (PAH). European regulatory authorities recently granted orphan-drug status for the use of Viagra, pending regulatory submission and approval, for the treatment of PAH, thus providing ten years of exclusivity for that indication.

Xalatan/Xalcom

Xalatan, a prostaglandin indicated for the treatment of open-angle glaucoma and ocular hypertension, is the No. 1 prescribed glaucoma medication in all promoted markets, including the U.S., Europe, and Japan. It is the first and only prostaglandin with a first-line indication for the treatment of elevated eye pressure. Xalcom consists of Xalatan with the beta blocker timolol. Future Xalatan/Xalcom global sales growth will come through market expansion. While the U.S. glaucoma market has been experiencing low unit growth, about one third of diagnosed glaucoma patients are untreated. In addition, only 10-15% of ocular-hypertensive patients (a high-risk group for developing glaucoma, based on the study described above) are currently being treated in the U.S. Several comparative clinical trials and recent European Glaucoma Society guidelines support Xalatan use in newly treated patients before less efficacious and/or poorly tolerated therapies.

Zyrtec

The increase in sales compared to the same period in 2003 was achieved despite the 16% decline in year-to-date new prescriptions in the antihistamine market due to the availability of multiple over-the-counter (OTC) branded and private-label loratadine (Claritin) products since December 2002. Zyrtec remains the only prescription antihistamine with a syrup formulation and, as of March 2004, became the only prescription antihistamine with a chewable formulation as well.

Consumer Healthcare

Revenues of our Consumer Healthcare business follow:

		First Quarter
(millions of dollars)		2004		2003	% Change

Consumer Healthcare	$	804	$	579	39

The increase in consumer healthcare revenues in the first quarter of 2004, as compared to the prior year period, was primarily due to the inclusion of Pharmacia products as well as:

-	the 12% increase in the first quarter of 2004 in sales of Listerine mouthwash, which benefited from the recent U.S. launch of Natural Citrus flavor

-	the 13% and 20% increases in the first quarter of 2004 of Benadryl and Sudafed due to a strong cough/cold season

-	the favorable impact of the weakening of the U.S. dollar against major currencies

Animal Health

Revenues of our Animal Health business were as follows:

		First Quarter
(millions of dollars)		2004		2003	% Change

Livestock products	$	266	$	145	83
Companion animal products		162		124	31
Total Animal Health	$	428	$	269	59

The increase in animal health revenues in the first quarter of 2004 as compared with the prior year period was primarily due to the inclusion of Pharmacia products, which are reflected in both product categories, and the favorable impact of the weakening of the U.S. dollar against major currencies.

Livestock product revenues increased 83% in the first quarter of 2004, as compared with the prior year period, with key performance as follows:

-	Cattle biologicals grew 19% over the prior year period driven by the launch of Spirovac (for the prevention of bacterial infection of the reproductive tract) in the first quarter of last year in the U.S., and a new claim for Bovishield (protects pregnant cows and fetal and nursing calves against viral diseases) launched in the U.S. during the fourth quarter of last year

-	Performance also reflects the launch of Draxxin (for treatment of respiratory disease in cattle and swine) in Europe during the first quarter of 2004

partially offset by:

-	Swine vaccine sales decline of 11% in the first quarter of 2004, as compared with prior year period, due to competitive market conditions in the U.S.

-	The impact of the bovine spongiform encephalopathy issue (mad cow disease) and generic and branded competition

Companion animal product revenues increased 31% in the first quarter of 2004, as compared with the prior year period, with key brand performance as follows:

-	Revolution (for protection against fleas and heartworm) sales grew 39% in the first quarter of 2004 due to increased promotional efforts (especially in feline) throughout our markets

-	Clavamox/Synulox (an antibiotic for dogs and cats) sales grew 21% in the first quarter of 2004 primarily due to increased promotional activities in the U.S.

-	Rimadyl (for relief of arthritis pain in dogs and for post-operative pain) sales grew 20% in the first quarter of 2004 due to increased promotional efforts throughout our markets and the launch of an injectable form in the U.S.

COSTS AND EXPENSES

Cost of Sales

Cost of sales increased 69% in the first quarter of 2004 as compared with the prior year period, while revenues increased 47% in the first quarter of 2004.

Overall, our cost of sales in the first quarter of 2004 was impacted by:

-	change in product mix, given the addition of legacy Pharmacia's product portfolio, which has a higher product cost relative to legacy Pfizer's product portfolio

-	the impact of reflecting cost of goods sold for Celebrex and Bextra from the April 16, 2003 acquisition date of Pharmacia, compared to recognizing alliance revenue for the copromotion of Celebrex and Bextra prior to April 16, 2003, which had no cost of goods sold recorded by Pfizer

-	the unfavorable impact of foreign exchange largely due to the weakening of the dollar relative to the euro

Selling, Informational and Administrative Expenses

Selling, informational and administrative expenses (SI&A) increased 44% in the first quarter of 2004, as compared with the prior year period, mainly due to incremental expenditures associated with the consolidation of Pharmacia-SI&A related activities from the acquisition date, partially offset by cost synergies from Pharmacia-related restructuring activities. Marketing expenses of our pharmaceutical products increased 46% in the first quarter of 2004 and included costs associated with support for new product introductions and in light of new product competition.

Research and Development Expenses

Research and development (R&D) expenses increased 35% in the first quarter of 2004, as compared with the prior year period. Year over year growth for first quarter R&D spending is attributable to the incremental expenditures associated with the consolidation of Pharmacia-related activity subsequent to the acquisition date and increased support of the advanced-stage development portfolio partially offset by cost synergies from Pharmacia related restructuring activities.

Product Developments

We continue to invest in R&D to provide future sources of revenue through the development of new products, as well as through additional uses for existing in-line and alliance products. We possess a broad and deep pipeline of medicines in development. We have five new products that were recently approved or are undergoing regulatory review in the U.S. and/or E.U. (Inspra, Caduet, pregabalin, Exubera, Daxas). We have launched, or intend to launch, these products in new markets once regulatory approvals are received. However, there are no assurances as to when, or if, we will receive regulatory approval for these or any of our other new products.

Certain significant regulatory actions by and filings pending with, the FDA follow:

Recent FDA Approvals:

Product	Indication	Date Approved

Zyrtec	Chewable tablets for treatment of seasonal and perennial allergic rhinitis and chronic idiopathic urticaria in children aged two years and older	March 2004

Caduet	Single product that combines cholesterol-lowering and anti-hypertensive medications in Lipitor and Norvasc	January 2004

Spiriva	Chronic obstructive pulmonary disease	January 2004

Zithromax	Acute bacterial sinusitis	January 2004

Pending U.S. New Drug Applications (NDAs) and Supplemental Filings:

Product	Indication	Date Submitted

Vfend	Treating invasive candidiasis and candidemia	March 2004

Depo-Provera	Injectable formulations to treat endometriosis	December 2003
	Subcutaneous formulation for contraception	June 2003

Zyvox	Use in penicillin-resistant streptococcus pneumonia infections in patients with pneumonia	December 2003

Bextra	Migraine	November 2003

pregabalin	Neuropathic pain, add-on epilepsy, and generalized anxiety disorder	October 2003

Geodon	Acute mania in bipolar disorder	October 2003
	Oral suspension dosage form	September 2002

Diflucan	Use in children to treat fungal infections	October 2003

Fragmin	Use to prevent the formulation of venous blood clots	February 2003

Viracept	Use in children with HIV	June 2003

Cardura XL	Benign prostatic hyperplasia (enlarged prostate)	April 2001

Other Regulatory Approvals and Filings:

Product/Compound in Development	Description of Event	Date Approved	Date Submitted

Inspra	Received marketing approval in The Netherlands	March 2004	--

Caduet	Received marketing approval in Brazil	February 2004	--

Vfend	Approval of a powder for oral suspension (POS) formulation was granted in the E.U.	February 2004	--

Exubera	Filing submitted in the E.U.	--	February 2004

Daxas (roflumilast)	Filing submitted in the E.U.	--	February 2004

Ongoing or planned clinical trials for additional uses and dosage forms for our products include:

Product	Indication

Viagra	Pulmonary arterial hypertension in both children and adults

Celebrex	Sporadic adenomatous polyposis--a precancerous condition caused by growths in the intestines
	Bladder cancer
	Barrett's esophagus--a precancerous condition caused by repeated damage from stomach acid regurgitation
	Actinic keratosis--a precancerous skin growth caused by overexposure to sunlight
	Ankylosing spondylitis--an inflammation of the spine
	Chronic lower back pain

Bextra	Acute pain, including gout

Zithromax	Sustained release Zithromax (bacterial infections)
	Cystic fibrosis
	Drug resistant malaria (combination with chloroquine)

Vfend	Candidemia in non-neuropenic patients
	Fungal infections in immuno-compromised patients

Camptosar IV	Use in children
	Adjuvant colorectal cancer
	Gastric cancer

Fragmin	Use in oncology patients to reduce cardiac toxicity associated with chemotherapy

Xalatan (new formulation)	Ocular hypertension

Advanced-stage clinical studies are continuing for several agents including:

-	indiplon for the treatment of insomnia, under co-development with Neurocrine Biosciences, Inc. (Neurocrine)

-	Macugen for age-related macular degeneration and macular edema, under co-development with Eyetech Pharmaceuticals, Inc. (Eyetech)

-	capravirine for HIV/AIDS in treatment-experienced patients

-	SU-11,248 an agent that blocks certain kinases for treatment of gastrointestinal tumors and other cancers

-	edotecarin for glioma (brain tumor) and colorectal cancer

-	lasofoxifene for osteoporosis and other indications

-	varenicline for smoking cessation

-	Exubera, an inhalable form of insulin for Type 1 and Type 2 diabetes under co-development, co-manufacture, and co-marketing with Aventis Pharma (Aventis), with the participation of Nektar Therapeutics

-	Parecoxib (Dynastat), an injectable COX-2 inhibitor for pain and inflammation

-	Lipitor-torcetrapib for cholesterol disorders and atherosclerosis

-	Daxas (roflumilast) for chronic obstructive pulmonary disease and asthma under co-development with Altana Pharma

-	Zithromax/chloroquine combination for malaria

-	sumanirole for Parkinson's disease

-	asenapine for schizophrenia and bipolar disorders, under co-development with the Organon healthcare unit of Akzo-Nobel

Additional product-related programs are in various stages of discovery and development.

MERGER-RELATED IN-PROCESS RESEARCH AND DEVELOPMENT CHARGES

We recorded a charge of $955 million in the first quarter of 2004 based on our preliminary estimate of the portion of the purchase price allocated to in-process research and development which included $920 million for Esperion and two animal health businesses. A project-by-project valuation is being performed by independent valuation specialists to determine the fair value of research and development projects that were in-process, but not yet completed. The final valuations are expected to be completed as soon as possible but no later than one year from the respective acquisition dates. To the extent that our estimates need to be adjusted, we will do so. No additional charges for in-process research and development relating to Pharmacia are expected.

MERGER-RELATED COSTS

We incurred the following merger-related costs primarily in connection with our acquisition of Pharmacia which was completed on April 16, 2003:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Integration costs:
Pharmacia	$	101	$	80
Other		3		8
Restructuring costs:
Pharmacia		143		--
Other		--		3
Total merger-related costs - expensed	$	247	$	91
Total merger-related costs - capitalized	$	1,107	$	--

Integration costs represent external, incremental costs directly related to an acquisition including expenditures for consulting and systems integration when incurred.

Restructuring costs represent costs associated with asset write-offs, exit activities, employee termination costs and certain relocation costs.

Cost synergies resulting from the acquisition of Pharmacia totaled more than $800 million in the first quarter of 2004 and are expected to be about $3.4 billion in full-year 2004 and about $4 billion in full year 2005. Synergies stem from a broad range of sources, including a streamlined organization, reduced operating expenses and procurement savings.

In connection with the acquisition of Pharmacia, Pfizer management approved plans throughout 2003 and during the first three months of 2004 to restructure the operations of both legacy Pfizer and legacy Pharmacia to eliminate duplicative facilities and reduce costs. The restructuring of our operations as a result of our acquisition of Pharmacia is expected to continue through 2005 and is expected to include severance, costs of vacating duplicative facilities and contract termination and other exit costs. Total merger-related expenditures (income statement and balance sheet) incurred during 2003-2005 to achieve these synergies are expected to be about $6.0 billion, on a pre-tax basis.

Restructuring Costs Associated with Legacy Pfizer - Expensed

During the first three months of 2004, we recorded $143 million of restructuring costs associated with exiting certain activities of legacy Pfizer, including severance, costs of vacating duplicative facilities and contract termination and other exit costs. Through March 28, 2004, we have recorded, in total, $320 million of restructuring costs and at March 28, 2004, liabilities for restructuring costs incurred but not paid totaled $134 million and are included in Other current liabilities .

The majority of the restructuring costs are related to employee terminations. Through March 28, 2004, employee termination costs totaling $232 million ($92 million recorded in the first three months of 2004) represent the approved reduction of the legacy Pfizer work force by 2,091 employees, mainly in corporate, manufacturing, distribution, sales and research. We notified affected individuals and 1,452 employees were terminated as of March 28, 2004.

Restructuring Costs Associated with Legacy Pharmacia - Capitalized

During the first three months of 2004, we recorded $1,107 million of restructuring costs associated with employee terminations and exiting certain activities of legacy Pharmacia. These costs were recognized as liabilities assumed in the purchase business combination. Accordingly, the restructuring charges incurred in the first year after the acquisition are considered part of the purchase price of Pharmacia and have been recorded as an increase to goodwill. Through March 28, 2004, we have recorded, in total, $2,685 million of restructuring costs and at March 28, 2004, liabilities for restructuring costs incurred but not paid totaled $1,209 million and are included in Other current liabilities . Future restructuring charges associated with legacy Pharmacia will be charged to the results of operations.

The majority of the restructuring costs are related to employee terminations. Through March 28, 2004, employee termination costs totaling $1,552 million ($263 million recorded in the first three months of 2004) represent the approved reduction of the legacy Pharmacia work force by 13,045 employees mainly in corporate, manufacturing, distribution, sales and research. We notified affected individuals and 11,596 employees were terminated as of March 28, 2004. Employee termination costs include accrued severance benefits and costs associated with change-in-control provisions of certain Pharmacia employment contracts.

Restructuring charges are recorded when specific decisions to exit activities are approved and incurred. Reductions to our estimates of restructuring charges relating to legacy Pharmacia that were originally recorded as goodwill will be recorded as an adjustment to goodwill. Increases to the estimates of completing the currently approved restructuring plans or costs related to new restructuring initiatives relating to legacy Pharmacia subsequent to April 15, 2004 will be recorded in our results of operations.

OTHER (INCOME)/DEDUCTIONS-NET

Other (income)/deductions-net includes amortization expense of $807 million (primarily relating to intangible assets acquired from Pharmacia) in the first quarter of 2004 and copromotion charges and payments for intellectual property rights of $255 million in the first quarter of 2003.

TAXES ON INCOME

The estimated effective tax rate (ETR) used in calculating full-year 2004 income from continuing operations before cumulative effect of change in accounting principles is 25.8%. The projected full-year 2004 ETR is lower than the 49.7% ETR related to our 2003 income from continuing operations before cumulative effect of change in accounting principles primarily due to the decreased merger-related in-process research and development charges, which are not deductible.

DISCONTINUED OPERATIONS

We evaluate our businesses and product lines on an ongoing basis for strategic fit within our operations. As a result of our evaluation, in the first three months of 2004, we either sold or decided to sell the following businesses and product lines:

-	In January 2004, we agreed to sell our in-vitro allergy and autoimmune diagnostics testing (Diagnostics) business, formerly included in the "Corporate/Other" category of our segment information for $575 million in cash. The sale was completed on April 23, 2004. The Diagnostics business was acquired in connection with our acquisition of Pharmacia in April 2003. We recorded $153 million in revenues from this business in 2003.

-	In March 2004, we decided to sell certain non-core consumer products marketed primarily in Europe by our Consumer Healthcare segment. The majority of these products are small brands, sold in single markets only and include certain products that became a part of Pfizer in April 2003 in connection with our acquisition of Pharmacia. We recorded $103 million in revenues for all of these products in 2003.

-	In March 2004, we decided to sell certain European generic pharmaceutical businesses. The European generic businesses were included in our Pharmaceutical segment and became a part of Pfizer in April 2003, with our acquisition of Pharmacia. We recorded $94 million in revenues from these businesses in 2003.

