GRANT & EISENHOFER P.A. Jay W. Eisenhofer (JE 5503)...

GRANT & EISENHOFER P .A.Jay W. Eisenhofer (JE 5503)Diane Zilka (DZ-9452)James R. Banko (JB-9686)45 Rockefeller Center, 15`x' Floor

630 Fifth Avenu eNew York, NY 10111Telephone: (212) 755-6501Facsimile : (212) 307-3216

and

Geoffrey C . JarvisSteve GrygielBrian M. RostockiChase Manhattan Centre1201 North Market StreetWilmington, DE 19801Telephone: (302) 622-7000Facsimile : (302) 622-710 0

Attorneys for Lead PlaintiffThe Teachefrs' Retirement System ofLouisiana

IN THE UNITED STATES DISTRICT COURTFOR THE SOUTHERN DISTRICT OF NEW YOR K

IN RE PFIZER INC . SECURITIES LITIGATION 04 Ciro . 9866 (RO )

: JURY TRIAL DEMANDED

CONSOLIDATED CLASS ACTION COMPLAINT

TABLE OF CONTENT S

1 . BASIS OF ALLEGATIONS . . . . . . . . . . . . ._ ._ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

II . JURISDICTION AND VENUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

111 . THE PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

A. Lead Plaintiff The Teachers ' Retirement System of LouisianaB. Named Plaintiffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .C. Pfizer Inc . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D. The Individual Defendants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

i. Henry A . McKinnell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .WJ L r QNA ttina

7

5

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. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7i . in a ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

iii . Karen L. Katen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

iv. Joseph M. Feczko . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I I

v. Gail Cawkwe l l . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 2

IV

V.

GROUP PLEADING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 2

BACKGROUND ON CELEBREX AND BEXTRA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 4

A. The Need For An Alternative Painkiller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15B. The Development, Approval And Launch Of Celebrex . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . .15C. The Development, Approval And Launch Of Bextra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18D. Pfizer's Financial Dependency On Celebrex And Bextra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19E. Success Of Pfizer's COX-2 Launches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20F. Pfizer's Knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 1

VI. PFIZER'S FRAUDULENT SCHEME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

A. P fizer 's Test Results Show That It Knew Its Safety Claims For Celebrex An dBextra Were False . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25i. For Years, Pfizer Touted The Safety Of Celebrex And Bextra, Misleading

The FDA And The Public . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

ii . Pfizer Concealed The Results Of Its 1999 Alzheimer's Study ThatDemonstrated Serious Cardiac Side Effects From Celebrex Use . . . . . . . . . . . . . . . . . .27

iii . Pfizer Intentionally Skewed The Results Of The CLASS Study UponWhich It Relied For Its Claims Of Celebrex 's Safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

iv . Bextra's Known Cardiovascular Risks Were Undisclosed . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31B. The Truth About Celebrex And Bextra Be-ins To Be Revealed To The Public . . . . . . . 34

i. Merck's September 30, 2004 Announcement And P fizer' s Initia lResponse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34

ii . Pfizer Finally Admits Celebrex Causes Increased Cardiovascular Risk . . . . . . .36iii . The FDA Requires a "Black Box" Warning Label On Celebrex . . . . . . . . . . . . . . . . . .39iv . Pfizer Removes Bextra From The Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . .42v. P fizer Admits The Financial Impact Of Its Prior False Statements . . . . . . . . . . . . . . .43

VII . GOVERNMENTAL ACTIONS AND REGULATORY INVESTIGATIONS RELATEDTO CELEBREX AND BEXTRA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

A. The DOJ And SEC Investigations Regarding Celebrex And Bextra . . . . . . . . . . . . . . . . . . . . . . . . .44i . The DOJ Investigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44ii. The SEC Investigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . .45

B. FDA Action. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

Vlll . CLASS PERIOD EVENTS AND THE DEFENDANTS' FALSE AND MISLEADINGSTATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46

A . Pre-Class Period Events and False and Misleading Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46B . Beginning Of The Class Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 1C. Analysts Embrace The Defendants ' False And Misleading Statements In 2000 . . . . . . 52D. 2001 Events and False And Misleading Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53E. Analysts Embrace The Defendants' False And Misleading Statements In 2001 . . . . . . 59F . 2002 Events and False And Misleading Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59G . Analysts Embrace The Defendants ' False And Misleading Statements In 2002 . . . . . .67H . 2003 Events And False And Misleading Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .681 . Analysts Embrace The Defendants ' False And Misleading Statements In 2003 . . . . . . 73J . 2004 Events And False And Misleading Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74K . Analysts Embrace The Defendants ' False And Misleading Statements In 2004 . . . . . . 99

L . 2005 Events And False And Misleadin g, Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 1

IX. APPLICABLE GAAP VIOLATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106

A. Failure To Comply With Regulation S-K, Item 303 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106B. Failure To Comply With Regulation S-X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108C. Failure To Disclose Increasing Contingent Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 1

X. SCIENTERIFRAUDULENT INTENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . .11 2

A. General Allegations Of Scienter .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112B. The Individual Defendants Were In Positions Of Actual Control And/O r

Supervision Of Pfizer 's Manipulative Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113i. Defendant McKinnell . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .114

ii . Defendant LaMattina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .116iii . Defendant Katen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116iv. Defendant Feczko . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118v. Defendant Cawkwe l l . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118

C . Pfizer's Compensation Policies Provided Motive To The Individual DefendantsTo Perpetuate The Celebrex And Bextra Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 8

XI . FRAUD ON THE MARKET. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .120

XII. NO SAFE HARBOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 1

XIII . LOSS CAUSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .122

11

XIV. TOLLING ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124

XV. CLASS ACTION ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .125

COUNT ONE (VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT AND RULEIOb-5(b) PROMULGATED THEREUNDER) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .128

COUNT TWO (VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT AND RULEI0b-5(a) AND (c) PROMULGATED THEREUNDER) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131

COUNT THREE (VIOLATION OF SECTION 20(a) OF THE EXCHANGE ACT) . . . . . . . . . . . . . . . . . . . . . .133

COUNT FOUR (COMMON LAW FRAUD AGAINST ALL DEFENDANTS ON BEHAL FOF LEAD PLAINTIFF AND THE SUBCLASS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134

COUNT FIVE (STATE SECURITIES LAWS VIOLATIONS AGAINST AL LDEFENDANTS ON BEHALF OF LEAD PLAINTIFF AND THE SUBCLASS) . . . . . . . . . . . . . . 135

COUNT SIX (VIOLATION OF SECTION 18 OF THE EXCHANGE ACT) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .137

COUNT SEVEN (VIOLATION OF SECTION 20A OF THE EXCHANGE ACT) . . . . . . . . . . . . . . . . . . . . . . .139

XVI. PRAYER FOR RELIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 1

XVII. JURY DEMAND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .142

iii

This is a securities class action brought by the Teachers' Retirement System of Louisiana

("Lead Plaintiff' or "TRSL") by and through their attorneys Grant & Eisenhofer P.A . and

Plaintiffs Michael Feitler, Christine Fleckles, and Paul Schapka, on behalf of all persons and

entities who purchased or otherwise acquired securities issued by Pfizer Inc . ("Pfizer" or the

"Company"), between and including October 31, 2000 through October 19, 2005 (the "Class

Period") (Lead Plaintiff, other named plaintiffs, and the class are collectively referred to as

"Plaintiffs") .

Plaintiffs allege the following upon information and belief, except as to those allegations

concerning Lead Plaintiff and the additional named plaintiffs, which are alleged upon personal

knowledge . Plaintiffs' information and belief is based upon, among other things, their

investigation, conducted by and through their attorneys, into the facts and circumstances alleged

herein including, without limitation : (a) review and analysis of certain filings made by Pfizer

with the United States Securities and Exchange Commission ("SEC') ; (b) review and analysis of

certain press releases, public statements, news articles, medical studies, and other publications

disseminated by or concerning the Defendants named herein and related parties ; (c) review and

analysis of certain Pf izer press conferences, analyst conference calls and conferences, and the

corporate website of Pfizer ; (d) review and analysis of securities analyst reports concerning

Pfizer and its operations ; (e) review and analysis of prepared statements and other testimony

given before the United States Food and Drug Administration's ("FDA") Arthritis Advisory

Committee and Drug Safety and Risk Management Committee; (0 review and analysis of certain

other information, documents, and materials concerning Pfizer and the other Defendants named

herein; (g) interviews with former Pfizer employees and other industry professionals ; and (h)

review and analysis of Pfizer's Class Period internet advertising and other promotional materials

as they influenced investors .

Plaintiffs believe that further substantial evidentiary support will exist forthe allegations

in this Consolidated Class Action Complaint (the "Complaint") after a reasonable opportunity for

discovery. Many of the facts supporting the allegations contained herein are known only to the

Defendants or are exclusively within their custody and/or control .

