Filed by Pfizer Inc.
pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant Rule 14a-12
of the Securities Exchange Act of 1934
Commission File No: 001-02516
Subject Company: Pharmacia Corp.
Article from Pfizer newsletter disseminated to Pfizer employees through its
internal intranet:
AT MEETING WITH PHARMACIA COLLEAGUES, MCKINNELL SAYS "THIS COMBINATION MAKES
COMPELLING STRATEGIC SENSE"
SEPTEMBER 10, 2002
HANK MCKINNELL AND THE ENTIRE PFIZER LEADERSHIP TEAM TRAVELED
TO PHARMACIA HEADQUARTERS IN PEAPACK, NEW JERSEY, LAST FRIDAY FOR A "TOWN HALL"
MEETING THAT WAS VIEWED BY THOUSANDS OF PHARMACIA COLLEAGUES AROUND THE WORLD.
THE MEETING FEATURED SPEECHES FROM MCKINNELL AND PHARMACIA CEO FRED HASSAN, BUT
THE BULK OF THE TIME WAS SPENT ANSWERING QUESTIONS FROM THE AUDIENCE. HERE ARE
SOME OF THE HIGHLIGHTS.
PEAPACK, New Jersey -- To say that interest in Pfizer running
high among Pharmacia colleagues may be the understatement of the summer On the
day the acquisition was announced, for example, Pharmacia experienced a
five-fold increase in traffic to its Intranet -- a surge that actually crashed
many of its servers -- as colleagues rushed to find more information But
opportunities to hear directly from Pfizer executives -- much less to actually
see them -- have been limited.
All that changed last Friday, when 800 colleagues at Pharmacia
headquarters in Peapack, New Jersey, and approximately 15,000 more tuning in
from 75 countries around the world, were given the opportunity to see and hear
from Pfizer's leadership team.
The town hall meeting began with Pharmacia Chairman and CEO
Fred Hassan thanking his colleagues for "continuing to do a good job under
stressful circumstances. . . All of our engines are firing . . . You are showing
us what you're made of." Commenting on the transition, he said, "We are making a
lot of progress. But we also know that different parts of a complex transition
move at different speeds . . . We need to be realistic and accept that this kind
of process always involves some ambiguity."
Hassan then introduced Hank McKinnell, saying, "Hank is
someone who has earned great respect through his successful leadership of
Pfizer."
McKinnell thanked Hassan for his leadership of Pharmacia,
which he called "one of the world's great companies." After introducing the
Pfizer Leadership Team, McKinnell wasted little time in getting to the heart of
the concerns that many Pharmacia colleagues have about the acquisition.
"I realize that if you are a long-time Pharmacia colleague,
this may not be welcome news," he said. "All of you take tremendous pride in
your work, and that passion for performance is one of the reasons why Pfizer was
attracted to Pharmacia in the first place. Some of you may now feel frustrated
and angry . . . feeling jeopardized by a loss of your position or corporate
identity. Even if you feel pretty good about this combination, you probably have
a funny feeling in the pit of your stomach. All of these feelings are legitimate
and understandable. Change - even positive change - is difficult."
McKinnell acknowledged that Pfizer did not yet have answers to
many of the most pressing questions on colleagues' minds -- about job loss and
site closures, for example. But he pledged to work toward getting those answers
as soon as possible. "I have a simple, but inflexible rule," he said, "Analysis
first, then decision, then approval, then announcement. Everybody seems to want
to start at the other end, but we can't do that."
Like Hassan, McKinnell said that transition planning is off to
a great start. "Both Pfizer and Pharmacia have learned that in situations like
this that time may be our greatest enemy," he stated. "Making decisions both
carefully and quickly will bring down the anxiety levels in both organizations,
clarify roles and responsibilities, and get the new organization up and running
as a unified company on Day One."
THE THREE `TELL-ME'S'
McKinnell then-spoke about the acquisition from the
perspective of Pharmacia colleagues, addressing what he referred to as the
three "tell me's":
1. TELL ME WHY PFIZER IS JOINING PHARMACIA.
McKinnell said that both companies can progress much further
and much faster together than alone, adding "therapeutic area by therapeutic
area, region by region, this combination makes compelling strategic sense." For
example, McKinnell said that Pharmacia would fill a "huge gap" for Pfizer in
cancer, giving the company instant access to an established franchise in this
important therapeutic area that we were planning to build from the ground up.
"By coming together," McKinnell said, "we can shave years off our plans to move
toward very specific leadership targets," such as becoming number one in
treating cancer, in every major pharmaceutical market worldwide, and in the
animal health business.