In March 2004, we decided to sell our surgical ophthalmic business and in April 2004, we agreed to sell this business for $450 million in cash. The surgical ophthalmic business was included in our Pharmaceutical segment and became a part of Pfizer in April 2003 in connection with our acquisition of Pharmacia. We recorded $102 million in revenues from these products in 2003.

We have included the results of operations of these businesses and product lines in discontinued operations for three months ended March 28, 2004. Due to the timing of our acquisition of Pharmacia in April 2003, there were no results relating to these businesses and product lines included in our consolidated results of operations for the three months ended March 30, 2003 except for those relating to certain legacy Pfizer non-core consumer healthcare products which have been included in discontinued operations for the three months ended March 30, 2003.

As a result of our evaluation, in 2003 we sold the following businesses and product lines:

-	In March 2003, we sold the Adams confectionery products business, formerly part of our Consumer Healthcare segment, for $4.2 billion in cash. We recognized a gain on the sale of this business of $3,091 million ($1,824 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In March 2003, we sold the Schick-Wilkinson Sword shaving products business, formerly part of our Consumer Healthcare segment, for $930 million in cash. We recognized a gain on the sale of this business of $462 million ($262 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In March 2003, we sold the oral contraceptives Estrostep and Loestrin, formerly part of our Pharmaceutical segment, for $197 million in cash with a right to receive up to $47.3 million contingent on Estrostep retaining market exclusivity until the expiration of its patent. We recognized a gain on the sale of these two products of $193 million ($116 million net of tax) in the consolidated statement of income for the first three months of 2003.

-	In April 2003, we completed the sale of the hormone replacement therapy femhrt, formerly part of our Pharmaceutical segment, for $160 million in cash with a right to receive up to $63.8 million contingent on femhrt retaining market exclusivity until the expiration of its patent. We recognized a gain on the sale of this product in our second quarter 2003 results.

These businesses and product lines are reflected as discontinued operations in the three months ended March 30, 2003.

The following have been segregated from continuing operations and reported as discontinued operations:

		Three Months Ended
(millions of dollars)		March 28, 2004		March 30, 2003

Revenues	$	150	$	624

Pre-tax income	$	20	$	62
Provision for taxes on income		7		24
Income from operations of discontinued businesses and product lines-net of tax		13		38
Pre-tax gains on sales of discontinued businesses and product lines		--		3,746
Provision for taxes on gains		--		1,544
Gains on sales of discontinued businesses and product lines-net of tax		--		2,202
Discontinued operations-net of tax	$	13	$	2,240

ADJUSTED INCOME

The Company reports adjusted income in order to portray the results of its major operations--the discovery, development, manufacture, marketing, and sale of market-leading prescription medicines for humans and animals, as well as many of the world's best-known over-the-counter products. We believe investors' understanding of our performance is enhanced by disclosing adjusted income, defined as net income excluding discontinued operations, the cumulative effect of changes in accounting principles, significant impacts of purchase accounting for acquisitions, merger-related costs and certain significant items. Management itself analyzes the company's performance on this basis.

We have excluded significant purchase-accounting impacts, such as those related to our acquisitions of Pharmacia and Esperion. These impacts can include charges for purchased in-process research and development, the incremental charge to cost of sales from the sale of acquired inventory that was written up to fair value, and the incremental charges related to the amortization of finite-lived intangible assets and depreciation of fixed assets for the increase to fair value. We believe that excluding these non-cash charges provides a better view of our economic performance.

The costs to integrate and restructure the operations of acquired businesses, such as Pharmacia, can be significant. We have excluded integration and restructuring costs from adjusted income because these costs are unique to the transactions and typically occur over several years due to the global and highly regulated nature of our business.

Pfizer excludes gains or losses on the sale of businesses and product lines included in discontinued operations as well as the related results of operations. While we review our businesses and product lines on an ongoing basis for strategic fit with our operations, we do not build or run our businesses with an intent to sell them and, therefore, we have excluded such gains or losses on sales of businesses or product lines from adjusted income.

Certain significant items represent substantive unusual and non-recurring items. For example, significant charges that relate to the settlement of legal matters would be considered a certain significant item.

In 2004, we revised our basis for adjusted income such that we no longer exclude certain items from adjusted income. For example, copromotion charges and payments for intellectual-property rights for unapproved products being developed by third parties and the contribution of divestitures were previously excluded in the calculation of adjusted income. We have revised our previous 2003 basis for adjusted income to conform to the 2004 presentation.

A reconciliation between net income, as reported under GAAP, and adjusted income follows:

		First Quarter
(millions of dollars)		2004		2003	% Incr./ (Decr.)

Reported net income	$	2,331	$	4,665	(50)
Discontinued operations-net of tax		(13)		(2,240)	(99)
Cumulative effect of change in accounting principles-net of tax		--		30	*
Purchase accounting adjustments-net of tax		1,513		--	*
Merger-related costs-net of tax		126		56	126
Certain significant items-net of tax		19		--	*
Adjusted income	$	3,976	$	2,511	58

*Calculation not meaningful.

Adjusted income as shown above excludes the following items:

			First Quarter
(millions of dollars)			2004		2003

Discontinued operations, pre-tax:
Income from operations of discontinued businesses and product lines ^(a)		$	(20)	$	(62)
Gains on sales of discontinued businesses and product lines ^(a)			--		(3,746)
Total discontinued operations pre-tax			(20)		(3,808)
Income taxes			7		1,568
Total discontinued operations-net of tax			(13)		(2,240)
Cumulative effect of change in accounting principles-net of tax			--		30
Purchase accounting adjustments, pre-tax:
In-process research and development ^(b)			955		--
Intangible amortization and other ^(c)			803		--
Total purchase accounting adjustments, pre-tax			1,758		--
Income taxes			(245)		--
Total purchase accounting adjustments-net of tax			1,513		--
Merger-related costs, pre-tax:
Integration costs--Pharmacia ^(d)			101		80
Integration costs--Other ^(d)			3		8
Restructuring charges--Pharmacia ^(d)			143		--
Restructuring charges--Other ^(d)			--		3
Total merger-related costs, pre-tax			247		91
Income taxes			(121)		(35)
Total merger-related costs-net of tax			126		56
Certain significant items, pre-tax
Operating results of legacy Pharmacia research facility held for sale ^(e)			32		--
Total certain significant items, pre-tax			32		--
Income taxes			(13)		--
Total certain significant items,-net of tax			19		--
Total discontinued operations, cumulative effect of change in accounting principle, purchase accounting adjustments, merger-related costs and certain significant items-net of tax		$	1,645	$	(2,154)

^(a)	Included in Discontinued operations-net of tax .
^(b)	Included in Merger-related in-process research and development charges .
^(c))	Included primarily in Other (income)/deductions-net .
^(d)	Included in Merger-related costs .
^(e)	Included in Research and development expenses .

RECLASSIFICATION OF SELECTED HISTORICAL RESULTS

Pfizer has classified certain revenues and expenses differently from prior performance reports. In accordance with generally accepted accounting principles applied in the United States, Pfizer has classified the results of businesses and product lines that the company intends to divest as Discontinued Operations and restated 2003 results accordingly. These are not restatements of errors in our financial statements.

In addition, as detailed above, the company revised its definitions of adjusted income. The previous 2003 measures have been restated accordingly. The adjustments principally relate to the exclusion of the income from operations of discontinued businesses and product lines and the inclusion of copromotion charges and payments for intellectual-property rights for unapproved products being developed by third parties. A reconciliation of the impacts of these classifications for 2003 follows (certain amounts may reflect rounding adjustments):

Impact of Reclassifications
			Three Months Ended March 30, 2003
(millions of dollars)			Revenues		Adjusted Income

Originally reported		$	8,525	$	2,744
Discontinued businesses and product lines			(19)		(38)	*
Certain significant items			0		(195)
Restated		$	8,506	$	2,511

*	Includes income from operations (net of tax) of $5 million for the 2004 discontinued businesses and product lines and $33 million for the 2003 discontinued businesses and product lines during the three months ended March 30, 2003.

			Three Months Ended June 29, 2003
(millions of dollars)			Revenues		Adjusted Income

Originally reported		$	9,993	$	2,374
Discontinued businesses and product lines			(93)		--	*
Purchase accounting impacts related to 2004 discontinued operations			--		(20)
Certain significant items			--		(10)
Restated		$	9,900	$	2,344

*	Includes the income from operations (net of tax) of $0 million for the 2004 discontinued businesses and product lines and $0 million for the 2003 discontinued businesses and product lines during the three months ended June 29, 2003.

			Three Months Ended September 28, 2003
(millions of dollars)			Revenues		Adjusted Income

Originally reported		$	12,504	$	3,636
Discontinued businesses and product lines			(156)		2	*
Purchase accounting impacts related to 2004 discontinued operations			--		(26)
Certain significant items			--		64
Restated		$	12,348	$	3,676

*	Includes income from operations (net of tax) of $2 million for the 2004 discontinued businesses and product lines and a $4 million loss from operations for the 2003 discontinued businesses and product lines during the three months ended September 28, 2003.

			Three Months Ended December 31, 2003					Year Ended December 31, 2003
(millions of dollars)			Revenues		Adjusted Income			Revenues		Adjusted Income

Originally reported		$	14,167	$	3,968		$	45,188	$	12,722
Discontinued businesses and product lines			(186)		9	*		(452)		(26)	*
Purchase accounting impacts related to 2004 discontinued operations			--		(30)			--		(76)
Certain significant items			--		(165)			--		(308)
Restated		$	13,981	$	3,782		$	44,736	$	12,312

*	Includes income from operations (net of tax) of $3 million and $10 million for the 2004 discontinued businesses and product lines during the three months and twelve months ended December 31, 2003 and a $12 million loss from operations and $16 million income from operations for the 2003 discontinued businesses and product lines during the three months and twelve months ended December 31, 2003.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Our net financial asset position was as follows:

(millions of dollars)		March 28, 2004		Dec. 31, 2003

Financial assets:
Cash and cash equivalents	$	965	$	1,520
Short-term investments		12,987		10,432
Short-term loans		448		391
Long-term investments and loans		5,430		6,142
Total financial assets	$	19,830	$	18,485
Debt:
Short-term borrowings	$	10,692	$	8,818
Long-term debt		7,144		5,755
Total debt	$	17,836	$	14,573
Net financial assets	$	1,994	$	3,912

We rely largely on operating cash flow, short-term commercial paper borrowings and long-term debt to provide for the working capital needs of our operations, including our R&D activities. Our short-term and long-term investments consist primarily of high quality, liquid investment-grade debt securities. Wherever possible, cash management is centralized and intercompany financing is used to provide working capital to our operations. Where local restrictions prevent intercompany financing, working capital needs are met through operating cash flows and/or external borrowings.

Our short-term borrowings are rated P1 by Moody's Investors Service (Moody's) and A-1+ by Standard & Poor's (S&P). Also, our long-term debt has been rated Aaa by Moody's and AAA by S&P for more than 17 years. Moody's and S&P are the major corporate debt-rating organizations. Our superior credit ratings are primarily based on our diversified product portfolio, our strong operating cash flows and our substantial financial assets. Our access to short-term financing at favorable rates would be affected by a substantial downgrade in our credit ratings.

We have available lines of credit and revolving-credit agreements with a group of banks and other financial intermediaries. We maintain cash balances and short-term investments in excess of our commercial paper borrowings and have access to $2.7 billion of lines of credit, of which $2.2 billion expire within one year. Of these lines of credit, $2.3 billion are unused, of which our lenders have committed to loan us $1.0 billion at our request.

At March 28, 2004, we had the ability to borrow approximately $3.0 billion by issuing debt securities under our $5 billion debt shelf registration statement filed with the SEC in November 2002.

In February 2004, we issued the following debt under our debt shelf registration, which will be used for current general corporate purposes, including the refinancing of existing debt:

-	$750 million senior unsecured notes, due February 2014, which pay interest semi-annually, beginning on August 15, 2004, at a rate of 4.5%; and

-	$700 million senior unsecured notes, due March 2007, which pay interest semi-annually, beginning on September 15, 2004, at a rate of 2.5%

Selected measures of liquidity and capital resources:

			March 28, 2004		Dec. 31, 2003

Cash and cash equivalents and short-term loans and investments (millions of dollars)		$	14,400	$	12,343

Working capital (millions of dollars)*		$	10,752	$	6,768

Current ratio**			1.44:1		1.28:1

Shareholders' equity per common share***		$	9.11	$	8.63


*	Working capital includes assets and liabilities of discontinued businesses held for sale at March 28, 2004 and December 31, 2003.

**	Current ratio is the proportion of current assets to current liabilities.

***	Represents total shareholders' equity divided by the actual number of common shares outstanding (which excludes treasury shares and those held by our employee benefit trust).

The increase in working capital from December 31, 2003 to March 28, 2004 primarily reflects:

-	cash from current period operations

-	cash receipts from long-term debt issuances under our existing debt shelf registration -- $1,450 million

-	an increase in accounts receivable levels at the end of the first quarter of 2004 that is comparable to the same period in 2003 and consistent with historic business trends which include organic sales growth

partially offset by:

-	purchases of property, plant and equipment -- $472 million

-	purchases of our common stock -- $912 million

-	net cash paid to acquire Esperion and two animal health businesses -- $1,443 million

-	cash dividends on common and preferred stock -- $1,282 million

Net Cash Provided by Operating Activities

During the first three months of 2004, net cash provided by continuing operating activities was $1,583 million, as compared to $2,323 million in the 2003 period. The change in net cash provided by operating activities in 2004 was primarily due to current period income from operations, net of non-cash items, which included the gain (net of related tax effects) on the disposal of certain businesses and product lines in 2003 offset by increases primarily in accounts receivable, inventory as well as payments of accrued litigation settlements.

Net Cash Used in Investing Activities

During the first three months of 2004, net cash used in investing activities of $3,721 million, as compared to $1,883 million in the 2003 period. The change in net cash used in investing activities in 2004 was primarily attributable to:

-	an increase in net purchases of short-term and long-term investments (an increase of $1,115 million)

-	an increase in purchases of property, plant and equipment (an increase of $90 million) due primarily to expenditures at certain legacy Pharmacia manufacturing facilities

-	net cash paid of $1,443 million relating to the acquisition of Esperion and two animal health businesses

offset by:

-	the 2003 proceeds from the sales of businesses and product lines ($1,178 million)

Net Cash Provided by/(Used in) Financing Activities

During the first three months of 2004 net cash provided by financing activities was $1,583 million, as compared to net cash used of $252 million in the 2003 period. The change in net cash provided by/(used in) financing activities in 2004 was primarily attributable to:

-	an increase in stock options exercised (an increase of $519 million)

-	an increase in net borrowings (an increase of $2,017 million) due primarily to issuing, in February 2004, $1,450 million in senior unsecured notes under our existing debt shelf registration

partially offset by:

-	an increase in cash dividends paid (an increase of $376 million) due to an increase in the dividend and a larger number of shares outstanding resulting from the acquisition of Pharmacia

-	an increase in common share purchases (an increase of $314 million) due to our share-purchase program

In December 2003, we announced a new $5 billion share-purchase program which we expect to be completed by the end of 2004 and which will be funded from operating cash flows. During the first three months of 2004 we purchased 24.8 million shares of common stock at a total cost of $912 million.

Off-Balance Sheet Arrangements

Legacy Pharmacia guaranteed certain transactions in which Monsanto, its former agricultural subsidiary, is involved. These guarantees continued after Pfizer's acquisition of Pharmacia and at March 28, 2004 included approximately $250 million of bank notes with maturities not later than 2004 and $5 million of environmental guarantees, which are required until Monsanto can obtain certain approvals.

Certain of our copromotion agreements include additional provisions that give our alliance partners the right to negotiate for or in some cases to obtain copromotion rights in specified countries with respect to certain of the Company's products.

OUTLOOK

Our targets for strong financial performance throughout 2004 remain unchanged--2004 revenue of about $54 billion, adjusted income of $16.3 billion, and adjusted diluted EPS of $2.13 with achievement of these targets subject to many variables cited in the disclosure notice found in this document, including foreign exchange. We now project 2004 reported net income of $11.9 billion and 2004 reported diluted EPS of $1.55. The difference between reported and adjusted diluted EPS is attributable to projected incremental purchase-accounting-related intangible amortization/fixed asset depreciation of $2.3 billion, or $.30 per share, merger-related costs of $1.2 billion, or $.15 per share, and in-process research and development expenses for Esperion and two animal health business acquisitions of $955 million, or $.13 per share, which were recorded in the first quarter of 2004. We plan to spend about $7.9 billion on R&D during 2004.