1 . BASIS OF ALLEGATIONS

I . Plaintiffs bring this securities fraud action against Pfizer and Henry A .

McKinnell, John L . LaMattina, Karen L . Katen, Joseph M . Feczko and Gail Cawkwell

(collectively, the "Defendants") to recover damages sustained in connection with the

Defendants' fraudulent material misrepresentations and omissions regarding the safety of two of

Pfizer's pain-relieving drugs - Celebrex (celecoxib) and Bextra (valdecoxib) . These drugs

belong to a class of drugs known as Cyclooxygenase 2 ("COX-2") inhibitors . COX-2 inhibitors

are used to treat chronic pain resulting from arthritis and were designed as an alternative to older

drugs such as aspirin, ibuprofen and naproxen . As a result of the fraud alleged herein, Plaintiffs

suffered significant losses in connection with their purchases of the Company's ordinary shares

that traded on various stock exchanges in the United States, including the New York Stock

Exchange ("NYSE") .

2 . For more than five years, Pfizer misrepresented Celebrex as a risk-free painkiller ,

safer than aspirin, ibuprofen and other drugs, which could be taken by almost anyone for a

number of types of chronic pain . Pfizer also misrepresented Bextra as a safe painkiller for a

wide variety of applications . Unbeknownst to investors, however, from at least as early as 1999 ,

Pfizer had in its possession data regarding serious cardiovascular risks of Celebrex and/or Bextra

that contradicted or rendered false statements made by the Defendants throughout the Class

Period about the alleged safety of those drugs . Once the truth - which was known by Pfizer fo r

2

years - was revealed, sales of Celebrex fell dramatically and Bextra was removed from the

market. As a result, Pfizer's stock price declined precipitously.

3 . It is nowclear that Pfizer and its senior management knew that from its initial

approval, Celebrex should have been the subject of the "black box" FDA warning it now carries

regarding the substantial risk of cardiovascular harm that can be caused by using the drug . Had

this "black-box" warning been included on Celebrex's label, it never would have been more than

what it is now -- a niche painkiller used by a segment of special-need patients . Further, the

Defendants knew or were reckless in not knowing that Bextra, because of its extraordinary

dangers to users, never even should have been approved for use by consumers .

4 . The Defendants failed to disseminate to the public results from a study ending i n

1999, that found patients taking Celebrex to treat mild Alzheimer's disease had a statistically

significant increase in heart attacks and other cardiovascular side effects (the "1999 Study") .

The Defendants failed to publicly disclose that the 1999 Study showed Celebrex increased by

nearly four times the risk of cardio vascular problems compared with a placebo . Dr. Lon S .

Schneider, a professor of psychiatry, neurology, and gerontology at the University of Southern

California Keck School of Medicine in Los Angeles, who was part of the safety monitoring

board for Celebrex, said, regarding the 1999 Study : "It should have been fully published i n

2000, and perhaps if it had been some attention might have been drawn to potential safety

issues." (Emphasis added) . Similarly, Dr . Kenneth Brandt, a professor of medicine at Ind Tana

University School of Medicine, who was part of a panel that reviewed Celebrex safety in 2001,

said that, had the panel known about the study, the group would have recommended that both

Vioxx and Celebrex be taken with greater caution . That panel decided in 2001 that Vioxx, but

not Celebrex, should carry a warning about its cardiovascular risks . That difference is one of the

main reasons Celebrex had greater sales than Vioxx .

5 . Moreover, it is clear that the information about the safety of Celebrex that was

hidden from those outside of Pfizer, was well-known inside the company. According to one of

the inventors of Celebrex and Bextra, members of senior management were well aware of the

clinical studies that were conducted on Celebrex and Bextra . Statements by former employees of

Pharmacia Corporation ("Pharmacia") (now Pfizer) who worked on the development of

Celebrex, confirm that all of the negative effects and problems were reported to top management .

6 . It was not until December 17, 2004, when the National Cancer Institute

announced the premature cessation of a trial of Celebrex because of a dramatic increase in

cardiovascular death and stroke among the participants of the trial that the truth began to emerge

concerning Celebrex's safety. Thereafter, on January 31, 2005, Pfizer acknowledged that the

previously undisclosed 1999 Study, conducted prior to Celebrex being approved by the FDA,

found that elderly patients taking the drug were far more likely to suffer heart problems than

patients taking a placebo . Not only was the study concealed from the investing public for five

years, but Pfizer withheld it from the FDA during the FDA's 2000-01 review of the efficacy and

safety of Celebrex . Similarly, only in October 2004, following the very public controversy over

Vioxx, did Pfizer disclose information regarding a study of Bextra that showed serious

cardiovascular problems associated with the use of that drug .

7. From the initial approval of Celebrex by the FDA in 1999, and the subsequen t

FDA approval of Bextra in 2001, through April 2005, Pfizer's website contained no warning

about the cardiovascular dangers associated with the use of Celebrex and Bextra that it knew

existed. Today, Bextra is no longer on the market and Pfizer's Celebrex website states :

"Important Information : CELEBREX may increase the chance of a heart attack or stroke

that can lead to death ." (Emphasis added) .

4

8 . Sales of Celebrex were $2 .6 billion in 2000 and $3 .1 billion in 2001 . After the

introduction of Bextra, the joint sales of Celebrex and Bextra totaled $3 .5 billion in 2002,

approximately $3 .4 billion in 2003, and $4 .5 billion in 2004 . The joint sales of Celebrex and

Bextra constituted between 6% and 11% of Pfizer's total sales from 2002 to 2004 .

9 . Beginning with Pfizer's fi rst announcement in October 2004, regarding Bextra,

Pfizer's sales of the drugs began to decline . The effect of the black box warning label on

Celebrex and the withdrawal of Bextra from the market caused a material decline in Pfizer' s

revenues and earnings . Revenues from Celebrex fell from $2 .294 billion for the first nine

months of 2004 to $1 .258 billion for the same period in 2005, a decline of 45% . Bextra's

revenues for the first three quarters declined by more than $925 million from 2004 to 2005 .

Combined, Celebrex's and Bextra's revenues for the first nine months of 2005 fell by over $2

billion compared to the first nine months of 2004, a decline of 63% . As a result, P fizer's

common stock price fell dramatically . From October 18, 2004 to October 26, 2005, Pfizer's

stock experienced a series of drops, falling from $29 .00 per share on October 18, 2004 to $21 .06

per share on October 26, 2005 (a decline of $7 .94 per share or 27 .4%), representing a loss in

market capitalization of $58.5 billion.

II. JURISDICTION AND VENU E

10. The claims of Plaintiffs alleged herein arise, inter alia, under §§ 10(b), 20(a) and

20A of the Securities Exchange Act of 1934 ("Exchange Act'), 15 U .S .C . §§ 78j(b) and 78t, and

Rule I Ob-5, 17 C .P.R. § 240.10b-5 promulgated thereunder by the SEC.

11 . This Court has jurisdiction over the subject matter of this action pursuant to

Section 27 of the Exchange Act, 15 U .S.C. § 78aa, 28 U .S .C. § 1331 and 28 U.S .C. § 1367 .

12 . Venue is proper in this District pursuant to Section 27 of the Exchange Act, 1 5

U.S.C . § 78aa, and 28 U.S.C . § 1391(b) . Many of the acts and transactions forming the basis fo r

5

the claims in this action, including the preparation and dissemination of materially false an d

misleading statements, and the failure to disclose material information, occurred in substantia l

part in this District . Additionally, the Company's principal executive offices are in New York ,

New York, where the day-to-day operations of the Company are directed and managed .

13 . In connection with the acts and omission alleged in this Complaint, th e

Defendants, directly and/or indirectly, used the means and instrumentalities of interstat e

commerce, including, without limitation, interstate telephone communications, the mails, and th e

facilities of the national securities exchanges .

III. THE PARTIES

A. Lead Plaintiff The Teachers ' Retirement System Of Louisian a

14 . Lead Plaintiff, The Teachers' Retirement System of Louisiana ("TRSL"), is a

public trust fund founded on August 1, 1936, to provide retirement bene fits for its members .

TRSL is the largest public retirement system in the State of Louisiana , with 153,000 active and

inactive members and more than $ 12 .7 billion in assets . TRSL maintains its principal place of

business at 8401 United Plaza Boulevard, Baton Rouge, Louisiana .

15 . As detailed in the attached Schedule A, from October 31, 2000 through Octobe r

19, 2005, Lead Plaintiff TRSL purchased a total of 3,749.368 shares of common stock of Pfize r

at a purchase price of $120,805,969 and suffered losses of approximately $26 .4 million in

connection with those transactions .

B. Named Plaintiffs

16. As detailed in the Certifications attached as Schedule B, from October 31, 200 0

through October 19, 2005, named plaintiffs, Michael Feiterland, Christine Fleckles, and Pau l

Schapka, purchased shares in the common stock of Pfizer and suffered losses in connection wit h

those transactions .

