Pfizer Inc: Pfizer & Warner-Lambert Agree to $90 = Billion Merger

For immediate release
February 7, 2000

PFIZER AND=20 WARNER-LAMBERT
AGREE TO $90 BILLION MERGER
CREATING THE = WORLD'S=20 FASTEST-GROWING
MAJOR PHARMACEUTICAL = COMPANY
---

Warner-Lambert Shareholders = to=20 Receive 2.75 Pfizer Shares for Each Warner-Lambert Share, Valued = at $98.31=20 Per Share

Compounded Three-Year Annual Earnings Growth of 25% = Forecast=20 With $1.6 Billion in Cost Savings by 2002; Companies to Realize=20 Operational and Sales Benefits, Increase Annual Research and = Development=20 Expenditures to $4.7 Billion in 2000

Leadership in Therapeutic Areas Includes = Cardiovascular, Lipid=20 Lowering, Central Nervous System and Infectious Diseases; 138 = Compounds in=20
Development in Complementary Pipelines

New=20 Company to be Named Pfizer Inc, Will Integrate
"In a Spirit = of=20 Partnership and Mutual Respect"

New York, N.Y. and Morris = Plains,=20 N.J., February 7 =96-=20 Pfizer Inc and Warner-Lambert Company today announced they have = entered=20 into a definitive merger agreement to create the world=92s = fastest-growing=20 major pharmaceutical company.

Under = terms of the=20 merger agreement, Pfizer will exchange 2.75 shares of Pfizer = common stock=20 for each outstanding share of Warner-Lambert stock in a tax-free=20 transaction valued at $98.31 per Warner-Lambert share, or $90 = billion,=20 based on Pfizer=92s February 4 closing price of $35.75. = This=20 represents a 34% premium over the average closing prices of = Warner-Lambert=20 during October 1999.

The = combined company=20 will have annual revenues of approximately $28 billion, including = $21=20 billion in prescription pharmaceutical sales, and will have a = market=20 capitalization in excess of $230 billion.

Compounded annual=20 revenue and earnings growth are expected to be 13 percent and 25 = percent,=20 respectively, through 2002. The transaction will be accretive in = the first=20 full year of operations and will use pooling of interests = accounting. Upon=20 completion, Pfizer=92s shareholders will own approximately 61% of = the new=20 company on a fully diluted basis, and Warner-Lambert shareholders = will own=20 39%.

"By = combining two=20 world-class organizations to create the fastest-growing, major=20 pharmaceutical company in the world, we are positioned for global=20 leadership in the discovery of new medicines that will benefit = millions of=20 patients around the world," said William C. Steere, Jr., chairman = and=20 chief executive officer of Pfizer. "Pfizer and Warner-Lambert = represent a=20 new competitive standard for our industry. We will work together = in a=20 spirit of partnership and mutual respect to capitalize on the=20 extraordinary opportunity now before us."

"The = unwavering goal=20 of our Board of Directors has been to secure the best possible = transaction=20 for Warner-Lambert shareholders and the current Pfizer merger = terms=20 achieve that goal," said Lodewijk J.R. de Vink, Warner-Lambert=92s = chairman,=20 president and chief executive officer. "Our two organizations, = having=20 worked together for several years to achieve the unprecedented = success of=20 Lipitor, will bring the same energy and intensity to achieving the = most=20 rapid and seamless integration of the two companies."

"Through = our Lipitor=20 partnership, we=92ve gained a deep appreciation for = Warner-Lambert=92s=20 commitment to quality and innovation in health care. Our = conviction that=20 Warner-Lambert is the right partner for us has only been = strengthened as=20 we have explored the complementary nature of our companies," said = Dr.=20 Henry McKinnell, president and chief operating officer of Pfizer. = "Working=20 together, we will create a new organization made up of the best = people,=20 best practices and best facilities, and the combined talents of = Pfizer and=20 Warner-Lambert people will make us not just bigger, but better," = he added.=20

The = merger agreement=20 between Warner-Lambert and American Home Products has been = terminated and=20 the cross-options have been rescinded without consideration.=20 Warner-Lambert is paying AHP a $1.8 billion break-up = fee.

Mr. = Steere and Mr. de=20 Vink also commented, "We would like to recognize the efforts of = American=20 Home Products in helping to resolve the issues."

Board of Directors and management team to be drawn from = both=20 companies

Eight = independent=20 directors from Warner-Lambert=92s Board will be invited to join = Pfizer=92s=20 Board. Mr. Steere will be chairman and chief executive officer. = Dr.=20 McKinnell will be president and chief operating officer. From the = period=20 of contract signing to closing, the transition planning team will = be=20 co-chaired by Dr. McKinnell and Dr. Anthony H. Wild, executive = vice=20 president and president, Pharmaceutical sector of Warner-Lambert. = Three=20 members of the Warner-Lambert management team will join Pfizer=92s = Corporate=20 Management Committee.