Our estimates for both reported and adjusted income for 2004 exclude the contributions of divestitures and include milestone payments to development partners.

CAUTIONARY FACTORS THAT MAY AFFECT FUTURE RESULTS

Our disclosure and analysis in this report contain forward-looking information about our company's financial results and estimates, business prospects and products in research that involve substantial risks and uncertainties. From time to time, we also may provide oral or written forward-looking statements in other materials we release to the public. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historic or current facts. They use words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "will," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective products or product approvals, future performance or results of current and anticipated products, sales efforts, expenses, interest rates, foreign exchange rates, the outcome of contingencies, such as legal proceedings, and financial results. Among the factors that could cause actual results to differ materially are the following:

-	the success of research and development activities and the speed with which regulatory authorizations, pricing approvals, and product launches may be achieved

-	competitive developments affecting our current growth products

-	the ability to successfully market both new and existing products domestically and internationally

-	difficulties or delays in manufacturing

-	trade buying patterns

-	the ability to meet generic and branded competition after the loss of patent protection for our products

-	trends toward managed care and health care cost containment

-	possible U.S. legislation or regulatory action affecting, among other things, pharmaceutical pricing and reimbursement, including Medicaid and Medicare and involuntary approval of prescription medicines for over-the-counter use

-	the potential impact of the Medicare Prescription Drug Improvement and Modernization Act of 2003

-	legislation or regulations in markets outside the U.S. affecting product pricing, reimbursement or access

-	contingencies related to actual or alleged environmental contamination

-	legal defense costs, insurance expense, settlement costs and the risk of an adverse decision or settlement related to product liability, patent protection, government investigations and other legal proceedings

-	the company's ability to protect its patents and other intellectual property both domestically and internationally

-	interest rate and foreign currency exchange rate fluctuations

-	governmental laws and regulations affecting domestic and foreign operations, including tax obligations

-	changes in generally accepted accounting principles

-	any changes in business, political and economic conditions due to the threat of future terrorist activity in the U.S. and other parts of the world, and related U.S. military action overseas

-	growth in costs and expenses

-	changes in our product mix

-	the impact of acquisitions, divestitures, restructurings, product withdrawals and other unusual items, including our ability to integrate and to obtain the anticipated results and synergies from our acquisition of Pharmacia

We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements.

We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our Forms 10-Q, 8-K and 10-K reports to the Securities and Exchange Commission. Our Form 10-K filing for the 2003 fiscal year listed various important factors that could cause actual results to differ materially from expected and historic results. We note these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. Readers can find them in Item 1 of that filing under the heading " Factors That May Affect Future Results." We incorporate that section of that Form 10-K in this filing and investors should refer to it. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.

Legal Proceedings and Contingencies

We and certain of our subsidiaries are involved in various patent, product liability, consumer, commercial, environmental, and tax litigations and claims; government investigations; and other legal proceedings that arise from time to time in the ordinary course of our business. We do not believe any of them will have a material adverse effect on our financial position. Litigation is inherently unpredictable, and excessive verdicts do occur. Although we believe we have valid defenses in these matters, we could in the future incur judgments or enter into settlements of claims that could have a material adverse effect on our results of operations in any particular period.

Patent claims include challenges to the coverage and/or validity of our patents on various products or processes. Although we believe that we have valid defenses to these challenges with respect to all our material patents, there can be no assurance as to the outcome of these matters, and a loss in any of these cases could result in a loss of patent protection for the drug at issue, which could lead to a significant loss of sales of that drug and could materially affect future results of operations.

Item 4. Disclosure Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective in alerting them in a timely manner to material information required to be disclosed in our periodic reports filed with the SEC.

In addition, we reviewed our internal controls, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of their most recent evaluation.

FORM 10-Q

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Certain legal proceedings in which we are involved are discussed in Note 20 to the consolidated financial statements included in our 2003 Financial Report and in Part I, Item 3, of our Annual Report on Form 10-K for the year ended December 31, 2003. The following discussion is limited to recent developments concerning our legal proceedings and should be read in conjunction with those earlier Reports. Unless otherwise indicated, all proceedings discussed in those earlier Reports remain outstanding.

Patent Matters

Diflucan (fluconazole)

As previously reported, our basic product patent for fluconazole (Diflucan) expired in January 2004. The FDA has granted us pediatric exclusivity with respect to Diflucan, which extends our marketing exclusivity for six months after the patent expiration date, through July 29, 2004. One of the generic manufacturers that has filed an abbreviated new drug application for fluconazole brought an action against the FDA challenging the grant of pediatric exclusivity. The U.S. District Court for the District of Columbia upheld the FDA's grant of pediatric exclusivity on March 10, 2004, and the generic manufacturer appealed that decision. On April 26, 2004, the U.S. Court of Appeals for the District of Columbia affirmed the District Court's decision upholding the grant of pediatric exclusivity.

Xalatan (latanoprost)

As previously reported, in November 2001, a generic manufacturer notified Pharmacia that it had filed an abbreviated new drug application with the FDA seeking approval to market a product containing latanoprost, which Pharmacia markets as Xalatan. In December 2001, Pharmacia filed suit against the generic manufacturer in the U.S. District Court for the District of New Jersey alleging infringement of various patents relating to latanoprost that are held by or licensed to Pharmacia. The generic manufacturer has admitted infringement but claims that these patents are invalid and unenforceable. The trial of this matter was held in March 2004, and we are awaiting a decision.

Detrol (tolterodine)

As previously reported, in February 2004, a generic manufacturer notified us that it had filed an abbreviated new drug application with the FDA seeking approval to market tolterodine (Detrol). We filed a patent infringement suit against the generic manufacturer in the U.S. District Court for the District of New Jersey on March 26, 2004.

Accupril (quinapril)

In January 1999, a generic manufacturer filed an abbreviated new drug application with the FDA seeking approval to market quinapril (Accupril). In March 1999, Warner-Lambert filed a patent infringement suit against the generic manufacturer in the U.S. District Court for the District of New Jersey. In October 2003, the court granted our motions for summary judgment on various issues, including with respect to infringement of our patent by the generic manufacturer. The trial on the remaining issues was held in May 2004, and we are awaiting a decision. In addition, several purported class actions have been filed in federal and state courts claiming that our assertions of or attempts to enforce our patent rights with respect to quinapril violate federal and state antitrust and deceptive practices laws.

Product Liability Matters

Asbestos

As of March 31, 2004: (i) approximately 169,900 claims naming Pfizer and/or Quigley Company, Inc. (which is a subsidiary of Pfizer) and numerous other defendants were pending in various federal and state courts seeking damages for alleged asbestos exposure and exposure to other allegedly hazardous materials, and (ii) approximately 135,500 claims naming American Optical Corporation (which is a former subsidiary of Warner-Lambert) and numerous other defendants were pending in various federal and state courts seeking damages for alleged asbestos exposure and exposure to other allegedly hazardous materials.

Commercial Matters

Qui Tam Action Relating to Manufacturing Practices

As previously reported, Pfizer, Pharmacia and other pharmaceutical companies have been named in a qui tam action that was filed in the U. S. District Court for the Northern District of Texas in June 2001 but not served on Pfizer and Pharmacia until 2003. The complaint alleges that the defendants have generally failed to comply with good manufacturing practices mandated by the FDA, that as a consequence their products sold to or reimbursed by the federal government are adulterated and/or misbranded, and that the federal government is entitled to refunds of purchase prices paid. In February 2004, the court granted the plaintiff's motion for leave to amend the complaint and denied defendants' consolidated motion to dismiss as moot. The plaintiff filed an amended complaint in February 2004, and defendants filed a consolidated motion to dismiss the amended complaint in April 2004. To date, the federal government has not intervened in the action. We believe the claims with respect to Pfizer and Pharmacia are without merit.

NeoPharm Arbitration

As previously reported, in 1999, Pharmacia and NeoPharm entered into an agreement to develop NeoPharm's technology for lipisome encapsulation of certain cancer drugs. In April 2002, NeoPharm filed a demand for arbitration under the agreement, alleging that Pharmacia had breached the agreement by failing to use reasonable efforts to develop, market and sell the technology. NeoPharm sought specific performance and damages for lost profits. In May 2002, Pharmacia filed its response and asserted a counterclaim for rescission and the return of certain payments on the ground that NeoPharm had misrepresented the technology. On April 30, 2004, the arbitration panel rendered its decision that Pharmacia did not breach the agreement. The panel also denied NeoPharm's claims for specific performance and damages. At the same time, the panel denied Pharmacia's counterclaim for rescission.

Tax Matters

The Internal Revenue Service (IRS) has completed and closed its audits of Pfizer Inc.'s tax returns through 1998 and Warner-Lambert Company through 1998. The IRS is currently conducting audits of Pfizer Inc's tax returns for the years 1999 through 2001 and Warner-Lambert Company for the years 1999 through the date of merger (June 19, 2000). With respect to Pharmacia, the IRS is currently conducting audits of Pharmacia Inc.'s tax returns for the years 1998 and 1999, while Pharmacia Inc.'s tax returns for 1995 through 1997 which were under appeal have been completed. Pharmacia also has responsibility for the currently on-going IRS audit of its former agricultural subsidiary Monsanto's tax returns for the years 1998 and 1999.

We believe that our accruals for tax liabilities are adequate for all open years

Item 2.	Changes in Securities, Use of Proceeds and Issuer
	Purchases of Equity Securities

This table provides information with respect to purchases by the Company of shares of its Common Stock during the fiscal first quarter of 2004:

Issuers Purchases of Equity Securities*

Period		Total Number of Shares Purchased**	Average Price Paid per Share**	Total Number of Shares Purchased as Part of Publicly Announced Plan*	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan*
January 1, 2004 through January 31, 2004		2,578,712	$36.41	3,525,000	$4,873,572,310
February 1, 2004 through February 29, 2004		8,716,940	$37.48	12,135,000	$4,550,913,760
March 1, 2004 through March 28, 2004		13,729,081	$36.47	25,850,000	$4,050,735,904
Total		25,024,733	$36.81	25,850,000

*	On December 15, 2003, the Company announced that the Board of Directors authorized the purchase of up to $5 billion of the Company's Common Stock (the "2003 Stock Purchase Plan"). Such purchases are expected to be completed by the end of 2004.

**	In addition to purchases under the 2003 Stock Purchase Plan, this column reflects the following transactions during the fiscal first quarter of 2004: (i) the deemed surrender to the Company of 224,120 shares of Common Stock to pay the exercise price and to satisfy tax withholding obligations in connection with the exercise of employee stock options, and (ii) the surrender to the Company of 25,613 shares of Common Stock to satisfy tax withholding obligations in connection with the vesting of restricted stock issued to employees.

Item 4.

Submission of Matters to a Vote of Security Holders

The shareholders of the company voted on eight items at the Annual Meeting of Shareholders held on April 22, 2004:

1.		the election of fifteen directors to terms ending in 2005
2.		a proposal to approve the appointment of KPMG LLP as independent auditor for 2004
3.		a proposal to approve the Pfizer Inc. 2004 Stock Plan
4.		a shareholder proposal requesting review of the economic effects of the HIV/AIDS, tuberculosis and malaria pandemics on the Company's business strategy
5.		a shareholder proposal relating to an annual report on corporate resources devoted to supporting political entities or candidates
6.		a shareholder proposal seeking to impose term limits on directors
7.		a shareholder proposal requesting a report on increasing access to Pfizer products
8.		a shareholder proposal on in vitro testing

The nominees for directors were elected based upon the following votes:

Nominee	Votes For	Votes Withheld
Michael S. Brown	6,402,288,172	116,943,283
M. Anthony Burns	6,330,740,631	188,490,824
Robert N. Burt	6,323,893,761	195,337,694
W. Don Cornwell	6,322,149,479	197,081,976
William H. Gray III	6,363,032,765	156,198,690
Constance J. Horner	6,356,677,577	162,553,878
William R. Howell	6,319,319,736	199,911,719
Stanley O. Ikenberry	6,355,798,076	163,433,379
George A. Lorch	6,370,298,296	148,933,159
Henry A. McKinnell	6,342,751,695	176,479,760
Dana G. Mead	6,400,020,991	119,210,464
Franklin D. Raines	6,393,181,305	126,050,150
Ruth J. Simmons	6,397,853,407	121,378,048
William C. Steere Jr.	6,354,309,397	164,922,058
Jean-Paul Valles	6,245,477,022	273,754,433

The proposal to approve the appointment of KPMG LLP as independent auditors for 2004 received the following votes:

-	6,237,591,622	Votes for approval
-	235,143,794	Votes against
-	46,496,039	Abstentions
	There were no broker non-votes for this item.

The proposal to approve the Pfizer Inc. 2004 Stock Plan received the following votes:

-	4,716,082,472	Votes for approval
-	457,845,073	Votes against
-	62,929,951	Abstentions
-	1,282,373,959	Broker non-votes

The shareholder proposal requesting review of the economic effects of the HIV/AIDS, tuberculosis and malaria pandemics on the Company's business strategy received the following votes:

-	462,213,020	Votes for approval
-	4,268,874,397	Votes against
-	505,497,255	Abstentions
-	1,282,646,783	Broker non-votes

The shareholder proposal relating to an annual report on corporate resources devoted to supporting political entities or candidates received the following votes:

-	520,162,713	Votes for approval
-	4,244,239,467	Votes against
-	472,191,078	Abstentions
-	1,282,638,197	Broker non-votes

The shareholder proposal seeking to impose term limits on directors received the following votes:

-	177,708,514	Votes for approval
-	4,983,930,379	Votes against
-	74,976,525	Abstentions
-	1,282,616,037	Broker non-votes

The shareholder proposal requesting a report on increasing access to Pfizer products received the following votes:

-	238,610,025	Votes for approval
-	4,556,606,150	Votes against
-	441,397,254	Abstentions
-	1,282,618,026	Broker non-votes

The shareholder proposal on in vitro testing received the following votes:

-	104,385,062	Votes for approval
-	4,600,923,325	Votes against
-	511,908,466	Abstentions
-	1,302,014,602	Broker non-votes

Two additional shareholder proposals, one relating to political contributions and one relating to stock options, that were submitted for consideration at the Annual Meeting were not voted on because the respective shareholder proponents were not present at the meeting to introduce the proposals.

Item 6.	Exhibits and Reports on Form 8-K

(a)	Exhibits

	1) Exhibit 3	-	Restated Certificate of Incorporation of Pfizer Inc.

	2) Exhibit 12	-	Ratio of Earnings to Fixed Charges and Ratio of Earnings to Fixed Charges and Preferred Stock Dividends

	3) Exhibit 15	-	Accountants' Acknowledgment

	4) Exhibit 31.1	-	Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

	5) Exhibit 31.2	-	Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

	6) Exhibit 32.1	-	Certification by the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

	7) Exhibit 32.2	-	Certification by the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b)	Reports on Form 8-K

	We filed a report on Form 8-K during the first quarter ended March 28, 2004 on the following date for the purposes specified: On January 22, 2004, to report our financial results for the fourth quarter and year ended December 31, 2003.

PFIZER INC. AND SUBSIDIARY COMPANIES

SIGNATURE

Under the requirements of the Securities Exchange Act of 1934, this report was signed on behalf of the Registrant by the authorized person named below.

		Pfizer Inc.
		(Registrant)


Dated: May 7, 2004		/s/ Loretta V. Cangialosi

		Loretta V. Cangialosi, Vice President, Controller (Principal Accounting Officer and Duly Authorized Officer)

Exhibit 12

PFIZER INC. AND SUBSIDIARY COMPANIES
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS

		Three Months Ended March 28,		Year Ended December 31,
(in millions, except ratios)		2004		2003		2002		2001		2000		1999

Determination of earnings:
Income from continuing operations before provision for taxes on income, minority interests and cumulative effect of change in accounting principles	$	3,129	$	3,246	$	11,766	$	9,963	$	5,471	$	6,945
Less:
Minority interests		2		3		6		14		13		5
Adjusted income		3,127		3,243		11,760		9,949		5,458		6,940
Fixed charges		114		491		365		359		478		463
Total earnings as defined	$	3,241	$	3,734	$	12,125	$	10,308	$	5,936	$	7,403

Fixed charges:
Interest expense ^(a)	$	58	$	270	$	251	$	266	$	381	$	364
Preferred stock dividends ^(b)		3		10		--		--		--		--
Rents ^(c)		53		211		114		93		97		99
Fixed charges		114		491		365		359		478		463

Capitalized interest		4		20		28		56		46		40

Total fixed charges	$	118	$	511	$	393	$	415	$	524	$	503

Ratio of earnings to fixed charges		27.5		7.3		30.9		24.8		11.3		14.7

All financial data for 2004 and 2003 reflect our in-vitro allergy and autoimmune diagnostics testing business, European generic businesses and surgical ophthalmic business as well as for 2004, 2003, 2002, 2001 and 2000 certain non-core consumer healthcare products (primarily marketed in Europe) which have been presented in discontinued operations beginning in the three months ended March 28, 2004.