6

C. Pfizer Inc.

17. Defendant P fizer is headquartered in New Yorlc , with its principal place of

business at 235 East 42nd Street, New York, New York . Pfizer is the successor- in-interest of

Pharmacia, laving acquired Pharmacia including all of Pharmacia ' s interest in Celebrex and

Bextra in a transaction valued at $60 billion on or about April 16, 2003 . The Company is a

research-based, global pharmaceutical company that develops, manufactures and markets

prescription medicines for humans and animals, as well as consumer healthcare products . Pfizer

operates in three primary business segments : the pharmaceutical segment ; the consumer

healthcare segment ; and animal health segment. The pharmaceutical segment includes

treatments for cardiovascular and metabolic diseases, central nervous system disorders, arthriti s

and pain, infectious and respiratory diseases, urogenital conditions, cancer, eye disease,

endocrine disorders and allergies . The consumer healthcare segment includes self medications

for oral care, upper respiratory health, tobacco dependence, gastrointestinal health, skin care, eye

care and hair growth. The animal health segment includes treatments for diseases in livestock

and companion animals . The Company also operates several other businesses, including the

manufacture of empty soft-gelatin capsules, contract manufacturing, bulk pharmaceutical

chemicals and diagnostics . As ofNovember 4, 2005, the Company had approximately 7 .37

billion shares outstanding that traded on the NYSE.

D. The Individual Defendants

i. Henry A. McKinnel l

18. Henry A . McKinnell ("McKinnell") has been Pfizer's Chief Executive Officer

since January 2001 and the Chairman of the Board of Directors since May 2001 . As CEO,

McKinnell was Pfizer's Principal Executive Officer. Throughout the Class Period, McKinnell

also was a Director and the Chairman of the Board's Executive Committee . As of March 10,

7

2000, McKinnell was a member of Pfizer's Corporate Management Committee and, through the

end of the Class Period, was a member of Pfizer's Leadership Team. He was President of Pfizer

from May 1999 to May 2001, and President, Pfizer Pharmaceuticals Group, the principa l

operating division of the Company, from January 1997 to April 2001 . McKinnell was Chief

Operating Officer from May 1999 to December 2000 and Executive Vice President from 1992 to

1999. During the Class Period, McKinnell's compensation was tied directly to the performance

of the Company . McKinnell received millions of dollars in annual salary and bonuses plus

millions of dollars in awards of common stock, stock options and other compensation under the

Company's various executive compensation incentive award plans, plus other lucrative

remuneration and compensation, including the use of the Company's transportation, as well as a

handsome severance agreement .

19. In addition to his other duties, as a member of Pfizer's Corporate Management

Committee and thereafter of Pfizer's Leadership Team, McKinne 11 evaluated and made strategic

decisions for the Company .

20. McKinnell signed the following documents that the Company filed with the SEC

during the Class Period which concealed materially false and misleading statements and/or

omitted to state material facts : the Fiscal Year 2000 Form 10-K405 (filed March 28, 2001) ; the

Fiscal Year 2001 Form 10-K (filed March 28, 2002) ; the Third Quarter 2002 Form 10-Q (filed

November 13, 2002) ; the 2002 Form 10-K (filed March 27, 2003) ; the First Quarter 2003 Form

I0-Q (filed May 14, 2003); the Second Quarter 2003 Form l0-Q (filed August 13, 2003) ; the

2003 Form IO-K (filed March 10, 2004) ; the First Quarter 2004 Form I0-Q (filed May 7, 2004) ;

the Second Quarter 2004 Form 10-Q (filed August 6, 2004) ; the Third Quarter 2004 Form I0-Q

(filed November 5, 2004) ; the 2004 Form IO-K (filed February 28, 2005) ; the First Quarter 2005

Form I O-Q (filed May 6, 2005) ; and the Second Quarter 2005 Form 10-Q (filed August 8, 2005) .

21 . In addition to Pfizer's public filings that he signed, McK innell made numerous

public statements concerning Celebrex and Bextra during the Class Period that were materially

false and misleading and/or omitted material facts concerning the continuing threat to Celebrex

and Bextra's medical and commercial viability posed by the severe cardiovascular an d

thrombotic risks that Celebrex and Bextra presented .

22 . During the Class Period, McKinnell sold 809,134 shares of Pfizer stock,

recognizing more than $29 .7 million in proceeds .

ii. John L. LaMattina

23 . John L. LaMattina ("LaMattina") has been Senior Vice President and President -

Pfizer Global Research and Development since October 2003 . Since 1977, when he joined

Pfizer, LaMattina held various positions of increasing responsibility in research and development

before becoming Senior Vice President of Worldwide Development in 1999 . He was named

Vice President of Pfizer Inc . ; Executive Vice President - Pfizer Global Research and

Development ; President - Worldwide Research in April 2001 . He was named Vice President of

Pfizer Inc .; Executive Vice President - Pfizer Global Research and Development ; President -

Worldwide Research and Technology Alliances in May 2002 . Since 2003, LaMattina has been a

member of the Pfizer Leadership Team . During the Class Period, LaMattina's compensation

was tied directly to the performance of the Company, and over the years, including during the

Class Period, he received millions of dollars in annual salary and bonuses, restricted stock and

stock options and other lucrative compensation under the Company's various executive

compensation and incentive plans .

24. In addition to his other duties, as a member of Pfizer's Leadership Team,

LaMattina evaluated and made strategic decisions for the Company .

25 . As detailed herein, LaMattina made numerous public statements concerning

Celebrex and Bextra during the Class Period that were materially false and misleading and/or

omitted material facts concerning the continuing threat to Celebrex and Bextra's medical and

commercial viability posed by the severe cardiovascular and thrombotic risks that Celebrex and

Bextra presented .

26. During the Class Period, LaMattina sold 67,073 shares of Pfizer stock,

recognizing more than $1 .8 million in proceeds .

iii . Karen L. Katen

27. Karen L. Katen ("Katen") was appointed Vice Chairman and President - Pfizer

Human Health in March 2005 . As Vice Chairman and a senior executive officer, Katen reported

directly to McKinnell . She started with Pfizer in 1974, and moved up the ranks to top senior

executive positions . From June 1995 to July 2002, she was President of Pfizer's U .S .

Pharmaceuticals Group and from May 1999 to April 2001 she was Senior Vice President of the

Company . From April 2001 to March 2005, Katen was Executive Vice President and President

of Pfizer Global Pharmaceuticals, the Company's worldwide pharmaceutical organization .

During the Class Period, Katen was a member of the Pfizer Executive Committee. As of March

10, 2000, she was a member of Pfizer's Corporate Management Committee and, thereafter to the

end of the Class Period, a member of the Pfizer Leadership Team . During the Class Period,

Katen's compensation was tied directly to the performance of the Company . As one of Pfizer's

most senior executives during the Class Period, Katen received millions of dollars in annual

salary, bonuses, and awards of common stock, stock options and other compensation and

lucrative benefits from the Company under the Company's various executive compensation and

incentive plans .

10

28 . In addition to her other duties, as a member of Pfizer's Executive Committee, the

Corporate Management Committee and thereafter of Pfizer's Leadership Team, Katen evaluated

and made strategic decisions for the Company .

29 . As detailed herein, Katen made nu erous public statements concerning Celebrex

and Bextra during the Class Period that were materially false and misleading and/or omitted

material facts concerning the continuing threat to Celebrex and Bextra's medical and commercial

viability posed by the severe cardiovascular and thrombotic risks that Celebrex and Bextia

presented.

30. During the Class Period, Katen sold 372,536 shares of Pfizer stock, recognizing

more than $13 .2 million in proceeds .

iv. Joseph M. Feczko

31 . Joseph M. Feczko ("Feczko") was, during the Class Period, President o f

Worldwide Development . He also served as Executive Vice President of Pfizer Global Research

and Development and Senior Vice President, Medical & Regulatory Operations of Pfizer

Pharmaceuticals Group during the Class Period . Feczko was a member of the P fizer

Pharmaceuticals Group Leadership Team during 2000 . He was named Chief Medical Officer on

February 24, 2005 . As President of Worldwide Development and Chief Medical Officer, Feczko

reported directly to LaMattina and Katen .

32 . As detailed herein, Feczko made numerous public statements concerning

Celebrex and Bextra during the Class Period that were materially false and misleading and/or



Bextra presented .

11

v. Gail Cawkwell

33, Gail Cawkwell ("Cawkwell") was, during the Class Period, Pfizer' s medical team

leader for Celebrex.

34. As detailed herein , Cawkwell made numerous public statements concerning

Celebrex and Bexra during the Class Period that were materially false and misleading and/or



Bextra presented .