Mr. de = Vink will=20 remain as Chairman and CEO of Warner-Lambert until closing. He has = made a=20 personal decision not to be an executive in the company after the = closing.=20

"I am = pleased that=20 Lodewijk will remain as CEO of Warner-Lambert until our = transaction=20 closes," said Mr. Steere. "While I respect his personal decision = to leave=20 following the closing, we are hopeful that he will remain = available to=20 advise on key issues as we integrate and harmonize our two = companies," he=20 added.

Dr. = McKinnell=20 emphasized the new company=92s competitive strengths:

Unprecedented=20 depth and breadth of products, including seven billion-dollar = products:=20 Norvasc, Lipitor, Zoloft, Zithromax, Diflucan, Celebrex and = Viagra. The=20 Parke-Davis trade name will be preserved and represented through = the=20 product portfolio, a dedicated sales force and research = organization.=20 Specific areas of product focus include:

The = industry=92s=20 broadest range of products that treat diseases associated with = cardiovascular risks, including: Norvasc for high blood = pressure and=20 angina; Lipitor for high cholesterol; Accupril for high blood=20 pressure; and Glucotrol XL and Rezulin for diabetes.=20

A = significantly=20 expanded program in treating central nervous system disorders = such as=20 depression, anxiety, epilepsy and schizophrenia. Parke-Davis = brings to=20 Pfizer valuable expertise in this area and a sales force that = has=20 extensive experience in calling on mental health = professionals.=20

Infectious=20 diseases, where Pfizer will now have a vastly expanded = portfolio=20 including Pfizer=92s Zithromax and Diflucan anti-infectives.=20 Cutting-edge HIV research comes from Warner-Lambert=92s = Agouron, one of=20 the world=92s foremost biotechnology companies. Pfizer=92s = hospital-based=20 field force fits seamlessly with Agouron=92s outstanding = community-based=20 specialists. Pfizer will also have a major research program in = cancer,=20 including work in anti-angiogenesis.

Women=92s health,=20 with an expanded field force dedicated to women=92s health=20 professionals. Pfizer will emphasize not only reproductive = health but=20 also the importance of cardiovascular and mental health for=20 women.

The continuing = success of=20 the cholesterol-lowering medication Lipitor, which has been = co-promoted=20 by Warner-Lambert and Pfizer since 1996. Lipitor is the number = one=20 statin in the U.S. and the fastest-growing product among = cholesterol=20 lowering agents. This year, Lipitor is expected to exceed $5 = billion in=20 worldwide sales and a spring introduction is planned in Japan. = The=20 companies will benefit from Pfizer=92s strength in Japan. In = addition, the=20 Lipitor-Norvasc combination product represents an important = opportunity.=20

The combined = research and=20 development operations of the company, headed by Pfizer Vice = Chairman=20 Dr. John F. Niblack, will have a worldwide scientific staff of = over=20 12,000 and $4.7 billion in annual R&D expenditures in 2000, = the=20 largest in the industry. The combined companies have few = research=20 overlaps, and a total of 138 compounds in development in areas = including=20 central nervous system disorders, oncology, cardiovascular = disease,=20 metabolic disease and infectious disease. The Parke-Davis = Research=20 Center will continue to be located in Ann Arbor, = Michigan.=20

A strong = international=20 presence with enhanced global reach in all major markets, = including=20 Japan, the second largest pharmaceutical market in the world, = where=20 Pfizer is the leading non-Japanese pharmaceutical company. The = company=20 will be in the top tier in most major markets.

Excellent = opportunities=20 for additional earnings growth based on anticipated cost savings = and=20 efficiencies totaling $1.6 billion. Two hundred million dollars = of these=20 savings are expected to be achieved by year-end 2000, $1 billion = by=20 year-end 2001, and $1.6 billion by year-end 2002.
These cost = savings alone=20 will accelerate the projected compounded annual net income = growth=20 through 2002 for the new company from 20% to 25%, excluding = one-time=20 transaction and restructuring charges. Diluted earnings per = share for=20 Pfizer as a stand-alone company are projected to be $1.04 for = 2000,=20 $1.25 for 2001, and $1.50 for 2002, representing 20% average = compounded=20 growth per year. For the combined Pfizer/Warner-Lambert entity, = pro=20 forma earnings per share in 1999 would be $.80. From this base, = we=20 project that diluted earnings per share for the combined entity = will be=20 $.98 in 2000, $1.27 for 2001, and $1.56 for 2002, representing = 25%=20 average compounded growth per year. These numbers include the = $1.6=20 billion of cost savings phased in over this time period, but do = not=20 include any increased sales from collaborative = activities.
A major = presence in the=20 consumer health care field, including the Warner-Lambert = Confectionery=20 business, through global brands including Halls, Benadryl, = Sudafed,=20 Listerine, Desitin, Schick, Visine, Ben Gay, Lubriderm and = Barbasol.=20 Warner-Lambert=92s and Pfizer=92s long experience in retail and=20 over-the-counter products provides a platform for future=20 prescription-to-OTC switches for both companies. =

Significant = opportunities=20 for the company=92s Animal Health business, which has a growing = pipeline=20 of genetically engineered vaccines, gene-therapy products and = novel,=20 convenient-to-use medicines.