All financial data for 2003, 2002, 2001 and 2000 reflect our confectionery, shaving and fish-care products businesses as well as the Estrostep, Loestrin and femhrt women's health product lines as discontinued operations.

We have not restated periods prior to 2000 for these discontinued operations because the data are not available. After we reorganized our financial systems due to the merger with Warner-Lambert Company, the level of detail necessary to develop financial information for these discontinued operations for periods prior to 2000 was no longer available.

(a)	Interest expense includes amortization of debt premium, discount and expenses.

(b)	Preferred stock dividends are from our Series A convertible perpetual preferred stock held by an Employee Stock Ownership Plan assumed in connection with our acquisition of Pharmacia.

(c)	Rents included in the computation consist of one-third of rental expense which we believe to be a conservative estimate of an interest factor in our leases, which are not material.

Exhibit 15

ACCOUNTANTS' ACKNOWLEDGMENT

To the Shareholders and Board of Directors of Pfizer Inc.:

We hereby acknowledge our awareness of the incorporation by reference of our report dated November 12, 2003, included within the Quarterly Report on Form 10-Q of Pfizer Inc. for the quarter ended September 28, 2003, in the following Registration Statements:

- Form S-8 dated October 27, 1983 (File No. 2-87473),

- Form S-8 dated March 22, 1990 (File No. 33-34139),

- Form S-8 dated January 24, 1991 (File No. 33-38708),

- Form S-8 dated November 18, 1991 (File No. 33-44053),

- Form S-3 dated May 27, 1993 (File No. 33-49629),

- Form S-8 dated May 27, 1993 (File No. 33-49631),

- Form S-8 dated May 19, 1994 (File No. 33-53713),

- Form S-8 dated October 5, 1994 (File No. 33-55771),

- Form S-3 dated November 14, 1994 (File No. 33-56435),

- Form S-8 dated December 20, 1994 (File No. 33-56979),

- Form S-8 dated March 29, 1996 (File No. 33-02061),

- Form S-8 dated September 25, 1997 (File No. 333-36371),

- Form S-8 dated April 24, 1998 (File No. 333-50899),

- Form S-8 dated April 22, 1999 (File No. 333-76839),

- Form S-8 dated June 19, 2000 (File No. 333-90975),

- Form S-8 dated June 19, 2000 (File No. 333-39606),

- Form S-8 dated June 19, 2000 (File No. 333-39610),

- Form S-3 dated October 20, 2000 (File No. 333-48382),

- Form S-8 dated April 27, 2001 (File No. 333-59660),

- Form S-8 dated April 27, 2001 (File No. 333-59654),

- Form S-3 dated October 30, 2002 (File No. 333-100853),

- Form S-3 dated December 26, 2002 (File No. 33-56435),

- Form S-8 dated April 16, 2003 (File No. 333-104581),

- Form S-8 dated April 16, 2003 (File No. 333-104582).

- Form S-8 dated November 18, 2003 (File No. 333-110571)

- Form S-8 dated December 18, 2003 (File No. 333-111333) and

- Form S-8 dated April 26, 2004 (File No.333-114852).

Pursuant to Rule 436(c) under the Securities Act of 1933, such report is not considered a part of a registration statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

KPMG LLP

New York , New York
May 7, 2004

Exhibit 31.1

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Henry A. McKinnell, certify that:

1.	I have reviewed this report on Form 10-Q of Pfizer Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 7, 2004

/s/ Henry A. McKinnell

Henry A. McKinnell
Chairman of the Board
and Chief Executive Officer

Exhibit 31.2

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, David L. Shedlarz, certify that:

1.	I have reviewed this report on Form 10-Q of Pfizer Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 7, 2004

/s/ David L. Shedlarz

David L. Shedlarz
Executive Vice President and
Chief Financial Officer

Exhibit 32.1

Certification by the Chief Executive Officer Pursuant to 18 U. S. C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U. S. C. Section 1350, I, Henry A. McKinnell, hereby certify that, to the best of my knowledge, the Quarterly Report of Pfizer Inc. on Form 10-Q for the quarter ended March 28, 2004 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, and that the information contained in that Report fairly presents, in all material respects, the financial condition and results of operations of Pfizer Inc.

/s/ Henry A. McKinnell
Henry A. McKinnell
Chairman of the Board and Chief Executive Officer
May 7, 2004

This certification accompanies this Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by such Act, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

Exhibit 32.2

Certification by the Chief Financial Officer Pursuant to 18 U. S. C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U. S. C. Section 1350, I, David L. Shedlarz, hereby certify that, to the best of my knowledge, the Quarterly Report of Pfizer Inc. on Form 10-Q for the quarter ended March 28, 2004 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, and that the information contained in that Report fairly presents, in all material respects, the financial condition and results of operations of Pfizer Inc.

/s/ David L. Shedlarz
David L. Shedlarz
Executive Vice President and Chief Financial Officer
May 7, 2004

Exhibit 3

RESTATED CERTIFICATE OF INCORPORATION

PFIZER INC.

Pfizer Inc., a corporation organized and existing under the laws of the State of Delaware, HEREBY CERTIFIES AS FOLLOWS:

1. The name of the corporation is Pfizer Inc. The name under which it was originally incorporated was Chas. Pfizer & Co., Inc. The date of filing its original Certificate of Incorporation with the Secretary of State was June 2, 1942.

2. This Restated Certificate of Incorporation was duly adopted in accordance with Section 245 of the General Corporation Law of Delaware.

3. This Restated Certificate of Incorporation only restates and integrates and does not further amend the provisions of the Certificate of Incorporation as amended or supplemented heretofore and there is no discrepancy between this Restated Certificate of Incorporation and the text of the Certificate of Incorporation as amended or supplemented heretofore.

4. The text of the Certificate of Incorporation as amended or supplemented heretofore is hereby restated without further amendments or changes to read as herein set forth in full:

FIRST: The name of the Corporation is and shall be Pfizer Inc. (hereinafter in this Restated Certificate of Incorporation called the "Corporation").

SECOND: The principal office and place of business of the Corporation in the State of Delaware is located at 1209 Orange Street, in the City of Wilmington, County of New Castle; and the name and post office address of the registered agent of the Corporation in the State of Delaware is The Corporation Trust Company, 1209 Orange Street, in the City of Wilmington, County of New Castle, Delaware.

THIRD: The nature of the business, or objects or purposes to be transacted, promoted or carried on are as follows:

To carry on the business of chemists, druggists, chemical manufacturers, importers, exporters, manufacturers of and dealers in chemical, pharmaceutical, medicinal, and other preparations and chemicals.

To engage in, conduct, perform or participate in every kind of commercial, agricultural, mercantile, manufacturing, mining, transportation, industrial or other enterprise, business, work, contract, undertaking, venture or operation.

To buy, sell, manufacture, refine, import, export and deal in all products, goods, wares, merchandise, substances, apparatus, and property of every kind, nature and description, and to construct, maintain, and alter any buildings, works or mines.

To enter into, make and perform contracts of every kind with any person, firm or corporation.

To take out patents, trade-marks, trade names and copyrights, acquire those taken out by others, acquire or grant licenses in respect of any of the foregoing, or work, transfer, or do whatever else with them may be thought fit.

To acquire the good-will, property, rights, franchises, contracts and assets of every kind and undertake the liabilities of any person, firm, association or corporation, either wholly or in part, and pay for the same in the stock, bonds or other obligations of the Corporation or otherwise.

To purchase, hold, own, sell, assign, transfer, mortgage, pledge or otherwise dispose of shares of the capital stock of any other corporation or corporations, association or associations, of any state, territory or country, and while owner of such stock, to exercise all the rights, powers and privileges of ownership including the right to vote thereon.

To issue bonds, debentures or obligations of the Corporation, at the options of the Corporation, secure the same by mortgage, pledge, deed of trust or otherwise, and dispose of and market the same.

To purchase, hold and re-issue the shares of its capital stock and its bonds and other obligations.

To do all and everything necessary, suitable, convenient or proper for the accomplishment of any of the purposes or the attainment of one or more of the objects herein enumerated, or of the powers herein named, or which shall at any time appear conducive to or expedient for the protection, or benefit of the Corporation, either as holder of, or interested in, any property or otherwise, to the same extent as natural persons might or could do, in any part of the world.

To conduct any of its business in the State of Delaware and elsewhere, including in the term "elsewhere" any of the states, districts, territories, colonies or dependencies of the United States, and in any and all foreign countries and to have one or more offices, and to hold, purchase, mortgage and convey real and personal property, without limit as to amount, within or (except as and when forbidden by local laws) without the State of Delaware.

To carry on any other business to any extent and in any manner not prohibited by the laws of Delaware or, where the Corporation may seek to do such business elsewhere, by local laws.

The foregoing clauses shall be construed both as objects and powers, but no recitation or declaration of specific or special objects or powers herein enumerated shall be deemed to be exclusive; but in each and every instance it is hereby expressly declared that all other powers, not inconsistent therewith, now or hereafter permitted or granted under the laws of Delaware, or by the laws of any other state or country into which the Corporation may go or seek to do business, are hereby expressly included as if such other or general powers were herein set forth.

FOURTH:

A. Authorized Shares and Classes of Stock.

The total number of shares and classes of stock that the Company shall have authority to issue is twelve billion twenty-seven million (12,027,000,000) shares, which shall be divided into two classes, as follows: twenty-seven million (27,000,000) shares of Preferred Stock, without par value, and twelve billion (12,000,000,000) shares of Common Stock of the par value of $.05 per share.

B. Designations, Powers, Preferences and Rights,
in Respect of the Shares of Preferred Stock.

(1) Shares of the Preferred Stock may be issued in one or more series at such time or times and for such consideration or considerations as the Board of Directors may determine. All shares of any one series shall be of equal rank and identical in all respects.

(2) Authority is hereby expressly granted to the Board of Directors to fix from time to time, by resolution or resolutions providing for the issue of any series of Preferred Stock, the designation of such series, and the powers, preferences and rights of the shares of such series, and the qualifications, limitations or restrictions thereof, including the following:

(a) The distinctive designation and number of shares comprising such series, which number may (except where otherwise provided by the Board of Directors in creating such series) be increased or decreased (but not below the number of shares then outstanding) from time to time by like action of the Board of Directors;

(b) The dividend rate or rates on the shares of such series and the preferences, if any, over any other series (or of any other series over such series) with respect to dividends, the terms and conditions upon which and the periods in respect of which dividends shall be payable, whether and upon what conditions such dividends shall be cumulative and, if cumulative, the date or dates from which dividends shall accumulate;

(c) Whether or not the shares of such series shall be redeemable, the limitations and restrictions with respect to such redemptions, the time or times when, the price or prices at which and the manner in which such shares shall be redeemable, including the manner of selecting shares of such series for redemption if less than all shares are to be redeemed;

(d) The rights to which the holders of shares and such series shall be entitled, and the preferences, if any, over any other series (or of any other series over such series), upon the voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up of the Corporation, which rights may vary depending on whether such liquidation, dissolution, distribution or winding-up is voluntary or involuntary, and, if voluntary, may vary at different dates;

(e) Whether or not the shares of such series shall be subject to the operation of a purchase, retirement or sinking fund, and, if so, whether and upon what conditions such purchase, retirement or sinking fund shall be cumulative or noncumulative, the extent to which and the manner in which such fund shall be applied to the purchase or redemption of the shares of such series for retirement or to other corporate purposes and the terms and provisions relative to the operation thereof;

(f) Whether or not the shares of such series shall be convertible into or exchangeable for shares of stock of any other class or classes, or any other series of the same class and, if so convertible or exchangeable, the price or prices or the rate or rates of conversion or exchange and the method, if any, of adjusting the same, and any other terms and conditions of such conversion or exchange;

(g) The voting powers, full and/or limited, if any, of the shares of such series; and whether or not and under what conditions the shares of such series (alone or together with the shares of one or more other series having similar provisions) shall be entitled to vote separately as a single class, for the election of one or more additional directors of the Corporation in case of dividend arrearages or other specified events, or upon other matters;

(h) Whether or not the issuance of any additional shares of such series, or of any shares of any other series, shall be subject to restrictions as to issuance, or as to the powers, preferences or rights of any such other series;

(i) Whether or not the holders of shares of such series shall be entitled, as a matter of right, to subscribe for or purchase any part of any new or additional issue of stock of any class or of securities convertible into stock of any class and, if so entitled, the qualifications, conditions, limitations and restrictions of such right; and

(j) Any other preferences, privileges and powers, and relative, participating, optional or other special rights, and qualifications, limitations or restrictions of such series, as the Board of Directors may deem advisable and as shall not be inconsistent with the provisions of this Certificate of Incorporation.

(3) The shares of each series of Preferred Stock shall entitle the holders thereof to receive, when, as and if declared by the Board of Directors out of funds legally available for dividends, cash dividends at the rate, under the conditions, for the periods and on the dates fixed by the resolution or resolutions of the Board of Directors pursuant to authority granted in this Section B, for each series, and no more, before any dividends on the Common Stock, other than dividends payable in Common Stock, shall be paid or set apart for `payment. No dividends shall be paid or declared or set apart for payment on any particular series of Preferred Stock in respect of any period unless dividends shall be or have been paid, or declared and set apart for payment, pro rata on all shares of Preferred Stock at the time outstanding of each other series which ranks equally as to dividends with such particular series, so that the amount of dividends declared on such particular series shall bear the same ratio to the amount declared on each such other series as the dividend rate of such particular series shall bear to the dividend rate of such other series. No dividends shall be deemed to have accrued on any share of Preferred Stock of any series with respect to any period prior to the date of original issue of such share or the dividend payment date immediately preceding or following such date of original issue, as may be provided in the resolution or resolutions creating such series. The Preferred Stock shall not be entitled to participate in any dividends declared and paid on the Common Stock, whether payable in cash, stock or otherwise. Accruals of dividends shall not bear interest.

(4) Any redemption of Preferred Stock shall be effected by notice duly given as hereinafter specified and by payment at the redemption price of the Preferred Stock to be redeemed. In case of redemption of a part only of a series of the Preferred Stock at the time outstanding, the selection of shares for redemption may be made either by lot or pro rata or in such other manner as shall be determined by the Board of Directors. Notice of every such redemption, stating the redemption date and price, the place of payment, and the expiration date of then existing rights, if any, of conversion or exchange, shall be given by publication, not less than 30 nor more than 60 days prior to the date fixed for redemption, at least twice in a newspaper customarily published at least once a day for at least five days in each calendar week and of general circulation in New York, New York, whether or not published on Saturdays, Sundays, or holidays. Notice of such redemption may also be mailed not less than 30 nor more than 60 days prior to the date fixed for redemption to the holders of record of the shares so to be redeemed at their respective addresses as the same shall appear on the books of the Corporation, but no failure to mail such notice or any defect therein or in the mailing thereof shall affect the validity of such redemption proceedings. If

(a) such notice of redemption by publication shall have been duly given or the Corporation shall have given to a bank or trust company in New York, New York designated by the Board of Directors and having capital and surplus of at least Two Million Dollars ($2,000,000), irrevocable authorization promptly to give such notice; and

(b) on or before the redemption date specified in such notice the funds or other property necessary for such redemption shall have been deposited by the Corporation with such bank or trust company, designated in such notice, in trust for the pro rata benefit of the holders of the shares so called for redemption, then, notwithstanding that any certificate for shares so called for redemption shall not have been surrendered for cancellation, from and after the time of such deposit all shares of the Preferred Stock so called for redemption shall no longer be deemed to be outstanding and all rights with respect to such shares shall forthwith cease and terminate, except only

(i) the right of the holders thereof to receive from such bank or trust company the funds or other property so deposited, without interest, upon surrender (and endorsement, if required by the Board of Directors) of the certificates for such shares, and

(ii) the rights of conversion or exchange, if any, not theretofore expired.

Any funds or other property so deposited and unclaimed at the end of six years from such redemption date shall be released or repaid to the Corporation, after which the holders of the shares so called for redemption shall look only to the Corporation for payment thereof.

(5) Shares of Preferred Stock which have been redeemed or converted, or which have been issued and reacquired in any manner and retired, shall have the status of authorized and unissued Preferred Stock and may be reissued by the Board of Directors as shares of the same or any other series.