IV. GROUP PLEADING

35 . Defendants McKinnell, LaMattina, Katen, Feczko and Cawkwell will be referred

to herein as the "Individual Defendants ." As officers, directors, chief scientists and/o r

controlling persons of a publicly-held company that is registered with the SEC under the federal

securities laws and whose common stock trades on the NYSE, and governed by the provisions of

the federal securities laws, each of the Individual Defendants had a duty to promptly disseminate

accurate and truthful information with respect to the financial reporting and the publicly-reported

quarterly and annual results of operations of Pfizer, so that the market price of the Company"s

publicly-traded securities would be based upon truthful, accurate and complete information .

36. The Individual Defendants are liable for the materially false and misleadin g

statements and omissions of material fact in P fizer's SEC fi lings and press releases as such

statements represent "group-published" information , disseminated to the public as a result of the

collective actions of these Defendants . It is appropriate to treat the Individual Defendants as a

group and to presume that the false and misleading information conveyed in the public filings,

press releases and other publications , as alleged herein, are the collective actions of this narrowly

defined group of Defendants . By virtue of their high- level positions within P fizer, the Individua l

12

Defendants directly participated in the management of the Company, were directly involved with

the day-to-day operations and were privy to confidential non-public information concerning the

operations of Pfizer, as alleged herein . The Individual Defendants were involved in drafting,

reviewing and/or disseminating the false and misleading financial statements that were issued by

Pfizer, approved or ratified these statements and, therefore, adopted them as their own .

37. Under the rules and regulations promulgated by the SEC under the Exchange Act ,

specifically Item 303 of Regulation S-K, the Individual Defendants also had a duty to report all

trends, demands or uncertainties that were reasonably likely to impact Pfizer's: (1) revenues ; (2)

expenses ; and (3) previously reported financial information, such that it would be indicative of

future operating results . As set forth more fully below, the misrepresentations and omissions of

the Individual Defendants during the Class Period violated these specific requirements and

obligations as well as their duties and obligations pursuant to the Exchange Act .

38. By reason of their positions with the Company, the Individual Defendant s

attended management and/or board of directors meetings, and had access to internal Company

documents, reports and other information, including adverse non-public information recording

Pfizer's business, operations, products and future prospects, and including nonpubli c

information concerning Celebrex and Bextra . The Individual Defendants were, therefore,

responsible for the truthfulness and accuracy of the Company's public reports, SEC filings and

press releases referred to in this Complaint .

39. The Individual Defendants were responsible for the truthfulness and accuracy o f

the Company's public statements regarding : (I) Celebrex and Bextra's safety, efficacy and

medical and commercial viability and/or risk profile ; and (2) Pfizer's internal accounting.

Defendant McKinnell signed the Company's SEC filings, as more fully described herein, and

certain of these SEC filings contained certifications signed by him pursuant to § 302 of th e

13

Sarbanes-Oxley Act of 2002 . Based upon such signed certifications, Defendant McKinnell is

responsible for the truthfulness and accuracy of Pfizer's public reports, press releases and other

statements concerning, among other things, the medical and commercial viability of Celebrex

and Bextra and the Company's financial results, as detailed herein . Defendant McKinnell is

primarily liable for the materially false and misleading representations and omissions of material

facts contained within these statements.

40. The Individual Defendants participated in preparing and/or approving the publi c

reports and other statements and communications described above and discussed more fully

herein. Each of the Individual Defendants knew or recklessly disregarded the fact that the false

and misleading statements and omissions complained of herein would adversely affect the

integrity of the market for Pfizer's stock, would cause the price of Pfizer's common stock to

become artificially inflated, and would expose Celebrex and Bextra users to a significant risk of

injury or death . Each of the Individual Defendants acted knowingly or in such a reckless manner

as to constitute a fraud and deceit upon Plaintiffs .

V. BACKGROUND ON CELEBREX AND BEXTRA .

41 . Throughout the Class Period, Pfizer and the Individual Defendants deliberatel y

pursued a fraudulent scheme to make false and misleading statements and to omit disclosing

material facts concerning Celebrex and Bextra's safety, and medical and commercial viability .

(See n fra Section VI.A.) . During this time, the Defendants knew, but failed to disclose,

statistically significant data demonstrating that Celebrex and Bextra posed high cardiovascular

and thrombotic risks that threatened Celebrex and Bextra's medical and commercial viability .

(See infra Section VI.A.) . Many of the details of the Defendants' fraud have emerged following

the Company's late 2004 and 2005 announcements . (See infra Section VI .B.) . The significant

risk of cardiovascular or thrombotic events due to Celebrex and Bextra known by the

14

Defendants, but concealed until 2005, include sudden cardiac death, heart attack, unstable

angina, transient ischemic attack, thrombosis, arterial blood clots and venous blood clots .

A. The Need For An Alternative Painkiller

42 . Conditions such as arthritis cause chronic pain . Prior to 1999, persons suffering

chronic pain and inflammation turned to certain NSAIDs, such as aspirin, ibuprofen, and

naproxen for relief. People taking NSAIDs over a protracted time period, however, often

developed stomach ulcers and other gastrointestinal problems .

43 . Traditional NSAIDs effectively block two enzymes: Cyclooxygenase 1 ("COX-

I") ; and COX-2. COX-1 is a protein that acts as an enzyme to catalyze (speed up) the

production of prostaglandins (chemical messengers) within the stomach, which promote the

production of the natural mucus lining that protects the inner stomach . COX-2 is a protein that

acts as an enzyme and specifically catalyzes the production of certain prostaglandins responsible

for promoting inflammation . When COX-2 activity is blocked, inflammation is reduced .

Because traditional NSAIDs suppress the pain-causing enzyme COX-2, but also suppress the

COX-1 enzyme, they tend to cause harmful gastrointestinal side effects .

44. The discovery of two forms of cyclooxygenase in 1991 by Phillip Needleman ,

Ph.D. ("Needleman") at his research laboratory at Washington University in St . Louis opened the

possibility of creating alternative painkillers that would suppress only the COX-2 enzyme,

hopefully decreasing gastrointestinal side effects commonly associated with chronic use of

traditional NSAIDs .

B. The Development, Approval And Launch Of Celebre x

45. The development, approval and launch of Celebrex was an all-out race to market

between G .D. Searle & Co . ("Searle') and pharmaceutical giant, Merck & Co ., Inc. ("Merck") .

The race between the two companies began in the 1990s with the discovery of two forms o f

15

cyclooxygenase . A story appearing on the Dow Jones Newswire, on May 21, 1999,

encapsulated the importance of the discovery to pharmaceutical companies : "The battle for this

summer's blockbuster may not occur in movie theaters, but instead in the corner drugstore ." The

article was referring, of course, to the battle between Celebrex and Merck's Vioxx for COX-2

inhibitor supremacy .

46. Capitalizing on the market opportunity created by the discovery of the COX- 2

enzyme, Searle, with the assistance of Needleman, launched an all-out effort to develop a COX-2

selective inhibitor before Merck . Needleman had left his research laboratory to join Searle to

pursue an once- in-a- lifetime opportunity to create the new drug . Deemed Searle's "Manhattan

Project," Needleman commandeered one-third of all medicinal chemists at Searle for the project .

47. Business analysis of COX-2 predicted the company that won the race to the

market would reap rewards of billions . However, there was a big potential downside for Searle .

"If [Searle] failed, it would be serious, serious trouble for Searle," Needleman said . "In many

ways we bet the company on the drug ." With so much at stake, Searle launched an all-out drive

to the end. Management mapped out what the key players needed to get done each day . Special

coffee mugs memorialized the Merck threat . Needleman even went back to Searle's parent,

Monsanto and Company ("Monsanto"), for an emergency infusion of millions of extra dollars .

48. The gamble paid off. The new drug approval application for Celebrex was filed

with the FDA on or about June 29, 1998, and received FDA approval on or about December 31,

1998. Celebrex was the first COX-2 inhibitor to obtain regulatory approval . Merck's Vioxx was

not approved by the FDA until May 20, 1999 .

49 . Prior to filing the new drug approval application, the Defendants had not done any

significant testing of Celebrex for cardiovascular safety .

16

50. The FDA approved Celebrex for use by prescription in treating pain and

inflammation caused by osteoarthritis ("OA"), a type of arthritis caused by wear and tear on the

body's bones and joints, and adult rheumatoid arthritis ("RA"), which is an autoimmune disease

that attacks healthy joint tissues, causing inflammation and joint damage . Celebrex was later

approved for the treatment of acute pain in adults (such as pains from strains and sprains) or pain

after surgery, as well as for the treatment of primary dysmenorrhea (painful menstrual cramps) .

51 . But the race was not over. The Company still needed to launch Celebrex first .

Searle, however, was not large enough to do the launch fast enough to win the prize . Thus,

Searle recruited as marketing partner Merck's most formidable and aggressive rival, Pfizer .

52. On February 18, 1998, Searle and Pfizer jointly announced that they entered into

an agreement covering the co-promotion and development of Searle's Celebrex (and its second

generation compound, which was later named Bextra) .

