Pfizer 2013 Annual Report Download - page 115

Notes to Consolidated Financial Statements
Pfizer Inc. and Subsidiary Companies
114
2013 Financial Report
Operating Segments
A description of each of our four operating segments follows:
• Primary Care operating segment––included revenues and earnings, as defined by management, from prescription pharmaceutical products
primarily prescribed by primary-care physicians, and included products in the following therapeutic and disease areas: Alzheimer’s disease,
cardiovascular (excluding pulmonary arterial hypertension), erectile dysfunction, genitourinary, major depressive disorder, pain, respiratory
and smoking cessation. Examples of products in this unit in 2013 included Celebrex, Chantix/Champix, Eliquis, Lyrica, Premarin, Pristiq and
Viagra (outside Canada and South Korea). All revenues and earnings for such products were allocated to the Primary Care unit, except
those generated in Emerging Markets and those that were managed by the Established Products unit.
• Specialty Care and Oncology operating segment––comprised the Specialty Care business unit and the Oncology business unit.
Specialty Care––included revenues and earnings, as defined by management, from prescription pharmaceutical products primarily
prescribed by physicians who are specialists, and included products in the following therapeutic and disease areas: anti-infectives,
endocrine disorders, hemophilia, inflammation, ophthalmology, pulmonary arterial hypertension, specialty neuroscience and vaccines.
Examples of products in this unit in 2013 included BeneFIX, Enbrel, Genotropin, Geodon (outside the U.S.), the Prevnar family of
products, ReFacto AF, Revatio (outside the U.S.), Tygacil, Vfend (outside the U.S. and South Korea), Vyndaqel, Xalatan (outside the
U.S., Canada, South Korea, developed Europe, Australia and New Zealand), Xeljanz, Xyntha and Zyvox. All revenues and earnings for
such products were allocated to the Specialty Care unit, except those generated in Emerging Markets and those that were managed by
the Established Products unit.
Oncology––included revenues and earnings, as defined by management, from prescription pharmaceutical products addressing
oncology and oncology-related illnesses. The products in this unit in 2013 included Inlyta, Sutent, Torisel, Xalkori, Mylotarg (in Japan),
Bosulif (in the U.S. and EU) and Aromasin (in Japan and South Korea). All revenues and earnings for such products were allocated to
the Oncology unit, except those generated in Emerging Markets and those that were managed by the Established Products unit.
• Established Products and Emerging Markets operating segment––comprised the Established Products business unit and the Emerging
Markets business unit.
Established Products––included revenues and earnings, as defined by management, from prescription pharmaceutical products that
had lost patent protection or marketing exclusivity in certain countries and/or regions. Typically, products were transferred to this unit in
the beginning of the fiscal year following loss of patent protection or marketing exclusivity. However, in certain situations, products were
transferred to this unit at a different point than the beginning of the fiscal year following loss of patent protection or marketing exclusivity
in order to maximize their value. This unit also excluded revenues and earnings generated in Emerging Markets. Examples of products
in this unit in 2013 included Arthrotec, Effexor, Geodon (in the U.S.), Lipitor, Medrol, Norvasc, Protonix, Relpax, Vfend (in the U.S. and
South Korea), Xalatan (in the U.S., Canada, South Korea, developed Europe, Australia and New Zealand), Zosyn/Tazocin and Viagra
(in Canada and South Korea).
Emerging Markets––included revenues and earnings, as defined by management, from all prescription pharmaceutical products sold in
Emerging Markets, including Asia (excluding Japan and South Korea), Latin America, the Middle East, Eastern Europe, Africa, Turkey
and Central Europe.
• Consumer Healthcare operating segment–– includes worldwide revenues and earnings, as defined by management, from non-prescription
products in the following therapeutic categories: dietary supplements, pain management, respiratory and personal care. Products marketed
by Consumer Healthcare include Advil, Caltrate, Centrum, ChapStick, Emergen-C, Preparation H and Robitussin.
Our chief operating decision maker used the revenues and earnings of the four operating segments, among other factors, for performance
evaluation and resource allocation. For the operating segments that comprised more than one business unit, a single segment manager had
responsibility for those business units.
Other Costs and Business Activities
Certain costs are not allocated to our operating segment results, such as costs associated with the following:
• Worldwide Research and Development, which is generally responsible for research projects until proof-of-concept is achieved and then for
transitioning those projects to the appropriate business unit for possible clinical and commercial development. R&D spending may include
upfront and milestone payments for intellectual property rights. This organization also has responsibility for certain science-based and other
platform-services organizations, which provide technical expertise and other services to the various R&D projects. Worldwide Research and
Development is also responsible for facilitating all regulatory submissions and interactions with regulatory agencies, including all safety-
event activities.
• Pfizer Medical, which is responsible for the provision of medical information to healthcare providers, patients and other parties, transparency
and disclosure activities, clinical trial results publication, grants for healthcare quality improvement and medical education, partnerships with
global public health and medical associations, regulatory inspection readiness reviews, internal audits of Pfizer-sponsored clinical trials and
internal regulatory compliance processes.
• Corporate, representing platform functions (such as worldwide technology, finance, global real estate operations, human resources, legal,
compliance, worldwide procurement, and worldwide public affairs and policy), interest income and expense and certain compensation and
other corporate costs. Other unallocated costs represent overhead expenses associated with our manufacturing and commercial operations
not directly attributable to an operating segment.
• Certain transactions and events such as (i) purchase accounting adjustments, where we incur expenses associated with the amortization of
fair value adjustments to inventory, intangible assets and property, plant and equipment; (ii) acquisition-related activities, where we incur
costs for restructuring, integration, implementation and executing the transaction; and (iii) certain significant items, which include non-