(6) In the event of any voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up of the Corporation, the holders of the shares of each series of Preferred Stock then outstanding shall be entitled to receive out of the net assets of the Corporation, but only in accordance with the preference, if any, provided for such series, before any distribution or payment shall be made to the holders of the Common Stock, the amount per share fixed by the resolution or resolutions of the Board of Directors to be received by the holders of shares of each such series on such voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up, as the case may be. If such payment shall have been made in full, to the holders of all outstanding Preferred Stock of all series, or duly provided for, the remaining assets of the Corporation shall be available for distribution among the holders of the Common Stock. If upon any such liquidation, dissolution, distribution, of assets or winding-up, the net assets of the Corporation available for distribution among the holders of any one or more series of the Preferred Stock which (a) are entitled to a preference over the holders of the Common Stock upon such liquidation, dissolution, distribution of assets or winding-up, and (b) rank equally in connection therewith, shall be insufficient to make payment in full of the preferential amount to which the holders of such shares shall be entitled, then such assets shall be distributed among the holders of each such series of the Preferred Stock ratably according to the respective amounts to which they would be entitled in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full. Neither the consolidation or merger of the Corporation, nor the sale, lease or conveyance of all or part of its assets, shall be deemed a liquidation, dissolution, distribution of assets or winding-up of the Corporation within the meaning of the foregoing provisions.

(7) Unless and except to the extent otherwise required by law or provided in the resolution or resolutions of the Board of Directors pursuant to this Section B, the shares of Preferred Stock shall have no voting power with respect to any matter whatsoever, including, but not limited to, any action to

(a) increase the authorized number of shares of the Preferred Stock or of any series thereof,

(b) create shares of stock of any class ranking prior to or on a parity with any series of the Preferred Stock with respect to any preferences or voting powers, and

(c) authorize a new series of the Preferred Stock having preferences or voting powers ranking prior to or on a parity with any series of the Preferred Stock with respect to any preferences or voting powers.

In no event shall the Preferred Stock be entitled to more than one vote in respect of each share of stock.

C. Limitations, Relative Rights and Powers
in Respect of Shares of Common Stock.

(l) After the requirements with respect to preferential dividends, if any, on the Preferred Stock (fixed pursuant to Section B) shall have been met and after the Corporation shall have complied with all the requirements, if any, with respect to the setting aside of sums as purchase, retirement or sinking funds (fixed pursuant to Section B), then and not otherwise the holders of Common Stock shall be entitled to receive such dividends as may be declared from time to time by the Board of Directors.

(2) After distribution in full of the preferential amount, if any, (fixed pursuant to Section B) to be distributed to the holders of Preferred Stock in the event of the voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up of the Corporation, the holders of the Common Stock shall be entitled to receive all the remaining assets of the Corporation of whatever kind available for the distribution to stockholders ratably in proportion to the number of shares of Common Stock held by them respectively.

(3) Except as may be otherwise required by law or by this Certificate of Incorporation, each holder of Common Stock shall have one vote in respect of each share of stock held by him on all matters voted upon by the stockholders.

D. Other Provisions.

(l) Except as may be provided in the resolution or resolutions of the Board of Directors pursuant to Section B with respect to any series of Preferred Stock, no holder of stock of any class of the Corporation shall be entitled as of right to purchase or subscribe for any part of any unissued stock of any class, or of any additional stock of any class of Capital Stock of the Corporation, or to any bonds, certificates of indebtedness, debentures, or other securities convertible into stock of the Corporation, now or hereafter authorized, but any such stock or other securities convertible into stock may be issued and disposed of pursuant to resolution by the Board of Directors to such persons, firms, corporations or associations and upon such terms and for such consideration as the Board of Directors in the exercise of its discretion may determine and as may be permitted by law. Any and all shares of stock so issued for which the consideration so fixed has been paid or delivered to the Corporation shall be fully paid and not liable to any further call.

(2) In no case shall fractions of shares of any class of stock be issued by the Corporation, but in lieu thereof the Corporation shall, at its option, make a cash adjustment or issue fractional Scrip Certificates, in such form and in such denominations as shall from time to time be determined by the Board of Directors. Such Scrip Certificates shall be exchangeable on or before such date or dates as the Board of Directors may determine, when surrendered with other similar Scrip Certificates in sufficient aggregate amounts, for certificates for fully paid and non-assessable full shares of the respective stocks for which such Scrip Certificates are exchangeable, and new Scrip Certificates of a like tenor for the remaining fraction of a share, if any. Such Scrip Certificates shall not entitle any holder thereof to voting rights, dividend rights or any other rights of a stockholder or any rights other than the rights therein set forth, and no dividend or interest shall be payable or shall accrue with respect to Scrip Certificates or the interests represented thereby. All such Scrip Certificates which are not surrendered in exchange for shares of stock on or before their respective expiration dates shall thereafter be void and of no effect whatever.

(3) The minimum amount of capital with which the Corporation will commence business is $1,000.

CERTIFICATE OF DESIGNATIONS
FOR
SERIES A CONVERTIBLE PERPETUAL PREFERRED STOCK
OF
PFIZER INC.

(PURSUANT TO SECTION 151 OF THE DELAWARE CORPORATION LAW)

Pfizer Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the " Corporation "), hereby certifies that the following resolution was adopted by the Board of Directors of the Corporation as required by Section 151 of the General Corporation Law at a meeting duly called and held on July 13, 2002:

This Board hereby RESOLVES that pursuant to the authority granted to and vested in the Board of Directors of this Corporation in accordance with the provisions of the Restated Certificate of Incorporation (" Certificate of Incorporation "), the Board of Directors hereby creates a series of preferred stock of the Corporation, and hereby states the designation and number of shares of such series, and fixes the relative, participating, optional or other special rights, preferences, and limitations thereof as follows:

Series A Convertible Perpetual Preferred Stock:

Section 1. Designation and Amount; Special Purpose Restricted Transfer Issue .(a) The shares of such series shall be designated as shares of "Series A Convertible Perpetual Preferred Stock, no par value per share" (the " Convertible Perpetual Preferred Shares "), and the number of shares constituting such series shall be 7,500. Each Convertible Perpetual Preferred Share shall have a stated value of $40,300.00 per share.

(b) Convertible Perpetual Preferred Shares shall be issued only to Northern Trust Company, its successors and assigns, as trustee (the " Trustee ") of the Pharmacia Savings Plan ESOP Trust for Pharmacia Preferred Stock forming a part of the Pharmacia Corp. Employee Stock Ownership Plan, or any successor to such plan (the " Plan " or " ESOP "). All references to the holder of Convertible Perpetual Preferred Shares shall mean the Trustee or any corporation with which or into which the Trustee may merge or any successor trustee under the trust agreement with respect to the Plan. In the event of any transfer of record ownership of Convertible Perpetual Preferred Shares to any person other than any successor trustee under the Plan, the Convertible Perpetual Preferred Shares so transferred, upon such transfer and without any further action by the Corporation or the holder thereof, shall be automatically converted into shares of Common Stock on the terms otherwise provided for the conversion of Convertible Perpetual Preferred Shares into shares of Common Stock pursuant to Section 5 and no such transferee shall have any of the voting powers, preferences and relative, participating, optional or special rights ascribed to Convertible Perpetual Preferred Shares hereunder but, rather, only the powers and rights pertaining to the Common Stock into which such Convertible Perpetual Preferred Shares shall be so converted. In the event of such a conversion, the transferee of the Convertible Perpetual Preferred Shares shall be treated for all purposes as the record holder of the shares of Common Stock into which such Convertible Perpetual Preferred Shares have been automatically converted as of the date of such transfer. Certificates representing Convertible Perpetual Preferred Shares shall bear a legend to reflect the foregoing provisions. Notwithstanding the foregoing provisions of this Section 1(b), Convertible Perpetual Preferred Shares (i) may be converted into shares of Common Stock as provided by Section 5 and the shares of Common Stock issued upon such conversion may be transferred by the holder thereof as permitted by law and (ii) shall be redeemable by the Corporation upon the terms and conditions provided by Sections 6, 7 and 8.

Section 2. Dividends and Distributions . (a) Subject to the provisions for adjustment hereinafter set forth, the holders of Convertible Perpetual Preferred Shares shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available therefor, cash dividends (" Convertible Perpetual Preferred Dividends ") in an amount per share not to exceed $2,518.75 per share per annum, payable quarterly in arrears, one-quarter on the 1st day of January, one-quarter on the 1st day of April, one-quarter on the 1st day of July and one-quarter on the 1st day of October of each year (each, a " Dividend Payment Date "), to holders of record at the start of business on such Dividend Payment Date. In the event that any Dividend Payment Date shall fall on any day other than a "Business Day" (as hereinafter defined), the dividend payment due on such Dividend Payment Date shall be paid on the Business Day immediately following such Dividend Payment Date. Convertible Perpetual Preferred Dividends shall (i) with respect to the first Dividend Payment date be deemed to accrue on outstanding Convertible Perpetual Preferred Shares from April 1, 2003, the Dividend Payment Date immediately preceding the issuance of the Convertible Perpetual Preferred Shares and (ii) with respect to all other Dividend Payment Dates after the first Dividend Payment Date, accrue from the immediately preceding Dividend Payment Date. Convertible Perpetual Preferred Dividends shall accrue on a daily basis whether or not the Corporation shall have earnings or surplus at the time, but Convertible Perpetual Preferred Dividends accrued after issuance on the Convertible Perpetual Preferred Shares for any period less than a full quarterly period between Dividend Payment Dates (or, in the case of the first dividend payment, from the date of issuance through the first Dividend Payment Date) shall be computed on the basis of a 360-day year of twelve 30-day months. Accrued but unpaid Convertible Perpetual Preferred Dividends shall cumulate as of the Dividend Payment Date on which they first become payable, but no interest shall accrue on accumulated but unpaid Convertible Perpetual Preferred Dividends.

(b) So long as any Convertible Perpetual Preferred Shares shall be outstanding, no dividend shall be declared or paid or set apart for payment on any other series of stock ranking on a parity with the Convertible Perpetual Preferred Shares as to dividends, unless there shall also be or have been declared and paid or set apart for payment on the Convertible Perpetual Preferred Shares dividends for all dividend payment periods of the Convertible Perpetual Preferred Shares ending on or before the dividend payment date of such parity stock, ratably in proportion to the respective amounts of dividends accumulated and unpaid through such dividend period on the Convertible Perpetual Preferred Shares and accumulated and unpaid on such parity stock through the dividend payment period on such parity stock next preceding such dividend payment date. In the event that full cumulative dividends on the Convertible Perpetual Preferred Shares have not been declared and paid or set apart for payment when due, the Corporation shall not declare or pay or set apart for payment any dividends or make any other distributions on, or make any payment on account of the purchase, redemption or other retirement of any other class of stock or series thereof of the Corporation ranking, as to dividends or as to distributions in the event of a liquidation, dissolution or winding-up of the Corporation, junior to the Convertible Perpetual Preferred Shares until full cumulative dividends on the Convertible Perpetual Preferred Shares shall have been paid or declared and set apart for payment; provided, however, that the foregoing shall not apply to (i) any dividend payable solely in any shares of any stock ranking, as to dividends and as to distributions in the event of a liquidation, dissolution or winding-up of the Corporation, junior to the Convertible Perpetual Preferred Shares or (ii) the acquisition of shares of any stock ranking, as to dividends or as to distributions in the event of a liquidation, dissolution or winding-up of the Corporation, junior to the Convertible Perpetual Preferred Shares in exchange solely for shares of any other stock ranking, as to dividends and as to distributions in the event of a liquidation, dissolution or winding-up of the Corporation, junior to the Convertible Perpetual Preferred Shares.

Section 3. Voting Rights . The holders of Convertible Perpetual Preferred Shares shall have the following voting rights:

(a) The holders of Convertible Perpetual Preferred Shares shall be entitled to vote on all matters submitted to a vote of the stockholders of the Corporation, voting together with the holders of Common Stock as one class. The holder of each Convertible Perpetual Preferred Share shall be entitled to a number of votes equal to the number of shares of Common Stock into which such Convertible Perpetual Preferred Share could be converted on the record date for determining the stockholders entitled to vote, rounded to the nearest one one-hundredth of a vote; it being understood that whenever the "Conversion Price" (as defined in Section 5(a)) is adjusted as provided in Section 9, the number of votes of the Convertible Perpetual Preferred Shares shall also be similarly adjusted.

(b) Except as otherwise required by law or set forth herein, holders of Convertible Perpetual Preferred Shares shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for the taking of any corporate action; provided , however , that the vote of at least 66 2/3% of the outstanding Convertible Perpetual Preferred Shares, voting separately as a series, shall be necessary to adopt any alteration, amendment or repeal of any provision of the Restated Certificate of Incorporation of the Corporation (including any such alteration, amendment or repeal effected by any merger or consolidation in which the Corporation is the surviving or resulting corporation), if such amendment, alteration or repeal would alter or change the powers, preferences, or special rights of the Convertible Perpetual Preferred Shares so as to affect them adversely.

Section 4. Liquidation, Dissolution or Winding-Up.

(a) Upon any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, the holders of Convertible Perpetual Preferred Shares shall be entitled to receive out of assets of the Corporation that remain after satisfaction in full of all valid claims of creditors of the Corporation and that are available for payment to stockholders, and subject to the rights of the holders of any stock of the Corporation ranking senior to or on a parity with the Convertible Perpetual Preferred Shares in respect of distributions upon liquidation, dissolution or winding-up of the Corporation, before any amount shall be paid or distributed among the holders of Common Stock or any other shares ranking junior to the Convertible Perpetual Preferred Shares in respect of distributions upon liquidation, dissolution or winding-up of the Corporation, liquidating distributions in the amount of $40,300.00 per share, plus an amount equal to all accrued and unpaid dividends thereon to the date fixed for distribution, and no more. If upon any liquidation, dissolution or winding-up of the Corporation, the amounts payable with respect to the Convertible Perpetual Preferred Shares and any other stock ranking as to any such distribution on a parity with the Convertible Perpetual Preferred Shares are not paid in full, the holders of the Convertible Perpetual Preferred Shares and such other stock shall share ratably in any distribution of assets in proportion to the full respective preferential amounts to which they are entitled. After payment of the full amounts to which they are entitled as provided by the foregoing provisions of this Section 4(a), the holders of Convertible Perpetual Preferred Shares shall not be entitled to any further right or claim to any of the remaining assets of the Corporation.

(b) Written notice of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, stating the payment date or dates when, and the place or places where, the amounts distributable to holders of Convertible Perpetual Preferred Shares in such circumstances shall be payable, shall be given by hand delivery, by courier, by standard form of telecommunication or by first-class mail (postage prepaid), delivered, sent or mailed, as the case may be, not less than 20 days prior to any payment date stated therein, to the holders of Convertible Perpetual Preferred Shares, at the address shown on the books of the Corporation or any transfer agent for the Convertible Perpetual Preferred Shares.

Section 5. Conversion into Common Stock . (a) A holder of shares of Convertible Perpetual Preferred Shares shall be entitled, at any time prior to the close of business on the date fixed for redemption of such shares pursuant to Sections 6, 7 and 8, to cause any or all of such shares to be converted into shares of Common Stock, initially at a conversion price equal to $15.651285 per share of Common Stock, with each Convertible Perpetual Preferred Share being valued at $40,300.00 for such purpose, and which price shall be adjusted as hereinafter provided (and, as so adjusted, is hereinafter sometimes referred to as the "Conversion Price") (that is, a conversion rate initially equivalent to 2,574.8685 shares of Common Stock for each Convertible Perpetual Preferred Share so converted, which is subject to adjustment as the Conversion Price is adjusted as hereinafter provided in Section 9); provided , however , that in no event shall the Conversion Price be less than $1.00.

(b) Any holder of Convertible Perpetual Preferred Shares desiring to convert such shares into shares of Common Stock shall surrender the certificate or certificates representing the Convertible Perpetual Preferred Shares being converted, duly assigned or endorsed for transfer to the Corporation (or accompanied by duly executed stock powers relating thereto), at the principal executive office of the Corporation or the offices of the transfer agent for the Convertible Perpetual Preferred Shares or such office or offices in the continental United States of an agent for conversion as may from time to time be designated by notice to the holders of the Convertible Perpetual Preferred Shares by the Corporation or the transfer agent for the Convertible Perpetual Preferred Shares, accompanied by written notice of conversion. Such notice of conversion shall specify (i) the number of shares of Convertible Perpetual Preferred Shares to be converted and the name or names in which such holder wishes the certificate or certificates for Common Stock and for any Convertible Perpetual Preferred Shares not to be so converted to be issued and (ii) the address to which such holder wishes delivery to be made of such new certificates to be issued upon such conversion.