53 . Their partnership paid off, as Celebrex was the first COX-2 inhibitor to hit the

market . Celebrex was launched in January 1999 .

54. On December 19, 1999, Monsanto and Pharmacia announced a definitive

agreement to merge . Pharmacia acquired the rights to Celebrex (and Bextra) in the merger with

Monsanto. Following the merger, Pharmacia continued Searle's agreement with Pfizer covering

the co-promotion and development of Celebrex (and later Bextra) .

55 . On July 15, 2002, Pfizer and Pharmacia jointly announced that they signed a

definitive agreement providing for Pfizer to acquire Pharmacia in a stock-for-stock transaction

valued at $60 billion . Pharmacia then spun-off its remaining ownership of Monsanto to its

current shareholders, and Pfizer's acquisition of Pharmacia was completed on April 16, 2003,

forging one of the world's fastest-growing and most valuable companies . In the acquisition of

Pharmacia, Pfizer gained sole control over Celebrex (and Bextra) .

17

56 . Unless otherwise stated, Searle, Monsanto, Pharmacia and Pfizer are hereinafte r

collectively referred to as "Pfizer . "

C. The Development , Approval and Launch Of Bextra

57. Bextra is another COX-2 selective inhibitor discovered by the Searle division o f

Monsanto in the late 1990s to combat the effects of OA and adult RA .

58. Bextra was initially co -promoted and developed by Pfizer and Searle pursuant to

the agreement announced by Pfizer and Searle on February 18, 1998 .

59. Following the merger between Monsanto and Pharniacia on March 31, 2000 ,

Pharmacia acquired the rights to Bextra (and Celebrex) . Pharmacia continued Searle' s

agreement with Pfizer covering the co-promotion and development of Bextra (and Celebrex) .

60. On or about January 16, 2001, the new drug approval application for Bextra wa s

filed with the FDA .

61 . On or about November 16, 2001, the FDA approved Bextra for use b y

prescription in treating OA, adult RA and primary dysmenorrheal (painful menstrual cramps).

Bextra also was required to carry the same gastrointestinal risk warning as existing NSAIDs .

62. In the FDA's approval package for Bextra published on or about November 16 ,

2001, an FDA medical officer noted problems with Bextra 's cardiovascular safety profile,

stating, for example: "[t]he excess of serious cardiovascular thromboembolic [blood clots ] events

in the valdecoxib arm of the CABG [Coronary Artery Bypass Graft] trial is of note as the entire

study population received prophylactic low dose aspirin as part of the standard of care in this

setting to minimize just such events," and that "[gliven the emerging concern over a possible

pro-thrombotic action of ce rtain agents in the COX-2 class, these data are of concern . "

63 . The FDA' s cautiona ry statements in Bextra's approval package were deleted b y

the Defendants from the publicly available Bextra approval package . The above-quoted

18

statements were redacted, and in their place appears the purported reason : "[the redacted

information has] been removed because it contains trade secret and/or confidential information

that is not disclosable . "

64. Bextra was successfully launched in April 2002 . At the time, Bextra was co-

promoted and developed by Pfizer and Pharmacia .

65 . After the acquisition of Pharrnacia, which was completed on April 16, 2003,

Pfizer gained sole control over the promotion and development of Bextra (and Celebrex) .

D. Pfizer's Financial Dependency On Celebrex And Bextra

66. Pfizer's financial success and future prospects depended on Celebrex and Bextra

becoming "blockbuster' drugs . Within the five years after Celebrex and Bextra's expected

arrival on the market in 1999-2002, Pfizer faced patent expiration dates for several of its best-

selling drugs and the resulting loss of at least $4 .7 billion in annual revenues to generic

competition . For example, the patent for Ambien, Pharmacia's blockbuster sleep medication that

accounted for $523 million in sales in 1999, $705 million in 2000, and $902 million in 2001, wa s

set to expire in 2006, and Pharmacia was to lose marketing rights to the product in April 2002 .

Profitable Pfizer drugs scheduled to lose patent protection during or shortly after the Class Period

included Zithrornax, an antibiotic that accounted for over $1 .3 billion in sales in 1999, $1 .3

billion in 2000, and $1 .5 billion in 2001, the patent for which would expire in 2005, and Zoloft,

which accounted for over $1 .9 billion in sales in 1999, $2 .1 billion in 2000, and $2.3 billion in

2001, the patent for which will expire in 2006 . In comparison, the patent for Celebrex will not

expire until 2013 . The patent for Bextra will not expire until 2015 .

67 . Pfizer needed Celebrex and Bextra to make up for these soon-to-be-lost sales

from these blockbuster drugs . As a result, Pfizer aggressively pursued a merger with Pharmacia

to secure continued revenues and earnings past 2010. Dr. Tadeusz J . Szuba's article entitle d

19

"Merger Mania°' published in the Journal of the Chamber of Pharmacists explained that, in order

for Pfizer to sustain its revenues and earnings following the expiration of certain patents, it was

critical for Pfizer "to go forward with [the] merger with Pharmacia ."

68. Pfizer's merger with Pharrnacia highlights Pfizer's motive to push sales at any

cost. And Peter B . Corr, Executive Vice President of Pfizer Global Research and Development,

noted in a September 8, 2002 New York Times article, in regard to Pfizer's merger with

Pharmacia : "you need the power of scale to exploit the science ."

E. Success Of Pfizer's COX-2 Launches

69. Pfizer's COX-2 product launches were extremely successful . Celebrex, in fact, is

the most successful product launch in the history of the pharmaceutical industry. Celebrex

generated revenues of over $1 .4 billion in 1999, $2 .6 billion in 2000, $3 .1 billion in 2001, $3 .0

billion in 2002, approximately $2 .5 billion in 2003, and $3 .3 billion in 2004 . Bextra also had a

successful debut . Bextra generated revenues of $470 million in 2002, approximately $875

million in 2003, and over $1 .2 billion in 2004 .

70. Pfizer received a portion of the sales of Celebrex and Bextra until 2003, when

Pfizer acquired Pharmacia and its roster of drugs, including Celebrex and Bextra, for $60 billion .

After that, revenue from the sale of Celebrex and Bextra went exclusively to Pfizer .

71 . Together, Celebrex and Bextra accounted for approximately 8 .7% of Pfizer's

revenue in 2004, totaling over $4 .5 billion.

72. During this time period the Defendants made and/or caused to be issued numerou s

materially false and misleading statements and/or omissions of material facts . Pfizer

continuously touted the cardiovascular safety of Celebrex and Bextra, and even went so far as to

argue that they were safer than Merck's competing drug Vioxx, even though the Defendants

knew from their own studies that both Celebrex and Bextra presented significant cardiovascula r

20

and other health risks . The Defendants further touted the financial performance of both drugs

and the importance of such drugs to Pfizer's overall financial results, suggesting that such

performance was likely to continue into the future, without disclosing that, had they made

publicly available all of the information known to Pfizer from its testing regarding the safety

issues raised by these drugs, neither drug would have been a significant contributor to Pfizer's

financial performance .

73 . Until the truth about Celebrex and Bextra was disclosed, Celebrex and Bextr a

were extremely profitable for Pfizer and extremely expensive for consumers . According to

Consumer Reports, at the end of December 2004, to the end-user, Celebrex cost about $130 per

month, and Bextra cost about $114 per month, compared with $24 .00 per month for over-the-

counter naproxen or ibuprofen . Given the fact that, by 2004, Celebrex was one of the top 10

selling drugs in the United States and approximately 25 million prescriptions for Celebrex and

Bextra were written in 2004, Pfizer generated billions in revenues from its materially false and

misleading statements and omissions of material fact concerning Celebrex and Bextra's safety,

and medical and commercial viability .

F. Pfizer's Knowledge

74. From the outset Celebrex (and later Bextra) were designed to do less than aspirin ,

to be more selective and target fewer control switches inside the body . In doing so, Celebrex and

Bextra had lost one positive benefit of aspirin -- the cardio-protective effect achieved through

inhibiting blood clots. When the pre-FDA approval studies were being conducted, Pfizer

officials knew the worst case scenario would be if Celebrex had a negative cardiovascular effect .

When the 1999 Study showed this to be the case, the Defendants decided to keep that

information quiet .

21

75 . Thus, from the time the 1999 Study was completed, until January 2005, no one at

Pfizer (or its predecessor companies Searle and Pharmacia) disclosed the negative information

about Celebrex, even though the negative results of the 1999 Study clearly were known to senior

management, including the Defendants . Similarly, results of the negative June 2003 study

regarding Bextra also were known to, and withheld from the public by, senior management .

