Pfizer 2006 Annual Report Download - page 29

Download and view the complete annual report

Please find page 29 of the 2006 Pfizer annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 84

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84

Adjusted income as shown above excludes the following items:
YEAR ENDED DEC. 31,
___________________________________________
(MILLIONS OF DOLLARS) 2006 2005 2004
Purchase accounting adjustments:
In-process research and development charges
(a)
$ 835 $1,652 $ 1,071
Intangible amortization and other
(b)
3,220 3,289 3,318
Total purchase accounting adjustments, pre-tax 4,055 4,941 4,389
Income taxes (924) (974) (1,000)
Total purchase accounting adjustments—net of tax 3,131 3,967 3,389
Acquisition-related costs:
Integration costs
(c)
21 543 478
Restructuring charges
(c)
6 375 673
Total acquisition-related costs, pre-tax 27 918 1,151
Income taxes (13) (319) (407)
Total acquisition-related costs—net of tax 14 599 744
Discontinued operations:
Income from discontinued operations
(d)
(643) (695) (563)
Gains on sales of discontinued operations
(d)
(10,243) (77) (75)
Total discontinued operations, pre-tax (10,886) (772) (638)
Income taxes 2,573 274 213
Total discontinued operations—net of tax (8,313) (498) (425)
Cumulative effect of a change in accounting principles—net of tax — 23 —
Certain significant items:
Asset impairment charges and other associated costs
(e)
320 1,240 702
Sanofi-aventis research and development milestone
(f)
(118) ——
Restructuring charges—Adapting to Scale
(c)
1,296 438 —
Implementation costs—Adapting to Scale
(g)
788 325 —
Gain on disposals of investments and other
(h)
(158) (134) —
Litigation-related
(h)
(15) — 369
Contingent income earned from the prior year sale of a product-in-development
(h)
— — (100)
Operating results of divested legacy Pharmacia research facility
(f)
— —64
Total certain significant items, pre-tax 2,113 1,869 1,035
Income taxes (735) (654) (406)
Resolution of certain tax positions
(i)
(441) (586) —
Tax impact of the repatriation of foreign earnings
(i)
(124) 1,664 —
Total certain significant items—net of tax 813 2,293 629
Total purchase accounting adjustments, acquisition-related costs, discontinued operations,
cumulative effect of a change in accounting principles and certain significant items—
net of tax $ (4,355) $6,384 $ 4,337
(a)
Included in Acquisition-related in-process research and development charges. (See Notes to Consolidated Financial Statements—Note 2.
Acquisitions.)
(b)
Included primarily in Amortization of intangible assets. (See Notes to Consolidated Financial Statements—Note 12. Goodwill and Other
Intangible Assets.)
(c)
Included in Restructuring charges and acquisition-related costs. (See Notes to Consolidated Financial Statements—Note 4. Adapting to Scale
Productivity Initiative and Note 5. Acquisition-Related Costs.)
(d)
Discontinued operations—net of tax is primarily related to our Consumer Healthcare business. (See Notes to Consolidated Financial
Statements—Note 3. Discontinued Operations.)
(e)
Included primarily in Other (income)/deductions—net. For 2006 and 2004, includes $320 million and $691 million related to the impairment of
the Depo-Provera intangible asset, and for 2005, includes $1.2 billion related to the impairment of the Bextra intangible asset. (See Notes to the
Consolidated Financial Statements—Note 12B. Goodwill and Other Intangible Assets: Other Intangible Assets.)
(f)
Included in Research and development expenses.
(g)
Included in Cost of sales ($392 million), Selling, informational and administrative expenses ($243 million), Research and development expenses
($176 million) and in Other (income)/deductions-net ($23 million income) for 2006. Included in Cost of sales ($124 million), Selling,
informational and administrative expenses ($151 million), Research and development expenses ($50 million) for 2005. (See Notes to the
Consolidated Financial Statements—Note 4. Adapting to Scale Productivity Initiative.)
(h)
Included in Other (income)/deductions—net. (See Notes to Consolidated Financial Statements—Note 6. Other (Income)/Deductions—Net.)
(i)
Included in Provision for taxes on income. (See Notes to Consolidated Financial Statements—Note 7. Taxes on Income.)
2006 Financial Report 27
Financial Review
Pfizer Inc and Subsidiary Companies