(c) Upon surrender of a certificate representing a Convertible Perpetual Preferred Share or Shares for conversion, the Corporation shall issue and send by hand delivery, by courier or by first-class mail (postage prepaid) to the holder thereof or to such holder's designee, at the address designated by such holder, a certificate or certificates for the number of shares of Common Stock to which such holder shall be entitled upon conversion. In the event that there shall have been surrendered a certificate or certificates representing Convertible Perpetual Preferred Shares, only part of which are to be converted, the Corporation shall issue and send to such holder or such holder's designee, in the manner set forth in the preceding sentence, a new certificate or certificates representing the number of Convertible Perpetual Preferred Shares which shall not have been converted.

(d) The issuance by the Corporation of shares of Common Stock upon a conversion of Convertible Perpetual Preferred Shares into shares of Common Stock made at the option of the holder thereof shall be effective as of the earlier of (i) the delivery to such holder or such holder's designee of the certificates representing the shares of Common Stock issued upon conversion thereof or (ii) the commencement of business on the second Business Day after the surrender of the certificate or certificates for the Convertible Perpetual Preferred Shares to be converted, duly assigned or endorsed for transfer to the Corporation (or accompanied by duly executed stock powers relating thereto) and accompanied by all documentation required to effect the conversion, as provided herein. On and after the effective date of conversion, the person or persons entitled to receive the Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock, but no allowance or adjustments shall be made in respect of dividends payable to holders of Common Stock in respect of any period prior to such effective date. The Corporation shall not be obligated to pay any dividends that shall have been declared and shall be payable to holders of Convertible Perpetual Preferred Shares on a Dividend Payment Date if the record date for such dividend is subsequent to the effective date of conversion of such shares.

(e) The Corporation shall not be obligated to deliver to holders of Convertible Perpetual Preferred Shares any fractional share of Common Stock issuable upon any conversion of such Convertible Perpetual Preferred Shares, but in lieu thereof may make a cash payment in respect thereof in any manner permitted by law.

(f) The Corporation shall at all times reserve and keep available out of its authorized and unissued Common Stock, solely for issuance upon the conversion of Convertible Perpetual Preferred Shares as herein provided, free from any preemptive rights, such number of shares of Common Stock as shall from time to time be issuable upon the conversion of all the Convertible Perpetual Preferred Shares then outstanding. Nothing contained herein shall preclude the Corporation from issuing shares of Common Stock held in its treasury upon the conversion of Convertible Perpetual Preferred Shares into Common Stock pursuant to the terms hereof. The Corporation shall prepare and shall use its best effort to obtain and keep in force such governmental or regulatory permits or other authorizations as may be required by law, and shall comply with all requirements as to registration or qualification of the Common Stock, in order to enable the Corporation lawfully to issue and deliver to each holder of record of Convertible Perpetual Preferred Shares such number of shares of its Common Stock as from time to time is sufficient to effect the conversion of all Convertible Perpetual Preferred Shares then outstanding and convertible into shares of Common Stock.

Section 6. Redemption At the Option of the Corporation . (a) The Convertible Perpetual Preferred Shares shall be redeemable, in whole or in part, at the option of the Corporation at any time at the redemption price of $40,300.00 per share, plus an amount equal to all accrued and unpaid dividends thereon to the date fixed for redemption. Payment of the redemption price shall be made by the Corporation in cash or shares of Common Stock, or a combination thereof, as permitted by Section 6(e). From and after the date fixed for redemption, dividends on Convertible Perpetual Preferred Shares called for redemption will cease to accrue, such Convertible Perpetual Preferred Shares will no longer be deemed to be outstanding and all rights in respect of such Convertible Perpetual Preferred Shares shall cease, except the right to receive the redemption price. If fewer than all of the outstanding Convertible Perpetual Preferred Shares are to be redeemed, the Corporation shall redeem a portion of the Convertible Perpetual Preferred Shares of each holder determined pro rata based on the number of Convertible Perpetual Preferred Shares held by each holder.

(b) Unless otherwise required by law, notice of redemption will be sent to the holders of Convertible Perpetual Preferred Shares at the address shown on the books of the Corporation or any transfer agent for the Convertible Perpetual Preferred Shares by hand delivery, by courier, by standard form of telecommunication or by first-class mail (postage prepaid) delivered, sent or mailed, as the case may be, not less than twenty (20) days nor more than sixty (60) days prior to the redemption date. Each such notice shall state: (i) the redemption date; (ii) the total number of Convertible Perpetual Preferred Shares to be redeemed and, if fewer than all the shares held by such holder are to be redeemed, the number of such Convertible Perpetual Preferred Shares to be redeemed from such holder; (iii) the redemption price; (iv) whether the redemption price shall be paid in cash or in shares of Common Stock, or in a combination of such Common Stock and cash, as permitted by Section 6(e); (v) the place or places where certificates for such Convertible Perpetual Preferred Shares are to be surrendered for payment of the redemption price; (vi) that dividends on the Convertible Perpetual Preferred Shares to be redeemed will cease to accrue on such redemption date; and (vii) the conversion rights of the Convertible Perpetual Preferred Shares to be redeemed, the period within which conversion rights may be exercised, and the Conversion Price and number of shares of Common Stock issuable upon conversion of a Convertible Perpetual Preferred Share at the time. Upon surrender of the certificate for any Convertible Perpetual Preferred Shares so called for redemption and not previously converted (properly endorsed or assigned for transfer, if the Board shall so require and the notice shall so state), such shares shall be redeemed by the Corporation at the date fixed for redemption and at the redemption price set forth in this paragraph (6).

(c) Within thirty (30) days after the later of (i) the effective date, (ii) the enactment date or (iii) if the Corporation contests in good faith in a judicial or administrative proceeding the legality of the change referred to in this Section 6(c), the date such matter is finally determined (the time for appeal having expired and no appeal having been filed) against the Corporation, of a change in any statute, rule or regulation of the United States of America which has the effect of limiting or making unavailable to the Corporation all or any of the tax deductions for amounts paid (including dividends) on the Convertible Perpetual Preferred Shares when such amounts are used as provided under Section 404(k)(2) of the Internal Revenue Code of 1986, as amended (the " Code ") and in effect on July 21, 1989, the Corporation may, in its sole discretion and notwithstanding anything to the contrary in Section 6(a), elect to either (a) redeem any or all of such Convertible Perpetual Preferred Shares for cash or, if the Corporation so elects, in shares of Common Stock, or a combination of such shares of Common Stock and cash, any such shares of Common Stock to be valued for such purpose at their Fair Market Value (as defined in Section 9(g)), at a redemption price equal to the higher of (x) $40,300.00 per share or (y) the Fair Market Value of the number of shares of Common Stock into which each Convertible Perpetual Preferred Share is convertible at the time the notice of such redemption is given, plus in either case accrued and unpaid dividends thereon to the date fixed for redemption, or (b) exchange any or all of such Convertible Perpetual Preferred Shares for securities of comparable value (as determined by an independent appraiser) that constitute "qualifying employer securities" with respect to a holder of Convertible Perpetual Preferred Shares within the meaning of Section 409(1) of the Code and Section 407(d)(5) of the Employee Retirement Income Security Act of 1974, as amended (" ERISA "), or any successor provisions of law.

(d) In the event that the Plan is terminated or the ESOP is terminated or eliminated from the Plan in accordance with its terms, the Corporation shall, as soon thereafter as practicable, call for redemption all the then outstanding Convertible Perpetual Preferred Shares in accordance with Section 6(a).

(e) The Corporation, at its option, may make payment of the redemption price required upon redemption of Convertible Perpetual Preferred Shares in cash or in shares of Common Stock, or in a combination of such Common Stock and cash, any such shares of Common Stock to be valued for such purposes at their Fair Market Value (as defined in Section 9(g)).

Section 7. Other Redemption Rights . Convertible Perpetual Preferred Shares shall be redeemed by the Corporation for cash or, if the Corporation so elects, in shares of Common Stock, or a combination of such shares of Common Stock and cash, any such shares of Common Stock to be valued for such purpose at their Fair Market Value, at a redemption price of $40,300.00 per share plus accrued and unpaid dividends thereon to the date fixed for redemption, at the option of the holder, at any time and from time to time upon notice to the Corporation given not less than five (5) business days prior to the date fixed by the holder in such notice for such redemption, upon certification by such holder to the Corporation of the following events: (i) when and to the extent necessary for such holder to make any payments of principal, interest or premium due and payable (whether as scheduled, upon acceleration or otherwise) under the note from the Trustee to the Corporation or any indebtedness, expenses or costs incurred by the holder for the benefit of the Plan; or (ii) in the event that the Plan is not initially determined by the Internal Revenue Service to be qualified within the meaning of Sections 401(a) and 4975(e)(7) of the Code. Convertible Perpetual Preferred Shares shall be redeemed by the Corporation for cash or, if the Corporation so elects, in shares of Common Stock, or a combination of such shares of Common Stock and cash, any such shares of Common Stock to be valued for such purpose at their Fair Market Value (as defined in Section 9(g)), at a redemption price equal to the higher of (x) $40,300.00 per share or (y) the Fair Market Value of the number of shares of Common Stock into which each Convertible Perpetual Preferred Share is convertible at the time the notice of such redemption is given, plus in either case accrued and unpaid dividends thereon to the date fixed for redemption, at the option of the holder, at any time and from time to time upon notice to the Corporation given not less than five (5) business days prior to the date fixed by the holder in such notice for such redemption, upon certification by such holder to the Corporation that it is necessary for such holder to provide for distributions required to be made to the Participants under, or to satisfy an investment election of the Participants in accordance with, the Plan.

Section 8. Consolidation, Merger, etc. (a) In the event that the Corporation shall consummate any consolidation or merger or similar business combination, pursuant to which the outstanding shares of Common Stock are exchanged solely for or changed, reclassified or converted solely into stock that constitutes "qualifying employer securities" with respect to a holder of Convertible Perpetual Preferred Shares within the meaning of Section 409(1) of the Code and Section 407(d)(5) of ERISA or any successor provisions of law, and, if applicable, for a cash payment in lieu of fractional shares, if any, the Convertible Perpetual Preferred Shares of such holder shall, in connection with such consolidation, merger or similar business combination, be assumed by and shall become preferred stock of the issuer of such "qualifying employer securities," having in respect of such issuer, insofar as possible, the same powers, preferences and relative, participating, optional or other special rights (including the redemption rights provided by Sections 6, 7 and 8), and the qualifications, limitations or restrictions thereon, that the Convertible Perpetual Preferred Share had immediately prior to such transaction, except that after such transaction each Convertible Perpetual Preferred Share shall be convertible, otherwise on the terms and conditions provided by Section 5, into the number and kind of qualifying employer securities so receivable by a holder of the number of shares of Common Stock into which such Convertible Perpetual Preferred Shares could have been converted immediately prior to such transaction; provided , however , that if by virtue of the structure of such transaction, a holder of Common Stock is required to make an election with respect to the nature and kind of consideration to be received in such transaction, which election cannot practicably be made by the holders of the Convertible Perpetual Preferred Shares, then the Convertible Perpetual Preferred Shares shall, by virtue of such transaction and on the same terms as apply to the holders of Common Stock, be converted into or exchanged for the aggregate amount of stock, securities, cash or other property (payable in kind) receivable by a holder of the number of shares of Common Stock into which such Convertible Perpetual Preferred Shares could have been converted immediately prior to such transaction if such holder of Common Stock failed to exercise any rights of election to receive any kind or amount of stock, securities, cash or other property (other than such qualifying employer securities and a cash payment, if applicable, in lieu of fractional shares) receivable upon such transaction (provided that, if the kind or amount of qualifying employer securities receivable upon such transaction is not the same for each non-electing share, then the kind and amount so receivable upon such transaction for each non-electing share shall be the kind and amount so receivable per share by the plurality of the non-electing shares). The rights of the Convertible Perpetual Preferred Shares as preferred stock of the issuer of such "qualifying employer securities" shall successively be subject to adjustments pursuant to Section 9 after any such transaction as nearly equivalent as practicable to the adjustment provided for by such section prior to such transaction. The Corporation shall not consummate any such merger, consolidation or similar transaction unless all then outstanding Convertible Perpetual Preferred Shares shall be assumed and authorized by the issuer of such "qualifying employer securities" as aforesaid.

(b) In the event that the Corporation shall consummate any consolidation or merger or similar business combination, pursuant to which the outstanding shares of Common Stock are by operation of law exchanged for or changed, reclassified or converted into other stock or securities or cash or any other property, or any combination thereof, other than any such consideration which is constituted solely of qualifying employer securities (as referred to in Section 8(a)) and cash payments, if applicable, in lieu of fractional shares, outstanding Convertible Perpetual Preferred Shares shall, without any action on the part of the Corporation or any holder thereof (but subject to Section 8(c)), be automatically converted by virtue of such merger, consolidation or similar transaction immediately prior to such consummation into the number of shares of Common Stock into which such Convertible Perpetual Preferred Shares could have been converted at such time so that each Convertible Perpetual Preferred Share shall, by virtue of such transaction and on the same terms as apply to the holders of Common Stock, be converted into or exchanged for the aggregate amount of stock, securities, cash or other property (payable in like kind) receivable by a holder of the number of shares of Common Stock into which such Convertible Perpetual Preferred Shares could have been converted immediately prior to such transaction; provided , however , that if by virtue of the structure of such transaction, a holder of Common Stock is required to make an election with respect to the nature and kind of consideration to be received in such transaction, which election cannot practicably be made by the holder of the Convertible Perpetual Preferred Shares, then the Convertible Perpetual Preferred Shares shall, by virtue of such transaction and on the same terms as apply to the holders of Common Stock, be converted into or exchanged for the aggregate amount of stock, securities, cash or other property (payable in kind) receivable by a holder of the number of shares of Common Stock into which such Convertible Perpetual Preferred Shares could have been converted immediately prior to such transaction if such holder of Common Stock failed to exercise any rights of election as to the kind or amount of stock, securities, cash or other property receivable upon such transaction (provided that, if the kind or amount of stock, securities, cash or other property receivable upon such transaction is not the same for each non-electing share, then the kind and amount of stock, securities, cash or other property receivable upon such transaction for each non-electing share shall be the kind and amount so receivable per share by a plurality of the non-electing shares).

(c) In the event the Corporation shall enter into any agreement providing for any consolidation or merger or similar business combination described in Section 8(b), then the Corporation shall as soon as practicable thereafter (and in any event at least ten (10) business days before consummation of such transaction) give notice of such agreement and the material terms thereof to each holder of Convertible Perpetual Preferred Shares and each such holder shall have the right to elect, by written notice to the Corporation, to receive, upon consummation of such transaction (if and when such transaction is consummated), from the Corporation or the successor of the Corporation in redemption and retirement of such Convertible Perpetual Preferred Shares, a cash payment equal to the amount payable in respect of Convertible Perpetual Preferred Shares upon liquidation of the Corporation pursuant to Section 4. No such notice of redemption shall be effective unless given to the Corporation prior to the close of business on the second business day prior to consummation of such transaction, unless the Corporation or the successor of the Corporation shall waive such prior notice, but any notice of redemption so given prior to such time may be withdrawn by notice of withdrawal given to the Corporation prior to the close of business on the fifth business day prior to consummation of such transaction.

Section 9. Anti-dilution Adjustments . (a) In the event the Corporation shall, at any time or from time to time while any of the Convertible Perpetual Preferred Shares are outstanding, (i) pay a dividend or make a distribution in respect of the Common Stock in shares of Common Stock, (ii) subdivide the outstanding shares of Common Stock, or (iii) combine the outstanding shares of Common Stock into a smaller number of shares, in each case whether by reclassification of shares, recapitalization of the Corporation (including a recapitalization effected by a merger or consolidation to which Section 8 does not apply) or otherwise, the Conversion Price in effect immediately prior to such action shall be adjusted by multiplying such Conversion Price by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately before such event, and the denominator of which is the number of shares of Common Stock outstanding immediately after such event. An adjustment made pursuant to this Section 9(a) shall be given effect, upon payment of such a dividend or distribution, as of the record date for the determination of stockholders entitled to receive such dividend or distribution (on a retroactive basis) and in the case of a subdivision or combination shall become effective immediately as of the effective date thereof.