McKinnell said the acquisition will also help Pfizer better
manage the "huge and growing" risks facing pharmaceutical companies today. These
risks include skyrocketing drug development costs fast approaching $1 billion
per compound, as it becomes harder and harder to win regulatory approval for new
medicines -- even those considered sure things. The industry is also facing an
increasingly hostile political climate, even in places like New Jersey and
Michigan where Pfizer and Pharmacia employ thousands of people. The Pharmacia
deal will improve our ability to "get our story heard," helping us to better
serve "those who depend on us, work with us, and invest in us."
McKinnell summed up this "tell me" by saying, "Greater, faster
progress; better risk management -- that's what this combination is about in one
sentence."
-2-
2. TELL ME WHY PFIZER IS A GREAT PLACE TO WORK.
McKinnell said that Pfizer's culture "is a lot like
Pharmacia's. Our values are nearly identical. Our commitment to integrity arid
quality is the same. How we expect leaders to act is just about a perfect
match." He went on to describe recent efforts at Pfizer "to create a more
inclusive environment, to stimulate more open, candid discussion, to do more to
develop people, and to build the leadership qualities of everyone in the Pfizer
organization." Pfizer's culture will continue to evolve, he said, as the best
aspects of both companies' cultures emerge in the combined company.
"We will continue to press for continuous improvement in
Pfizer's culture," he said, "to move away from the outmoded thinking that
leaders only reside at the top of the organization. Everyone at Pfizer can `find
a way to lead.' Arid in the expanded Pfizer, the opportunities for leadership
will be amazing."
3. TELL ME WHAT ALL THIS MEANS FOR ME.
McKinnell acknowledged that not everyone from Pharmacia has a
long-tern future with Pfizer. "That's painful, I understand that," he said,
adding, "I am challenging our leadership throughout the company to find ways to
place as many Pharmacia people in the new organization as we logically can."
For the many Pharmacia colleagues that will continue at
Pfizer, McKinnell said, "You will join the world's largest and fastest-growing
major pharmaceutical company. Together, we will build a company that truly moves
beyond number one."
QUESTIONS AND ANSWERS
The first question concerned the transition process and its
current status. Pfizer's Chief Financial Officer David Shedlarz, who is leading
the process for Pfizer, said that he and the now more than 600 colleagues from
both companies directly involved with the transition "well understand the
awesome responsibility that's been put on our shoulders to do the transition in
a definitive, respectful, and correct way." Shedlarz said that the transition
teams were spending a lot of time initially "simply getting to know each other"
and taking a close look at the issues and opportunities presented by the
combination. He added that the time between now and the close will be used to
"carefully analyze the opportunities on behalf of colleagues in both companies."
McKinnell was asked about his business philosophy and what it
takes to succeed at Pfizer, prompting him to reflect upon the company's journey
from #14 in the industry at the beginning of the 1990s to #1 at the end of the
decade. The key, he said, was an adherence to a set of values codified in the
mid-1990s, but present in the company for many years before that. McKinnell
spoke about how past leaders of the company personified particular values --
Jack Powers and integrity, for example, or Ed Pratt and community. More
recently, Pfizer has moved beyond values and established a set of leader
behaviors, which he described as "what we expect to see in people, day in and
day out." McKinnell said that people who succeed at Pfizer are those who adhere
to the company's values and leader behaviors, but also those who understand "how
important what we do is to millions and millions of people."
-3-
Peter Corr, Pfizer's senior vice president for Science &
Technology, was asked to assess Pharmacia's pipeline. He cautioned that, because
the two companies remain independent competitors, he has had limited opportunity
to review Pharmacia's early stage pipeline, but stated that, based on public
information, he is excited about the prospects.
"One of the things that strikes us," Corr said, "is how well
it complements the pipeline within Pfizer." For example Corr talked about
Pharmacia's leadership in ophthalmology -- a category that Pfizer currently has
no presence in -- and expressed his belief that "there are agents from other
therapeutic areas which can be used in treating ophthalmological diseases." Corr
cited cancer compounds in our pipeline that inhibit angiogenisis, or blood
vessel growth to tumors -- the same basic mechanism underlying many diseases of
the eye, such as age-related macular degeneration.
Several questions concerned the magnitude of the job loss
Pharmacia colleagues are facing and how decisions about jobs will be made.
McKinnell stressed that, while jobs would be lost as a result of the
combination, "there is an enormous difference in consolidating two organizations
that are not growing versus consolidating organizations that are growing very
rapidly." Since Pfizer and Pharmacia are both high-growth companies, McKinnell
said, cost savings can come not only from eliminating positions, but also from
not hiring the people both companies would have been bringing on board in order
to meet their growth targets.
Rob Norton, senior vice president, Corporate Human Resources,
emphasized that the Pharmacia leadership team is heavily involved in the talent
planning process. He also said that Pfizer had frozen hiring to make way for as
many Pharmacia colleagues as possible. In a growing company the size of Pfizer,
Norton said, a hiring freeze in and of itself "generates a lot of flexibility."