Corporate = headquarters of=20 the company will remain in New York. The Warner-Lambert Consumer = Health=20 Care Division, along with the other consumer businesses and = selected=20 additional functions, will be located at Warner-Lambert=92s = offices in=20 Morris Plains, N.J. The worldwide and U.S. pharmaceutical division = headquarters will be in New York with operational support = functions in=20 both New York and Morris Plains. The transaction is subject to = customary=20 conditions, including the use of pooling-of-interests accounting,=20 shareholder approval at both companies and usual governmental and=20 regulatory approvals. The transaction is expected to close in=20 mid-2000.

"Our combined = company is now=20 strategically positioned as the global leader in research-based = health=20 care as we enter an era of unprecedented scientific discovery, = medical=20 breakthroughs, accelerating consumer choice and continuing changes = in the=20 delivery of care," Mr. Steere said. "We look forward to = discovering and=20 developing many of tomorrow=92s major medical innovations." =

These=20 communications include certain "forward-looking statements" within = the=20 meaning of the Private Securities Litigation Reform Act of 1995. = These=20 statements are based on management=92s current expectations and = are=20 naturally subject to uncertainty and changes in circumstances. = Actual=20 results may vary materially from the expectations contained = herein. The=20 forward-looking statements in this document include statements = about=20 future financial and operating results and the proposed=20 Pfizer/Warner-Lambert transaction. The following factors, among = others,=20 could cause actual results to differ materially from those = described=20 herein: inability to obtain, or meet conditions imposed for, = governmental=20 approvals for the merger with Warner-Lambert; failure of the = Pfizer or=20 Warner-Lambert stockholders to approve the merger; the risk that = the=20 Pfizer and Warner-Lambert businesses will not be integrated = successfully;=20 the costs related to the merger; and other economic, business, = competitive=20 and/or regulatory factors affecting Pfizer=92s and = Warner-Lambert=92s=20 businesses generally. More detailed information about those = factors is set=20 forth in Pfizer=92s and Warner-Lambert=92s filings with the = Securities and=20 Exchange Commission, including their Annual Reports filed on Form = 10-K for=20 the fiscal year ended 1998, especially in the Management=92s = Discussion and=20 Analysis section, their most recent quarterly reports on Form = 10-Q, and=20 their Current Reports on Form 8-K. Pfizer and Warner-Lambert are = under no=20 obligation to (and expressly disclaims any such obligation to) = update or=20 alter their forward-looking statements whether as a result of new=20 information, future events or otherwise.

* * * * * * *

On November=20 15, 1999, Pfizer filed a joint proxy statement/prospectus in = connection=20 with its proposed merger with Warner-Lambert. Pfizer and = Warner-Lambert=20 will be jointly preparing an amendment to the joint proxy=20 statement/prospectus and will be filing such amendment with the = Securities=20 and Exchange Commission as soon as practicable. WE URGE INVESTORS = TO READ=20 THE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT = DOCUMENTS TO=20 BE FILED WITH THE SEC, BECAUSE THEY CONTAIN IMPORTANT INFORMATION. = Investors and security holders may obtain a free copy of the joint = proxy=20 statement/prospectus and other documents filed by Pfizer Inc and=20 Warner-Lambert Company with the Commission at the Commission=92s = web site at=20 http://www.pfizer.com/leaving/gogo.html?urlto=3Dhttp= ://www.sec.gov&urlname=3DSEC.=20 The joint proxy statement/prospectus and these other documents may = also be=20 obtained for free from Pfizer Inc by directing a request to Pfizer = Inc,=20 235 42^nd Street, New York, New York 10017, Attention: = Investor=20 Relations, telephone: (212) 573-2668. READ THE DEFINITIVE JOINT = PROXY=20 STATEMENT/PROSPECTUS CAREFULLY BEFORE MAKING A DECISION CONCERNING = THE=20 MERGER.

# #=20 #

Complementary Product=20 Portfolios

Key Pharmaceutical and Consumer Health=20 Products

Research and Development=20 = Pipeline

This information is intended for=20 = investors.

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