(b) In the event that the Corporation shall, at any time or from time to time while any of the Convertible Perpetual Preferred Shares are outstanding, issue to holders of shares of Common Stock as a dividend or distribution, including by way of a reclassification of shares or a recapitalization of the Corporation, any right or warrant to purchase shares of Common Stock (but not including as such a right or warrant any security convertible into or exchangeable for shares of Common Stock) at a purchase price per share less than the Fair Market Value (as hereinafter defined) of a share of Common Stock on the date of issuance of such right or warrant, then, subject to the provisions of Sections 9(e) and (f), the Conversion Price shall be adjusted by multiplying such Conversion Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately before such issuance of rights or warrants plus the number of shares of Common Stock which could be purchased at the Fair Market Value of a share of Common Stock at the time of such issuance for the maximum aggregate consideration payable upon exercise in full of all such rights or warrants, and the denominator of which shall be the number of shares of Common Stock outstanding immediately before such issuance of rights or warrants plus the number of shares of Common Stock that could be acquired upon exercise in full of all such rights and warrants.

(c) In the event the Corporation shall, at any time or from time to time while any of the Convertible Perpetual Preferred Shares are outstanding, issue, sell or exchange shares of Common Stock (other than pursuant to any right or warrant to purchase or acquire shares of Common Stock (including as such a right or warrant any security convertible into or exchangeable for shares of Common Stock) and other than pursuant to any employee or director incentive or benefit plan or arrangement, including any employment, severance or consulting agreement, of the Corporation or any subsidiary of the Corporation heretofore or hereafter adopted) for a consideration having a Fair Market Value, on the date of such issuance, sale or exchange, less than the Fair Market Value of such shares on the date of issuance, sale or exchange, then, subject to the provisions of Sections 9(e) and (f), the Conversion Price shall be adjusted by multiplying such Conversion Price by a fraction the numerator of which shall be the sum of (i) the Fair Market Value of all the shares of Common Stock outstanding on the day immediately preceding the first public announcement of such issuance, sale or exchange plus (ii) the Fair Market Value of the consideration received by the Corporation in respect of such issuance, sale or exchange of shares of Common Stock, and the denominator of which shall be the product of (a) the Fair Market Value of a share of Common Stock on the day immediately preceding the first public announcement of such issuance, sale or exchange multiplied by (b) the sum of the number of shares of Common Stock outstanding on such day plus the number of shares of Common Stock so issued, sold or exchanged by the Corporation. In the event the Corporation shall, at any time or from time to time while any Convertible Perpetual Preferred Shares are outstanding, issue, sell or exchange any right or warrant to purchase or acquire shares of Common Stock (including as such a right or warrant any security convertible into or exchangeable for shares of Common Stock), other than any such issuance to holders of shares of Common Stock as a dividend or distribution (including by way of a reclassification of shares or a recapitalization of the Corporation) and other than pursuant to any employee or director incentive or benefit plan or arrangement (including any employment, severance or consulting agreement) of the Corporation or any subsidiary of the Corporation heretofore or hereafter adopted, for a consideration having a Fair Market Value, on the date of such issuance, sale or exchange, less than the Non-Dilutive Amount (as hereinafter defined), then, subject to the provisions of Sections 9(e) and (f), the Conversion Price shall be adjusted by multiplying such Conversion Price by a fraction the numerator of which shall be the sum of (I) the Fair Market Value of all the shares of Common Stock outstanding on the day immediately preceding the first public announcement of such issuance, sale or exchange plus (II) the Fair Market Value of the consideration received by the Corporation in respect of such issuance, sale or exchange of such right or warrant plus (III) the Fair Market Value at the time of such issuance of the consideration which the Corporation would receive upon exercise in full of all such rights or warrants, and the denominator of which shall be the product of (i) the Fair Market Value of a share of Common Stock on the day immediately preceding the first public announcement of such issuance, sale or exchange multiplied by (ii) the sum of the number of shares of Common Stock outstanding on such day plus the maximum number of shares of Common Stock which could be acquired pursuant to such right or warrant at the time of the issuance, sale or exchange of such right or warrant (assuming shares of Common Stock could be acquired pursuant to such right or warrant at such time).

(d) In the event the Corporation shall, at any time or from time to time while any of the Convertible Perpetual Preferred Shares are outstanding, make an Extraordinary Distribution (as hereinafter defined) in respect of the Common Stock, whether by dividend, distribution, reclassification of shares or recapitalization of the Corporation (including a recapitalization or reclassification effected by a merger or consolidation to which Section 8 does not apply) or effect a Pro Rata Repurchase (as hereinafter defined) of Common Stock, the Conversion Price in effect immediately prior to such Extraordinary Distribution or Pro Rata Repurchase shall, subject to Sections 9(e) and (f), be adjusted by multiplying such Conversion Price by the fraction, the numerator of which is the difference between (i) the product of (x) the number of shares of Common Stock outstanding immediately before such Extraordinary Distribution or Pro Rata Repurchase multiplied by (y) the Fair Market Value of a share of Common Stock on the day before the ex-dividend date with respect to an Extraordinary Distribution which is paid in cash and on the distribution date with respect to an Extraordinary Distribution which is paid other than in cash, or on the applicable expiration date (including all extensions thereof) of any tender offer which is a Pro Rata Repurchase, or on the date of purchase with respect to any Pro Rata Repurchase which is not a tender offer, as the case may be, and (ii) the Fair Market Value of the Extraordinary Distribution minus the aggregate amount of regularly scheduled quarterly dividends declared by the Board and paid by the Corporation in the twelve months immediately preceding such Extraordinary Distribution or the aggregate purchase price of the Pro Rata Repurchase, as the case may be, and the denominator of which shall be the product of (a) the number of shares of Common Stock outstanding immediately before such Extraordinary Dividend or Pro Rata Repurchase minus, in the case of a Pro Rata Repurchase, the number of shares of Common Stock repurchased by the Corporation multiplied by (b) the Fair Market Value of a share of Common Stock on the day before the ex-dividend date with respect to an Extraordinary Distribution which is paid in cash and on the distribution date with respect to an Extraordinary Distribution which is paid other than in cash, or on the applicable expiration date (including all extensions thereof) of any tender offer which is a Pro Rata Repurchase or on the date of purchase with respect to any Pro Rata Repurchase which is not a tender offer, as the case may be. The Corporation shall send each holder of Convertible Perpetual Preferred Shares (i) notice of its intent to make any dividend or distribution and (ii) notice of any offer by the Corporation to make a Pro Rata Repurchase, in each case at the same time as, or as soon as practicable after, such offer is first communicated (including by announcement of a record date in accordance with the rules of any stock exchange on which the Common Stock is listed or admitted to trading) to holders of Common Stock. Such notice shall indicate the intended record date and the amount and nature of such dividend or distribution, or the number of shares subject to such offer for a Pro Rata Repurchase and the purchase price payable by the Corporation pursuant to such offer, as well as the Conversion Price and the number of shares of Common Stock into which a Convertible Perpetual Preferred Share may be converted at such time.

(e) Notwithstanding any other provision of this Section 9, the Corporation shall not be required to make any adjustment to the Conversion Price unless such adjustment would require an increase or decrease of at least one percent (1%) in the Conversion Price. Any lesser adjustment shall be carried forward and shall be made no later than the time of, and together with, the next subsequent adjustment which, together with any adjustment or adjustments so carried forward, shall amount to an increase or decrease of at least one percent (1%) in the Conversion Price.

(f) If the Corporation shall make any dividend or distribution on the Common Stock or issue any Common Stock, other capital stock or other security of the Corporation or any rights or warrants to purchase or acquire any such security, which transaction does not result in an adjustment to the Conversion Price pursuant to the foregoing provisions of this Section 9, the Board shall consider whether such action is of such a nature that an adjustment to the Conversion Price should equitably be made in respect of such transaction. If in such case the Board determines that an adjustment to the Conversion Price should be made, an adjustment shall be made effective as of such date, as determined by the Board. The determination of the Board as to whether an adjustment to the Conversion Price should be made pursuant to the foregoing provisions of this Section 9(f), and, if so, as to what adjustment should be made and when, shall be final and binding on the Corporation and all shareholders of the Corporation. The Corporation shall be entitled to make such additional adjustments in the Conversion Price, in addition to those required by the foregoing provisions of this Section 9, as shall be necessary in order that any dividend or distribution in shares of capital stock of the Corporation, subdivision, reclassification or combination of shares of stock of the Corporation or any recapitalization of the Corporation shall not be taxable to the holders of the Common Stock.

(g) The following definitions shall apply herein:

"Business Day" shall mean each day that is not a Saturday, Sunday or a day on which state or federally chartered banking institutions in New York are not required to be open.

"Current Market Price" of publicly traded shares of Common Stock or any other class of capital stock or other security of the Corporation or any other issuer for any day shall mean the last reported sales price, regular way, or, in the event that no sale takes place on such day, the average of the reported closing bid and asked prices, regular way, in either case as reported on the New York Stock Exchange Composite Tape or, if such security is not listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which such security is listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the NASDAQ National Market System or, if such security is not quoted on such National Market System, the average of the closing bid and asked prices on each such day in the over-the-counter market as reported by NASDAQ or, if bid and asked prices for such security on each such day shall not have been reported through NASDAQ, the average of the bid and asked prices for such day as furnished by any New York Stock Exchange member firm regularly making a market in such security selected for such purpose by the Board of Directors of the Corporation or a committee thereof.

"Extraordinary Distribution" shall mean any dividend or other distribution to holders of Common Stock (effected while any of the Convertible Perpetual Preferred Shares are outstanding) (i) of cash, where the aggregate amount of such cash dividend or distribution together with the amount of all cash dividends and distributions made during the preceding period of 12 months, when combined with the aggregate amount of all Pro Rata Repurchases (for this purpose, including only that portion of the aggregate purchase price of such Pro Rata Repurchase which is in excess of the Fair Market Value of the Common Stock repurchased as determined on the Business Day immediately following the applicable expiration date (including all extensions thereof) of any tender offer or exchange offer which is a Pro Rata Repurchase, or the date of purchase with respect to any other Pro Rata Repurchase which is not a tender offer or exchange offer made during such period), exceeds ten percent (10%) of the aggregate Fair Market Value of all shares of Common Stock outstanding on the day before the ex-dividend date with respect to such Extraordinary Distribution which is paid in cash and on the distribution date with respect to an Extraordinary Distribution which is paid other than in cash, and/or (ii) of any shares of capital stock of the Corporation (other than shares of Common Stock), other securities of the Corporation (other than securities of the type referred to in Section 9(b) or (c)), evidences of indebtedness of the Corporation or any other person or any other property (including shares of any subsidiary of the Corporation) or any combination thereof. The Fair Market Value of an Extraordinary Distribution for purposes of Section 9(d) shall be equal to the sum of the Fair Market Value of such Extraordinary Distribution plus the amount of any cash dividends which are not Extraordinary Distributions made during such 12-month period and not previously included in the calculation of an adjustment pursuant to Section 9(d).

"Fair Market Value" shall mean, as to shares of Common Stock or any other class of capital stock or securities of the Corporation or any other issuer which are publicly traded, (i) for purposes of Sections 6 and 7, the Current Market Price on the date as of which the Fair Market Value is to be determined, and (ii) for all other purposes hereof, the average of the Current Market Prices of such shares or securities for each day of the Adjustment Period.

"Adjustment Period" shall mean the period of five (5) consecutive trading days preceding, and including, the date as of which the Fair Market Value of a security is to be determined. The Fair Market Value of any security which is not publicly traded (other than the Convertible Perpetual Preferred Shares) or of any other property shall mean the fair value thereof as determined by an independent investment banking or appraisal firm experienced in the valuation of such securities or property selected in good faith by the Board or a committee thereof, or, if no such investment banking or appraisal firm is in the good faith judgment of the Board or such committee available to make such determination, as determined in good faith by the Board or such committee.

"Non-Dilutive Amount" in respect of an issuance, sale or exchange by the Corporation of any right or warrant to purchase or acquire shares of Common Stock (including any security convertible into or exchangeable for shares of Common Stock) shall mean the difference between (i) the product of the Fair Market Value of a share of Common Stock on the day preceding the first public announcement of such issuance, sale or exchange multiplied by the maximum number of shares of Common Stock which could be acquired on such date upon the exercise in full of such rights and warrants (including upon the conversion or exchange of all such convertible or exchangeable securities), whether or not exercisable (or convertible or exchangeable) at such date, and (ii) the aggregate amount payable pursuant to such right or warrant to purchase or acquire such maximum number of shares of Common Stock; provided , however , that in no event shall the Non-Dilutive Amount be less than zero. For purposes of the foregoing sentence, in the case of a security convertible into or exchangeable for shares of Common Stock, the amount payable pursuant to a right or warrant to purchase or acquire shares of Common Stock shall be the Fair Market Value of such security on the date of the issuance, sale or exchange of such security by the Corporation.

"Pro Rata Repurchase" shall mean any purchase of shares of Common Stock by the Corporation or any subsidiary thereof, whether for cash, shares of capital stock of the Corporation, other securities of the Corporation, evidences of indebtedness of the Corporation or any other person or any other property (including shares of a subsidiary of the Corporation), or any combination thereof, effected while any of the Convertible Perpetual Preferred Shares are outstanding, pursuant to any tender offer or exchange offer subject to Section 13(e) of the Securities Exchange Act of 1934, as amended (the " Exchange Act "), or any successor provision of law, or pursuant to any other offer available to substantially all holders of Common Stock; provided , however , that no purchase of shares by the Corporation or any subsidiary thereof made in open market transactions shall be deemed a Pro Rata Repurchase. For purposes of this Section 9(g), shares shall be deemed to have been purchased by the Corporation or any subsidiary thereof "in open market transactions" if they have been purchased substantially in accordance with the requirements of Rule 10b-18 as in effect under the Exchange Act on July 21, 1989, or on such other terms and conditions as the Board or a committee thereof shall have determined are reasonably designed to prevent such purchases from having a material effect on the trading market for the Common Stock.

(h) Whenever an adjustment to the Conversion Price and the related voting rights of the convertible Perpetual Preferred Shares is required hereunder, the Corporation shall forthwith place on file with the transfer agent for the Common Stock and the Convertible Perpetual Preferred Shares, and with the Secretary of the Corporation, a statement signed by two officers of the Corporation stating the adjusted Conversion Price determined as provided herein and the resulting conversion ratio, and the voting rights (as appropriately adjusted), of the Convertible Perpetual Preferred Shares. Such statement shall set forth in reasonable detail such facts as shall be necessary to show the reason and the manner of computing such adjustment, including any determination of Fair Market Value involved in such computation. Promptly after each adjustment to the Conversion Price and the related voting rights of the Convertible Perpetual Preferred Shares, the Corporation shall mail a notice thereof and of the then prevailing conversion ratio to each holder of Convertible Perpetual Preferred Shares.

Section 10. Ranking; Attributable Capital and Adequacy of Surplus; Retirement of Shares . (a) The Convertible Perpetual Preferred Shares shall rank senior to the Common Stock as to the payment of dividends and the distribution of assets on liquidation, dissolution and winding-up of the Corporation, and, unless otherwise provided in the Restated Certificate of Incorporation of the Corporation, as the same may be amended, or a Certificate of Designations relating to a subsequent series of Preferred Stock, no par value per share, of the Corporation, the Convertible Perpetual Preferred Shares shall rank junior to all series of the Corporation's Preferred Stock, no par value per share, as to the payment of dividends and the distribution of assets on liquidation, dissolution or winding-up.

(b) In addition to any vote of stockholders required by law or by Section 3(b), the vote of the holders of a majority of the outstanding Convertible Perpetual Preferred Shares shall be required to increase the par value of the Common Stock or otherwise increase the capital of the Corporation allocable to the Common Stock for the purpose of the General Corporation Law if, as a result thereof, the surplus of the Corporation for purposes of the General Corporation Law would be less than the amount of Convertible Perpetual Preferred Dividends that would accrue on the then outstanding Convertible Perpetual Preferred Shares during the following three years.

(c) Any Convertible Perpetual Preferred Shares acquired by the Corporation by reason of the conversion or redemption of such shares as provided by Sections 5, 6, 7 and 8, or otherwise so acquired, shall be retired as Convertible Perpetual Preferred Shares and restored to the status of authorized but unissued shares of Preferred Stock, no par value per share, of the Corporation, undesignated as to series, and may thereafter be reissued as part of a new series of such Preferred Stock as permitted by law.