76 . Dr. John Talley, one of the developers of Celebrex and Bextra, informe d

Plaintiffs' counsel that senior managers were "right on top of the clinical studies related to

Celebrex in Bextra. Similarly, Paul Dodson, the former Senior Director of Strategic Planning

and Regional operations for Pharmacia, acknowledged to Plaintiffs' counsel that decisions on

what drugs to bring to market and when to launch such drugs ultimately "comes from the top ."

He further stated that information on clinical trial findings would be reported to top management

and would be reported with some specificity where there was "some negative effect or a

problem" with the drug. He specifically noted that the cardiovascular safety profile of Celebrex

was a big issue with top management and that Dr . Needleman (the director of research at Searle

and Pharmacia) was the person responsible for updating top management on significant

developments relating to Celebrex and Bextra .

77. Krista Fox, a former Global Marketing Communications Manager at Pharmacia ,

explained that information regarding the clinical trials of a drug was disseminated to key

decision-makers . She stated that Pharmacia, like all other companies, had a medical information

group within the company that "knows the science of a drug inside and out as well as adverse

events, issues and concerns relating to the drug . Anything that you are going to get out to the

public as it relates to sales and marketing efforts has to go through a review committee which

usually consists of legal . medical and regulatory and they are experts on the drug and they have

to approve everything."

22

78 . Pfizer built cohesive teams of cross-functional groups to launch products called

"brand teams ." Brand team members worked on the same prescription drug such as Celebrex

from the beginning. These brand teams would work together for the full period of the drug -

often TO to 12 years --- from the period during which the drug was undergoing clinical trial an d

awaiting regulatory approval through the launch of the drug to the public, and through

marketing, advertising and sales . Pfizer and the Individual Defendants, including Defendant

Katen, encouraged open communication among individuals from various functions, including

scientists, physicians, salespeople, and marketers, both before and after FDA product approval .

79. Andrew Watson, a Senior Product Manager on the Celebrex brand, explained how

the key information was known to the "brand team" decision makers . He explained that the

brand team gets involved in the R&D process through the new drug application stage because

`'you want to think about how you're going to be able to commercialize a product when it finally

comes to market, so as much involvement as you can the better ." Watson acknowledged that

brand teams would have been aware of the science behind a drug, inclusive of the R&D as well

as the risks and efficacy of a brand . He further acknowledged that between the fling of a new

drug application with the FDA and final FDA approval of a drug, the brand team is working with

many other groups including the marketing people and the finance people in order to get the drug

to market .

80. The widespread dissemination of critical information about Pfizer's drugs to the

persons within P f izer who need access to the information was part of Pfizer s (and its

predecessors) usual practice and routine course of business . For example, Defendant Katen is

Vice Chairman of Pfizer, President, Pfizer Human Health, and is a member of the Company's

Executive Committee, its governing management body . Katen is also a member of Pfizer's

Leadership Team . As head of Human Health - Pfizer's principal operating group - during th e

23

Class Period, she lead the business responsible for the discovery, development, manufacture,

distribution and commercialization of prescription medicines . From their beginnings, Katen was

involved in the marketing of Celebrex and Bextra as head of the Celebrex and Bextra brand

teams. In that position, Katen was responsible for anything that touched upon the brand's sales

force, sales aids, and anything promotional about the product (including its prescription label).

81 . Katen mandates the dissemination of information critical to the development and

marketing of drugs throughout the Pfizer organization . Emblematic of her requirement that

information be shared is the paperweight on her desk with the inscription, "Who else needs to

know?" - a question alluding to the ongoing need to share critical information as widely as

possible within Pfizer.

82 . Thus, at Pfizer and its predecessors, all the top management had knowledge of the

lack of disclosure of material adverse information concerning the cardiovascular and thrombotic

risks associated with Celebrex and Bextra .

VI. PFIZER'S FRAUDULENT SCHEME

83. As described in detail below, Pfizer has known for many years that its drugs

Celebrex and Bextra create significant cardiovascular risks for the users of those drugs .

Nonetheless, from the time it first sought approval of Celebrex in 1998, until late 2004 and 2005 .

Pfizer continuously touted to the public the safety and efficacy of Celebrex and Bextra in order

to ensure that the sales of those drugs would provide the level of "blockbuster" revenues that

would increase Pfizer's stock price and enrich its officers and directors . It was not until late in

2004 and 2005, after the revelations about the cardiovascular danger posed by Merck's

competing drug Vioxx, that the truth about Celebrex and Bextra came out . As a result, Pfizer's

revenues from Celebrex and Bextra have fallen sharply and its share price has declined . As

explained above, Pfizer's stock experienced a series of drops from October 18, 2004 to Octobe r

24

26, 2005, falling from $29 .00 per share to $21 .06 per share (a decline of $7 .94 per share or

27 .4%), representing a loss in market capitalization of $58.5 billion. Revenue earned by

Celebrex and Bextra for the first nine months of 2005 also declined 63% to $1 .199 billion

compared to revenue of $3 .163 billion for the first nine months of 2004 .

A. Pfizer's Test Results Show That It Knew Its Safety Claims For Celebrex And

Bextra Were False

i . For Years, Pfizer Touted The Safety Of Celebrex And Bextra,Misleading The FDA And The Publi c

84. From the filing of a new drug application for Celebrex in 1998, through its

approval and launch in 1999, and through nearly to the end of 2004, Pfizer continuously

informed the public that Celebrex, and later, Bextra, were wholly safe, blockbuster drugs that

could control pain with no side-effects . In touting the safety of Celebrex and Bextra, Pfizer

issued numerous press releases and other statements regarding scientific studies that allegedly

established the safety of these drugs . For example, on February 15, 2000, shortly after its

launch, Pfizer issued a press release regarding a study in the Journal of Clinical Pharmacology .

The press release stated that `there doesn't appear to be any dose-related increase in the

cardiovascular-related side effects of hypertension of peripheral edema ." (Emphasis added) .

85 . Two months later, on April 17, 2000, Pfizer issued another press release regarding

the alleged safety of Celebrex that stated : "Imtrportantly, Celebrex sltowved fro increase in

throtnboeinbolic or other cardiovascular-related events, even among non-aspirin users .

(Emphasis added) .

86. Days later, on April 28, 2000, the Defendants brazenly told the world that, as

purportedly found in a separate study, a trial comparing the inflammation-reducing effectiveness

of Celebrex, aspirin, and ibuprofen against a placebo, called the `CLASS Study," users of

Celebrex did not experience any cardiovascular effects . Indeed, the Defendants falsely state d

25

that Celebrex demonstrated a strong safe ty profile, with no increase in stroke or heart attack

during the study . These statements continued through 2005 . (See infra Section VIII) .

87 . Pfizer even misled the FDA regarding the risks of Celebrex. As described in

detail below (see i fra Section VI .A.ii), the 1999 Study, which showed that increased

cardiovascular events were associated with Celebrex use, was not submitted to the FDA unti l

after the FDA conducted a review in 2001 ofCelebrex`s safety . One doctor who participated in

that review, Dr. Kenneth Brandt, a professor of medicine at Indiana University School of

Medicine, said that if the study safety panel had known about the study, the group might have

recommended that both Vioxx and Celebrex be taken with greater caution . Further, Dr. Lon S .

Schneider, a professor of psychiatry, neurology, and gerontology at the University of Southern

California Keck School of Medicine in Los Angeles, who was part of a safety monitoring board

for Celebrex, said, regarding the 1999 Study : "It should have been fully published in 2000, and

perhaps if it had been some attention might have been drawn to potential safety issues . "

(Emphasis added) .

88. Similarly, from the outset of its U .S. launch in February 2002, Bextra was touted

by Pfizer as an effective and safe form of pain reliever. For example, in an October 28, 2002

press release, Pfizer stated :

Analyses of pooled study results for the COX-2 specific inhibitorBEXTRA® (valdecoxib tablets), presented at this year's annualscientific meeting of the American College of Rheumatology(ACR), underscored its improved upper gastrointestinal (GI) safetyas well as its cardiovascular safety profile.

(Emphasis added) .

89. Over the next three-and-one-half years, Pfizer regularly issued press releases and

other public statements touting the alleged safety of Celebrex and Bextra . (See iyi•a Sectio n

26

VIII setting forth numerous of false and misleading statements by Pfizer regarding the safety of

Celebrex and Bextra) .

90 . In fact, as late as October 2004, after Merck withdrew Vioxx from the market,

Pfizer, seeking to exploit the opportunity presented by Vioxx's withdrawal, falsely asserted the

cardiovascular safety of both Celebrex and Bextra in a press release . See VI.B.i .

ii. Pfizer Concealed The Results Of Its 1999 Alzheimer's Study ThatDemonstrated Serious Cardiac Side Effects From Celebrex Use

91 . Early in its research on COX-2 drugs, Pfizer knew that selectively blocking th e

COX-2 enzyme interfered with production and operation of prostacyclin, which, in turn, meant

that blood clots were more likely to form. Prostacyclin acts chiefly to prevent platelet formation

and clumping involved in blood clotting. An increased risk of blood clots meant an increased

risk of serious, even fatal, cardiovascular side effects . Patients not previously at risk for these

cardiovascular side effects could become at risk by taking COX-2 drugs . Patients already at risk

for these cardiovascular side effects could become at even greater risk by taking such drugs .