As to when the acquisition will be completed, McKinnell said
that he hoped it would be by the end of the year. Pfizer's General Counsel Jeff
Kindler said that good progress was being made with antitrust regulators in both
the United States and the European Commission. "There are issues that have
arisen, but none that we think are going to be material or problematic . . .
We see everything going well and staying on track."
McKinnell said that Pfizer would continue to support
philanthropic activities that were important to Pharmacia, and would support
Pharmacia colleagues who donate their time and money to community organizations.
"We were recently named the most generous company in the U.S.," he said. "We are
very proud of that."
The final question concerned Pfizer's values and leader
behaviors and how they match up with those of Pharmacia. Listing several of the
Pfizer values, McKinnell said, "This isn't foreign to you. This is how you live
and work every day." He closed by saying, "The idea of teamwork, the idea of
open discussion and debate, the idea of building a diverse organization -- to
me, those are the key ingredients that I can encourage to happen, not only in
the Pfizer organization, but, looking forward, in the combined Pfizer-Pharmacia
organization."
* * * *
-4-
SAFE HARBOR STATEMENT
---------------------
THIS RELEASE CONTAINS CERTAIN "FORWARD-LOOKING" STATEMENTS WITHIN THE MEANING OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THESE STATEMENTS ARE BASED
ON MANAGEMENT'S CURRENT EXPECTATION AND ARE NATURALLY SUBJECT TO UNCERTAINTY AND
CHANGES IN CIRCUMSTANCES. ACTUAL RESULTS MAY VARY MATERIALLY FROM THE
EXPECTATIONS CONTAINED HEREIN. THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN
INCLUDE STATEMENTS ABOUT FUTURE FINANCIAL OPERATING RESULTS AND BENEFITS OF THE
PENDING MERGER BETWEEN PFIZER INC. AND PHARMACIA CORP. FACTORS THAT COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE DESCRIBED HEREIN INCLUDE: THE
INABILITY TO OBTAIN SHAREHOLDER OR REGULATORY APPROVALS; ACTIONS OF THE U.S.,
FOREIGN AND LOCAL GOVERNMENTS; THE INABILITY TO SUCCESSFULLY INTEGRATE THE
BUSINESSES OF PFIZER INC. AND PHARMACIA CORP.; COSTS RELATED TO THE MERGER; THE
INABILITY TO ACHIEVE COST-CUTTING SYNERGIES RESULTING FROM THE MERGER; CHANGING
CONSUMER OR MARKETPLACE TRENDS: AND THE GENERAL ECONOMIC ENVIRONMENT. NEITHER
PFIZER INC. NOR PHARMACIA CORP. IS UNDER ANY OBLIGATION TO (AND EXPRESSLY
DISCLAIMS ANY SUCH OBLIGATION TO) UPDATE OR ALTER ITS FORWARD-LOOKING
STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS, OR OTHERWISE.
WE URGE INVESTORS TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT
DOCUMENTS THAT PFIZER INC. AND PHARMACIA CORP. HAVE FILED AND WILL FILE WITH THE
SECURITIES AND EXCHANGE COMMISSION BECAUSE THEY CONTAIN IMPORTANT INFORMATION.
Pfizer and Pharmacia will file a proxy statement/prospectus and other relevant
documents concerning the proposed merger transaction with the SEC. INVESTORS ARE
URGED TO READ THE PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE AND ANY
OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. You will be able to obtain the documents free of charge at the
website maintained by the SEC at www.sec.gov. In addition, you may obtain
documents filed with the SEC by Pfizer free of charge by requesting them in
writing from Pfizer Inc., 235 East 42nd Street, New York, New York 10017,
Attention: Investor Relations, telephone: (212) 573-2668. You may obtain
documents filed with the SEC by Pharmacia free of charge by requesting them in
writing from Pharmacia Investor Relations, Route 206 North, Peapack, New Jersey
07977, or by telephone at (908) 901-8000.
Pfizer and Pharmacia, and their respective directors and executive officers and
other members of their management and employees, may be deemed to be
participants in the solicitation of proxies from the stockholders of Pfizer and
Pharmacia in connection with the merger. Information about the directors and
executive officers of Pfizer and their ownership of Pfizer shares is set forth
in the proxy statement for Pfizer's 2002 annual meeting of shareholders.
Information about the directors and executive officers of Pharmacia and their
ownership of Pharmacia stock is set forth in the proxy statement for Pharmacia's
2002 annual meeting of stockholders. Investors may obtain additional information
regarding the interests of such participants by reading the proxy
statement/prospectus when its becomes available.
-5-