Section 11. Miscellaneous . (a) All notices referred to in Sections 4, 5, 6, 7, 8 and 9 shall be in writing, and all notices hereunder shall be deemed to have been given upon the earlier of delivery thereof if by hand delivery, by courier or by standard form of telecommunication or three (3) Business Days after the mailing thereof if sent by registered mail (unless first-class mail shall be specifically permitted for such notice under the terms of Sections 4 and 6) with postage prepaid, addressed: (i) if to the Corporation, to its office at 235 East 42 ^nd Street, New York, N.Y. 10017 (Attention: Secretary), or to the transfer agent for the Convertible Perpetual Preferred Shares, or other agent of the Corporation designated as permitted by Section 2 or (ii) if to any holder of the Convertible Perpetual Preferred Shares or Common Stock, as the case may be, to such holder at the address of such holder as listed in the stock record books of the Corporation (which may include the records of any transfer agent for the Convertible Perpetual Preferred Shares or Common Stock, as the case may be) or (iii) to such other address as the Corporation or any such holder, as the case may be, shall have designated by notice similarly given.

(b) The term "Common Stock" as used herein and in Sections 1, 3, 4, 5, 6, 7, 8, 9 and 10 means the Corporation's Common Stock, par value $0.05 per share, as the same exists at the date of filing of a Certificate of Designations relating to Convertible Perpetual Preferred Shares or any other class of stock resulting from successive changes or reclassifications of such Common Stock consisting solely of changes in par value, or from par value to no par value, or from no par value to par value. In the event that, at any time as a result of an adjustment made pursuant to Section 9, the holder of any Convertible Perpetual Preferred Shares upon thereafter surrendering such shares for conversion, shall become entitled to receive any shares or other securities of the Corporation other than shares of Common Stock, the Conversion Price in respect of such other shares or securities so receivable upon conversion of Convertible Perpetual Preferred Shares shall thereafter be adjusted, and shall be subject to further adjustment from time to time, in a manner and on terms as nearly equivalent as practicable to the provisions with respect to Common Stock contained in Section 9, and the provisions of Sections 1 through 8, 10 and 11 with respect to the Common Stock shall apply on like or similar terms to any such other shares or securities.

(c) The Corporation shall pay any and all stock transfer and documentary stamp taxes that may be payable in respect of any issuance or delivery of Convertible Perpetual Preferred Shares or shares of Common Stock or other securities issued on account of Convertible Perpetual Preferred Shares pursuant hereto or certificates representing such shares or securities. The Corporation shall not, however, be required to pay any such tax which may be payable in respect of any transfer involved in the issuance or delivery of Convertible Perpetual Preferred Shares or Common Stock or other securities in a name other than that in which the Convertible Perpetual Preferred Shares with respect to which such shares or other securities are issued or delivered were registered, or in respect of any payment to any person with respect to any such shares or securities other than a payment, to the registered holder thereof, and shall not be required to make any such issuance, delivery or payment unless and until the person otherwise entitled to such issuance, delivery or payment has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid or is not payable.

(d) In the event that a holder of Convertible Perpetual Preferred Shares shall not by written notice designate the name in which shares of Common Stock to be issued upon conversion of such shares should be registered or to whom payment upon redemption of Convertible Perpetual Preferred Shares should be made or the addresses to which the certificate or certificates representing such shares, or such payment, should be sent, the Corporation shall be entitled to register such shares and make such payment, in the name of the holder of such Convertible Perpetual Preferred Shares as shown on the records of the Corporation and to send the certificate or certificates representing such shares, or such payment, to the address of such holder shown on the records of the Corporation.

(e) Unless otherwise provided in the Restated Certificate of Incorporation, as the same may be amended, of the Corporation, all payments in the form of dividends, distributions on voluntary or involuntary dissolution, liquidation or winding-up or otherwise made upon the Convertible Perpetual Preferred Shares and any other stock ranking on a parity with the Convertible Perpetual Preferred Shares with respect to such dividend or distribution shall be pro rata , so that amounts paid per Convertible Perpetual Preferred Share and such other stock shall in all cases bear to each other the same ratio that the required dividends, distributions or payments, as the case may be, then payable per share on the Convertible Perpetual Preferred Share and such other stock bear to each other.

(f) Any determination required or permitted to be made by the Board hereunder may be made by a committee appointed by the Board which need not include members of the Board.

(g) The Corporation may appoint, and from time to time discharge and change, a transfer agent for the Convertible Perpetual Preferred Shares. Upon any such appointment or discharge of a transfer agent, the Corporation shall send notice thereof by hand delivery, by courier, by standard form of telecommunication or by first-class mail (postage prepaid), to each holder of record of Convertible Perpetual Preferred Shares.

FIFTH: The private property of the stockholders shall not be subject to the payment of corporate debts to any extent whatever.

SIXTH: The Corporation shall have perpetual existence.

SEVENTH: The following provisions are inserted for the management of the business and for the conduct of the affairs of the Corporation, and it is expressly provided that the same are intended to be in furtherance and not in limitation or exclusion of the powers conferred by statute:

(1) The number of directors of the Corporation (exclusive of directors (the "Preferred Stock Directors") who may be elected by the holders of any one or more series of Preferred Stock which may at any time be outstanding, voting separately as a class or classes) shall not be less than ten nor more than twenty-four, the exact number within said limits to be fixed from time to time solely by resolution of the Board of Directors, acting by not less than a majority of the directors then in office.

(2) Election of directors need not be by ballot unless the By-laws so provide.

(3) Subject to the rights of the holders of any one or more series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of directors or any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other cause shall be filled solely by the Board of Directors, acting by not less than a majority of the Directors then in office, although less than a quorum. Any director so chosen shall hold office until his successor shall be elected and qualified. No decrease in the number of directors shall shorten the term of any incumbent director.

(4) Deleted.

(5) The By-laws may prescribe the number of directors necessary to constitute a quorum and such number may be less than a majority of the total number of directors, but shall not be less than one-third of the total number of directors.

(6) Both shareholders and directors shall have power, if the By-laws of the Corporation so provide, to hold their meetings either within or without the State of Delaware, to have one or more offices in addition to the principal office in the State of Delaware, and to keep the books of the Corporation (subject to the provisions of the statutes) outside of the State of Delaware at such places as may from time to time be designated by them.

(7) The Board of Directors shall have power to determine from time to time whether and if allowed under what conditions and regulations the accounts, and except as otherwise provided by statute or by this Certificate of Incorporation, the books of the Corporation shall be open to the inspection of the shareholders, and the shareholders' rights in this respect are and shall be restricted or limited accordingly, and no shareholder shall have any right to inspect any account or book or document of the Corporation except as conferred by statute or by this Certificate of Incorporation, or authorized by the Board of Directors or by a resolution of the shareholders.

(8) The Board of Directors shall have the power to adopt, amend or repeal the By-laws of the Corporation.

(9) The Board of Directors acting by a majority of the whole board shall have power to appoint three or more of their number to constitute an Executive Committee, which Committee shall, when the Board of Directors is not in session and subject to the By-laws, have and exercise any or all of the powers of the Board of Directors in the management of the business and affairs of the Corporation and shall have power to authorize the seal of the Corporation to be affixed to all papers which may require it. The Board of Directors acting by a majority of the whole board shall also have power to appoint any other committee or committees, such committees to have and exercise such powers as shall be conferred by the Board of Directors or be authorized by the By-laws.

(10) Except as may be otherwise provided by statute or in this Certificate of Incorporation, the business and affairs of this Corporation shall be managed under the direction of the Board of Directors.

(11) Directors, for their services as such, may be paid such compensation as may be fixed from time to time by the Board of Directors.

(12) The Board of Directors shall have power from time to time to fix and determine and vary the amount of the working capital of the Corporation and, subject to any restrictions contained in the Certificate of Incorporation, to direct and determine the use and disposition of any surplus over and above the capital stock paid in, and in its discretion to use and apply any such surplus in purchasing or acquiring property, bonds or other obligations of the Corporation or shares of its own capital stock, to such extent and in such manner and upon such terms as the Board of Directors shall deem expedient, but any shares of such capital stock so purchased or acquired may be resold unless such shares shall have been retired in the manner provided by law for the purpose of decreasing the Corporation's capital stock.

(13) Notwithstanding any other provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class of capital stock of the Corporation as are entitled to vote generally in the election of directors ("Voting Stock") required by law or this Certificate of Incorporation, the affirmative vote of the holders of at least 80% of all of the then outstanding shares of Voting Stock, voting together as a single class, shall be required to alter, amend or repeal paragraphs (1),(3),(5), (8), (10) or this paragraph (13) of this Article SEVENTH.

(14) The liability of the Corporation's Directors to the Corporation or its shareholders shall be eliminated to the fullest extent permitted by the Delaware General Corporation Law as amended from time to time. No amendment to or repeal of this paragraph (14) of Article SEVENTH shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal.

Notwithstanding any other provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class of Voting Stock required by law or this Certificate of Incorporation, the affirmative vote of the holders of at least 80% of all of the then outstanding shares of Voting Stock, voting together as a single class, shall be required to alter, amend or repeal this paragraph (14) of this Article SEVENTH.

(15) Any action required or permitted to be taken by the shareholders of the Corporation must be effected solely at a duly called annual or special meeting of such holders and may not be effected by any consent in writing by such holders.

EIGHTH:

A. Applicability of Article.

Except as otherwise expressly provided in Section C of this Article EIGHTH, none of the actions or transactions listed below shall be effected by the Corporation, or approved by the Corporation as a shareholder of any majority-owned subsidiary of the Corporation if, as of the record date for the determination of the shareholders entitled to vote thereon, any Related Person (as hereinafter defined) exists, unless the applicable requirements of Sections B, C, D, E and F of this Article EIGHTH are fully complied with:

(1) any merger or consolidation of the Corporation or any of its subsidiaries into or with such Related Person;

(2) any sale, lease, exchange or other disposition of all or any substantial part of the assets of the Corporation or any of its majority-owned subsidiaries to or with such Related Person;

(3) the issuance or delivery of any Voting Stock, or securities convertible into or exchangeable or exercisable for any Voting Stock, or of voting securities of any of the Corporation's majority-owned subsidiaries to such Related Person in exchange for cash, other assets or securities, or a combination thereof; or

(4) any voluntary dissolution or liquidation of the Corporation.

B. Stockholder Vote Required.

The actions and transactions described in Section A of this Article EIGHTH shall have been authorized by the affirmative vote of at least 80% of all of the outstanding shares of Voting Stock, voting together as a single class.

C. Minimum Price Required.

Notwithstanding Section B hereof, the 80% voting requirement shall not be applicable if (1) any action or transaction specified in Section A hereof is approved by the Corporation's Board of Directors and by a majority of the Continuing Directors (as hereinafter defined); provided, however, that if there are not at least five Continuing Directors this exception for approval by the Board of Directors shall not be applicable or (2) in the case of any action or transaction pursuant to which the holders of the capital stock of the Corporation are entitled to receive cash, property, securities or other consideration, the cash or fair market value of the property, securities or other consideration to be received per share by holders of the capital stock of the Corporation in such action or transaction is not less than the higher of (a) the highest price per share paid by the Related Person in acquiring any of its holdings of capital stock of the Corporation, or (b) the highest closing sale price on any day either since the Related Person acquired its first share of capital stock of the Corporation which it continues to own or control or during the five years preceding the date of consideration of the action or transaction by the Corporation's Board of Directors, whichever period is shorter; such highest closing sale price shall be determined by the reports of closing sale prices on the Composite Tape for New York Exchange Listed Stocks or, if such stock is not quoted on the Composite Tape on the New York Stock Exchange or other principal United States securities exchange on which such stock is listed or, for any period when such stock is not listed on any such exchange, the highest closing bid quotation with respect to a share of such stock on the National Association of Securities Dealers, Inc. Automated Quotation System; such price, in either case (a) or (b), to be proportionately adjusted for any subsequent increase or decrease in the number of issued shares of the Corporation's capital stock resulting from a subdivision or consolidation of shares or any other capital adjustments, the payment of a stock dividend, or other increase or decrease in such shares of capital stock effected without receipt of consideration by the Corporation.

D. Restrictions on Certain Actions.

After becoming a Related Person and prior to consummation of such action or transaction (1) such Related Person shall not have acquired from the Corporation or any of its majority-owned subsidiaries any newly issued or treasury shares of capital stock or any newly issued securities convertible into or exchangeable for capital stock of the Corporation or any of its majority-owned subsidiaries, directly or indirectly (except upon conversion or exchange of convertible or exchangeable securities acquired by it prior to becoming a Related Person or as a result of a pro rata stock dividend or stock split or other distribution of stock to all shareholders pro rata); (2) such Related Person shall not have received the benefit directly or indirectly (except proportionately as a shareholder) of any loans, advances, guarantees, pledges or other financial assistance or tax credits provided by the Corporation or any of its majority-owned subsidiaries, or made any major changes in the Corporation's or any of its majority-owned subsidiaries' businesses or capital structures or reduced the current rate of dividends payable on the Corporation's capital stock below the rate in effect immediately prior to the time such Related Person became a Related Person (the current rate of dividends being the ratio of the current dividend to the net income of the Corporation for the full fiscal quarter immediately preceding the quarter in which such dividend is paid; and the rate of dividends in effect immediately prior to the time such Related Person became a Related Person being the ratio of (a) the aggregate dividends paid during the four full fiscal quarters immediately preceding the time such Related Person became a Related Person to (b) the aggregate net income of the Corporation for the four successive full fiscal quarters immediately preceding the last quarter in which such dividends were paid); and (3) such Related Person shall have taken all required actions to ensure that the Corporation's Board of Directors includes representation by Continuing Directors (as hereinafter defined) at least proportionate to the stockholdings of the Corporation's remaining public shareholders (as hereinafter defined), with a Continuing Director to occupy any Board position resulting from a fraction and, in any event, with at least one Continuing Director to serve on the Board so long as there are any remaining public shareholders.

E. Proxy Statement Required.

A proxy statement responsive to the requirements of the Securities Exchange Act of 1934, as amended, whether or not the Corporation is then subject to such requirements, shall be mailed to the shareholders of the Corporation for the purpose of soliciting shareholder approval of such action or transaction and shall contain at the front thereof, in a prominent place, any recommendations as to the advisability or inadvisability of the action or transaction which the Continuing Directors may choose to state.

F. Certain Definitions.

For the purpose of this Article EIGHTH, (1) the term "Related Person" shall mean any other corporation, person or entity (including any Affiliate thereof), other than this Corporation, any of its subsidiaries or any officer or employee thereof who holds only voting power pursuant to proxies which beneficially owns or controls, directly or indirectly, 10% or more of the outstanding shares of Voting Stock, (2) a Related Person shall be deemed to own or control, directly or indirectly, any outstanding shares of Voting Stock owned by it of record or beneficially, including without limitation shares (a) which it has the right to acquire pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or otherwise or (b) which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (a) above), by any other corporation, person or other entity (x) with which it or its Affiliate or Associate (as hereinafter defined) has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of Voting Stock or (y) which is its "Affiliate" (other than the Corporation) or "Associate" (other than the Corporation) as those terms are defined in the General Rules and Regulations under the Securities Exchange Act of 1934, as amended; (3) the term "Voting Stock" shall mean such shares of capital stock of the Corporation as are entitled to vote generally in the election of directors; (4) the term "Continuing Director" shall mean a director who was a member of the Board of Directors of the Corporation immediately prior to the time that any Related Person involved in the proposed action or transaction became a Related Person or a director nominated by a majority of the remaining Continuing Directors; and (5) the term "remaining public shareholders" shall mean the holders of the Corporation's capital stock other than the Related Person.

G. Determinations by the Board of Directors.

The Board of Directors of the Corporation shall have the power and duty to determine for the purposes of this Article EIGHTH, on the basis of information then known to the Board of Directors, whether (1) any Related Person exists or is an Affiliate or an Associate of another and (2) any proposed sale, lease, exchange, or other disposition of part of the assets of the Corporation or any majority-owned subsidiary involves a substantial part of the assets of the Corporation or any of its subsidiaries. Any such determination by the Board of Directors shall be conclusive and binding for all purposes.

H. Alteration, Amendment or Repeal.

NINTH: The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation in the manner now or hereafter prescribed by statute and all rights conferred upon the stockholders herein are granted subject to this reservation.

IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be affixed hereto and this certificate to be signed by its Secretary - Vice President Corporate Governance and attested by its Assistant Secretary this 12th day of April, 2004.

PFIZER INC.

By: /s/ Margaret M. Foran

Name: Margaret M. Foran

Title: Secretary - Vice President Corporate Governance

[Corporate Seal]

Attest:

By: /s/ Kathleen M. Ulrich

Kathleen M. Ulrich
Assistant Secretary