92 . Unbeknownst to investors, from 1999 onward, the Defendants had specific

evidence that the theoretical effects from COX-2 drugs were in fact present in Celebrex and that

Celebrex use was attributed to serious cardiac side effects . This evidence regarding the dangers

of Celebrex, however, remained publicly undisclosed until January 2005 .

93. In particular, alarming cardiovascular events were observed in the 1999 Study, a

Phase Il study of the drug that began in 1997 and was completed in 1999 . In this study, serious

adverse cardiovascular events occurred in a number of patients . Indeed, cerebrovascular disorder

(stroke), cardiac failure, pulmonary edema, angina pectoris, atrial fibrillation (cardiac

arrhythmia) and myocardial infarction (heart attack) were observed at a rate 3.6 limes greater

than observed in trial patients taking a placebo .

27

94. The 52-week study, which was never published in a medical journal, was

designed to determine whether Celebrex could be used to slow the progression of Alzheimer's

disease and examined the long-term effects of high doses of the medicine in the elderly . In the

study, 285 patients were randomly selected to receive 400 milligrams of Celebrex per day, and

140 patients were given placebos . In the Celebrex group, 22 participants had heart attacks,

strokes or other heart problems, compared with three in the placebo group . The study's authors

wrote : `A statistically significant difference favoring placebo in adverse events was observed ."

(Emphasis added) .

95 . The 1999 Study was never published .

96. Two doctors who participated in that review said that they had not known abou t

the 1999 Study until late January 2005 . One of them, Dr . Kenneth Brandt, a professor of

medicine at Indiana University School of Medicine, said that if the study safety panel had known

about the study, the group would have recommended that both Vioxx and Celebrex be taken with

greater caution. That panel decided in 2001, that Vioxx, but not Celebrex, carry a warning about

its cardiovascular risks . That difference is one of the main reasons Celebrex had greater sales

than Vioxx .

97. The results of the 1999 Study were not available to the public until early January

2005, when Pfizer, with no public notice whatsoever, posted the results of the 1999 Study onto

the clinical trials website hosted by Pharmaceutical Research and Manufacturers of America

("PhRMA"), the pharmaceutical industry's main trade group .

iii . Pfizer Intentionally Skewed The Results Of The CLASS Study UponWhich It Relied For Its Claims Of Celebrex's Safet y

98 . An important mainstay of Pfizer's claims regarding the purported safety of

Celebrex were the results of the Celecoxib Long-Term Arthritis Safety Study ("CLASS Study") .

Pfizer, Pharmacia, Monsanto and Searle paid for the CLASS Study, hoping, this clinical tria l

28

would demonstrate that Celebrex offered a superior gastrointestinal safety profile . The

Defendants claimed Celebrexhad an advantage over existing NSAIDs in the form of reduced

risk of gastrointestinal side effects including, for example, ulcerations, ulcerative perforations,

gastrointestinal bleeding, and blockage of the gastrointestinal outlet .

99 . Upon completing the CLASS in March 2000, the Defendants sent the results o f

the gastrointestinal part of the study - but not the results showing increased risk of cardiovascular

problems - to the FDA's Arthritis Drugs Advisory Committee . Unconvinced by the submitted

data, the Arthritis Drug Advisory Committee found that the CLASS trial results did not show

that Celebrex produced a "clinically meaningful" safety advantage - namely, fewer

gastrointestinal problems - over traditional NSAIDs . Accordingly, the Arthritis Drug Advisory

Committee reviewing the CLASS recommended that Celebrex's package contain an insert

containing the same gastrointestinal warnings as traditional NSAIDs, and advised that further

studies were needed to determine the risk of COX-2 blockers when taken with aspirin .

100. Although the Defendants were not permitted to claim that Celebrex' s

gastrointestinal protection was superior to traditional NSAIDs, the Defendants nonetheless

engaged in a saturation marketing effort, trumpeting Celebrex's combination of pain relief

without the untoward gastrointestinal side effects produced by traditional NSAIDs . This

campaign was based on a falsehood since the FDA Committee had not found that Celebrex's

gastrointestinal protection was superior to that of traditional NSAIDs . Indeed, on October 6,

1999, the FDA sent a warning letter complaining of this falsehood .

101 . The purported results of the CLASS Study were published on September 13,

2000, to much fanfare by Pfizer, in an article entitled "Gastrointestinal Toxicity with Celecoxib

vs. Nonsteroidal Anti- inflammatory Drugs for Osteoarthritis and Rheumatoid Arthritis °" in the

Journal of the American Medical Association (the "JAMA Article"). The CLASS Study

29

published in JAMA and relied upon by Pfizer was a randomized 6-month trial comparing the

inflammation-reducing effectiveness of Celebrex, aspirin , and ibuprofen against a placebo . But

the results of the study were intentionally misrepresented by Pfizer .

102 . The published CLASS Study played up the first 6-month results to support a

claim of improved gastrointestinal safety for Celebrex . However, the JAMA Artic le and the

published CLASS Study failed to mention that the actual CLASS Study encompassed a 12-

month period that revealed Celebrex posed serious cardiovascular risks . The JAMA Article also

failed to disclose that the study's 16 authors were either employees of Pharmacia, Celebrex's

manufacturer, or paid consultants of the Company .

103. According to Public Citizen's "Petition to Remove the COX-2 Inhibitors

Celecoxib (CEBREX) and Valdecoxib (BEXTRA) from the Market (HRG Publication #1720),"

dated January 24, 2005 ("Public Citizen's Petition"), submitted by Sidney M . Wolf, MD, the 12-

month data set revealed that the rate of combined anginal cardiac adverse events was 1 .4% in the

celecoxib group versus 1 .0% in either of the other NSAID groups .

104. The Public Citizen's Petition noted that the "trend was magnified in those patient s

not taking low-dose aspirin . Combined anginal disorders were increased in these patients ; the

celecoxib group had 0 .6% vs . 0.2% and 0% in the diclofenac and ibuprofen groups, respectively .

There were also more combined atrial serious cardiac adverse events with celecoxib, 0 .3%

compared to 0 .1% and 0% in the diclofenac and ibuprofen groups, respectively ." Additionally,

the rate of myocardial infarction was higher in the celecoxib group, 0 .2%, compared with the

other two drugs, 0 .1 % .

105 . Thus, the actual CLASS Study results, not published in JAMA, revealed an

elevated rate of heart attacks (1 .6%) among the Celebrex sample pool compared with the 1 .2%

rate of the sample pool taking law-dose aspirin . Celebrex also displayed a similar elevated risk

30

compared to the sample pool taking the placebo . Thus, Pfizer relied upon a manipulated portion

of the study to support its claims of Celebrex safety .

iv. Bextra's Known Cardiovascular Risks Were Undisclosed

106. The new drug application for Bextra was submitted to the FDA in April 2001 .

The Bextra new drug application sought approval for the use of Bextra : (1) for relief of

symptoms of OA ; (2) RA; (3) the treatment of primary dysmnenorrheal (menstrual cramps) ; and

(4) acute pain .

107. The FDA's approval package for Bextra was published on or about November 16 ,

2001 ("Bextra Approval") . The FDA approved the use of Bextra for (1) through (3) above, but

denied Bextra use for acute pain . The paragraphs in the Bextra Approval letter are redacted

under the headings "Safety in the management of acute pain," "Safety and efficacy in the

prevention of acute pain in adults," and a third heading which itself was redacted : "Safety and

efficacy for " (The blank at the end of the heading is in the redacted Bextra

Approval letter) .

108. The Bextra Approval included references to a large Coronary Artery Bypass Graft

("CABG") Trial (also referred to as Trial 35) which enrolled 311 patients on Bextra and 151 on a

placebo .

109 . CABG surgery is performed about 350 .000 times annually in the United States ,

making it one of the most commonly performed major operations . CABG surge ry is advised for

selected groups of patients with significant narrowing and blockages of the heart arteries

(corona ry artery disease ) . CABG surgery creates new routes around narrowed and blocked

arteries, allowing sufficient blood flow to deliver oxygen and nutrients to the heart muscles . To

be able to convince cardiothoracic surgeons to prescribe Bextra for post - CABG surgery would

have made a sizeable addition to the number of Bextra prescriptions made each year .

31

110. All safety information concerning the CABG trial was redacted from the Bextra

Approval .

