Pfizer 2015 Annual Report Download - page 60

Financial Review
Pfizer Inc. and Subsidiary Companies
2015 Financial Report
59
• U.S. federal or state legislation or regulatory action affecting, among other things, pharmaceutical product pricing, reimbursement or access,
including under Medicaid, Medicare and other publicly funded or subsidized health programs; the importation of prescription drugs from
outside the U.S. at prices that are regulated by governments of various foreign countries; restrictions on direct-to-consumer advertising;
limitations on interactions with healthcare professionals; or the use of comparative effectiveness methodologies that could be implemented
in a manner that focuses primarily on the cost differences and minimizes the therapeutic differences among pharmaceutical products and
restricts access to innovative medicines; as well as pricing pressures for our products as a result of highly competitive insurance markets;
• legislation or regulatory action in markets outside the U.S. affecting pharmaceutical product pricing, reimbursement or access, including, in
particular, continued government-mandated reductions in prices and access restrictions for certain biopharmaceutical products to control
costs in those markets;
• the exposure of our operations outside the U.S. to possible capital and exchange controls, expropriation and other restrictive government
actions, changes in intellectual property legal protections and remedies, as well as political unrest, unstable governments and legal systems
and inter-governmental disputes;
• contingencies related to actual or alleged environmental contamination;
• claims and concerns that may arise regarding the safety or efficacy of in-line products and product candidates;
• any significant breakdown, infiltration or interruption of our information technology systems and infrastructure;
• legal defense costs, insurance expenses, settlement costs, the risk of an adverse decision or settlement and the adequacy of reserves
related to product liability, patent protection, government investigations, consumer, commercial, securities, antitrust, environmental and tax
issues, ongoing efforts to explore various means for resolving asbestos litigation, and other legal proceedings;
• our ability to protect our patents and other intellectual property, both domestically and internationally;
• interest rate and foreign currency exchange rate fluctuations, including the impact of possible currency devaluations in countries
experiencing high inflation rates;
• governmental laws and regulations affecting domestic and foreign operations, including, without limitation, tax obligations and changes
affecting the tax treatment by the U.S. of income earned outside the U.S. that may result from pending and possible future proposals;
• any significant issues involving our largest wholesaler customers, which account for a substantial portion of our revenues;
• the possible impact of the increased presence of counterfeit medicines in the pharmaceutical supply chain on our revenues and on patient
confidence in the integrity of our medicines;
• any significant issues that may arise related to the outsourcing of certain operational and staff functions to third parties, including with
regard to quality, timeliness and compliance with applicable legal requirements and industry standards;
• any significant issues that may arise related to our joint ventures and other third-party business arrangements;
• changes in U.S. generally accepted accounting principles;
• uncertainties related to general economic, political, business, industry, regulatory and market conditions including, without limitation,
uncertainties related to the impact on us, our customers, suppliers and lenders and counterparties to our foreign-exchange and interest-rate
agreements of challenging global economic conditions and recent and possible future changes in global financial markets; and the related
risk that our allowance for doubtful accounts may not be adequate;
• any changes in business, political and economic conditions due to actual or threatened 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, segment and geographic mix;
• the impact of purchase accounting adjustments, acquisition-related costs, discontinued operations and certain significant items;
• the impact of acquisitions, divestitures, restructurings, internal reorganizations, product recalls, withdrawals and other unusual items,
including our ability to realize the projected benefits of our cost-reduction and productivity initiatives, including those related to our research
and development organization, and of the internal separation of our commercial operations into our current operating structure;
• the risk of an impairment charge related to our intangible assets, goodwill or equity-method investments;
• risks related to internal control over financial reporting;
• risks and uncertainties related to our recent acquisition of Hospira, including, among other things, the ability to realize the anticipated
benefits of the acquisition of Hospira, including the possibility that expected synergies and accretion will not be realized or will not be
realized within the expected time frame; the risk that the businesses will not be integrated successfully; disruption from the transaction
making it more difficult to maintain business and operational relationships; significant transaction costs; and unknown liabilities; and
• risks and uncertainties related to our pending combination with Allergan, including, without limitation, the failure to obtain necessary
regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined
company or the expected benefits of the transaction) and shareholder approvals or to satisfy any of the other conditions to the transaction
on a timely basis or at all, the occurrence of events that may give rise to a right of one or both of the parties to terminate the merger
agreement, adverse effects on the market price of Pfizer’s common stock and on Pfizer’s operating results because of a failure to complete
the transaction in the anticipated time frame or at all, failure to realize the expected benefits and synergies of the transaction, restructuring
in connection with the transaction and subsequent integration of Pfizer and Allergan, negative effects of the announcement or the
consummation of the transaction on the market price of Pfizer’s common stock and on Pfizer’s operating results, risks relating to the value
of the Allergan shares to be issued in the transaction, significant transaction costs and/or unknown liabilities, the risk of litigation and/or
regulatory actions, the loss of key senior management or scientific staff, general economic and business conditions that affect the