111 . In the unredacted version, it is clear that sometime prior to November 2001, an

FDA medical officer noted problems with Bextra's cardiovascular safety profile, stating, inter

alia : "[t]he excess of serious cardiovascular thromboembolic [blood clots] in the valdecoxib arm

of the CABG trial . . . is of note as the entire study population received prophylactic low dose

aspirin as part of the standard of care in this setting to minimize just such events," and that

"[g]iven the emerging concern over possible pro-thrombotic actions of certain agents in the

COX-2 class, these data are of concern . "

112. The FDA's cautionary statements in the Bextra Approval were deleted from the

publicly available Bextra Approval package . The above-quoted statements by the FDA medical

officer were redacted. In their place appears the purported reason : "[the redacted information

has] been removed because it contains trade secret and/or confidential information that is not

disclosable . "

113 . As stated above, Bextra was not approved for acute pain, only for: (1) for relief

of symptoms of osteoarthritis ; (2) adult rheumatoid arthritis, (3) the treatment of primary

dysmenorrheal (menstrual cramps ) . Nevertheless , P fizer sponsored a study published in the May

2002 issue of the Journal of the American Dental Association, "The analgesic efficacy of

valdecoxib vs . oxycodone/acetaminophen after surgery" (the "DADA Bextra Article"), which

concluded that Bextra was effective in the treatment of acute pain associated with dental surgery .

A press release was issued stating as much (even though a press release announcing the

publication of a drug study for dental pain in a dental journal is unusual) .

32

114 . The JADA Bextra Article published a study by "Scirex," a contract research

organization which at the time was owned by Ornnicom, one of the world's largest advertising

companies .

115. The authors of the study knew that Bextra failed to gain FDA approval for acute

pain. Indeed, the two studies published in the JADA Bextra Article had been submitted to the

FDA in an unsuccessful attempt to gain approval of Bextra for acute pain .

116 . According to a November 22, 2002 New York Times article entitled "Madison

Ave. Has Growing Role in the Business of Drug Research," the JADA study "helped light a fire

under Bextra . "

117. Sales of Bextra increased 60 percent in the three months following the JADA

Bextra Article .

118. Following the September 30, 2004 Vioxx recall resulting from cardiovascula r

risks, in a press released dated October 15 , 2004, Pfizer disclosed the findings regarding CABG

Trial 35 . Two months later, in December 2004, P fizer quietly released all the results of CABG

Trial 35 . These previously concealed results warned of cardiovascular side effects associated

with Bextra.

119. The response from the public was an immediate outc ry . The FDA caused P fizer

to withdraw Bextra from the market and doctors who regularly prescribed Celebrex and Bextra

were now calling for more studies before prescribing Pfizer's two COX-2 inhibitors . Sales of

Bextra ceased and those of Celebrex were greatly reduced . In response to the furor over the

release of the data about CABO Trial 35, Pfizer announced that it would conduct further studies

to confirm the long-term cardiovascular safety profile of Bextra in patients who require chronic

treatment for arthritis with a COX-2 specific inhibitor .

33

B. The Truth About Celebrex And Bextra Begins To Be Revealed To The

Public

i . Merck's September 30, 2004 Announcement And Pfizer's Initial

Response

120 . On September 30, 2004, Merck withdrew Vioxx from the market . The FDA

subsequently issued a Public Health Advisory to Vioxx users, informing them of the withdrawal

and advising patients to consult with their physicians about alternative medications .

121 . Pfizer issued a statement which stated, in pertinent part : "The evidence

distinguishing the cardiovascular safety of Celebrex has accumulated over the years in multiple

completed studies, none of which has shown any increased cardiovascular risk for Celebrex."

Further, several days later, on October 1, 2004, a Chicago Tribune article quoted Pfizer's

worldwide medical director for Celebrex, Defendant Cawkwell, as follows : "The cardiovascular

data for Celebrex and Bextra in the long-term arthritis studies has been good . "

122 . Notwithstanding its initial statements in response to the Vioxx withdrawal, on o r

about October 15, 2004, Pfizer belatedly began to reveal the truth about its knowledge of dangers

in its COX-2 drugs . Pfizer issued a warning to doctors, admitting that Bextra increased the risk

of heart attack and stroke in patients undergoing coronary-bypass surgery . It further disclosed

that, not only did Bextra cause severe dermatological side effects, such as Stevens-Johnson

syndrome, but it did so more often than any other COX-2 drug .

123. On October 19, 2004, the New York Times published an article (the "October 19,

2004 Article") entitled "A New Trial of Celebrex, and Questions on Its Timing ." The October

19, 2004 Article, addressing a possible new trial of Celebrex being proposed by Pfizer, stated in

pertinent part :

[One] question is whether the new trial would be ethical and ableto attract participants, given the problems associated with Vioxxand with Bextra .

34

"I would not put any of my patients who are at high cardiovascularrisk on any drug that is a member of this class based on the currentevidence," said Dr. Garret A. FitzGerald, a cardiologist andpharmacologist at the University of Pennsylvania.

Besides questions about the new trial, there are also questionsabout why Pfizer did not disclose the data on Bextra earlier . Dr.Cawkwell acknowledged that Pfizer knew the results of the Bextratrial in bypass patients two months ago .

"I think one could only characterize their response to the Vioxxstory, where they publicly dismissed the possibility of a classeffect, as deceptive," Dr. FitzGerald said .

124. On November 10, 2004, the New York Times published an article (the "Novembe r

10, 2004 Article") entitled "New Study Links Pfizer 's Bextra, Similar to Vioxx, To Heart

Attacks." The article stated in pertinent pa rt :

The incidence of heart attacks and strokes among patients givenPfizer's painkiller Bextra was more than double that of those givenplacebos, according to preliminary results of a study presentedyesterday at the American Heart Association meeting in NewOrleans .

"The magnitude of the signal with Bextra is ever: higher thanwhat we saw in Vioxx," Dr. Garret A. FitzGerald, a cardiologist

and pharmacologist at the University of Pennsylvania, said in aninterview after presenting the data. "This is a time bomb waitingto go off. "

Dr. Curt Furberg, professor of public health sciences at WakeForest University School of Medicine, helped conduct the studythat Dr. FitzGerald announced yesterclay. "Basically, we showedthat Bextra is no differen t than Vioxx, and Pfizer is trying tosuppress that information, " Dr. Furberg said.

(Emphasis added) .

35

125 . On November 17, 2004, David Graham, associate director of the FDA's Office o f

Drug Safety, testified before the Senate Finance Committee that Bextra was one of the five mos t

dangerous drugs on the market, and posed cardiovascular risks similar to those connected wit h

Vioxx .

126 . On December 9, 2004, the FDA announced that Bextra's label would be changed

to include warnings about two potentially fatal side effects : increased risk of a severe cardia c

event such as he art attack or stroke, and increased risk of serious skin reactions such as Stevens-

Johnson Syndrome .

ii. Pfizer Finally Admits Celebrex Causes Increased Cardiovascular Ris k

127. On December 17, 2004, Pfizer started to admit what it had known since 1999, that

Celebrex increases the risk of heart a ttacks and cardiovascular problems . In an attempt to hide

its misrepresentations over the previous five years regarding the alleged cardiac safety of

Celebrex, P fizer claimed that "it received new information last night about the cardiovascular

safety of its COX-2 inhibitor Celebrex (celecoxib) based on an analysis of two long-term cance r

trials ." Pfizer, still maintaining secrecy regarding its 1999 Study, claimed that a more recen t

Adenoma Prevention with Celecoxib trial (the "APC trial"), showed that '~atients taking 400mg

and 800mg of Celebrex daily had an approximately 2.5 fold increase in their risk of

experiencing a major fatal or nonfatal cardiovascular event compared to those patients takin g

placebo. . . ." (Emphasis added) . Significantly, these data show a risk similar to, but less, tha n

Pfizer had known for years as the result of its 1999 Study. Pfizer, finally, and belatedly ,

suspended the APC trial.

128. Shortly thereafter, on December 22, 2004, European drug regulators uncovered

alarming adverse cardiovascular data relating to Celebrex . On that date, the European Medicine s

Authority ("EMEA") issued a press release stating that it had received summary data from th e

36

initial testing of Celebrex - the APC trial and another set of tests known as the "PreSAP" clinical

trials . The EMEA's preliminary assessment found a significantly increased risk of serious

cardiovascular events in the APC trial. The EM EA then decided to accelerate its review of

COX-2 inhibitors . As a part of this review, Pfizer was asked to submit data in January 2005, and

then present the information at the January 17-20, 2005 meeting of the EMEA's Committee on

Medicinal Products for Human Use .

129. On December 23, 2004, the FDA issued a public health advisory recommending

the limited use of all COX-2 inhibitors (Celebrex, Bextra and Vioxx) following recently released

data showing that the COX-2 inhibitors may be associated with an increased risk of

cardiovascular events especially when they are used for long periods of time or in very high risk

settings such as immediately after CABG surgery .

130. Pfizer's unrestrained Celebrex and Bextra marketing blitz, even in the face o f

these new reports on unresolved cardiovascular safety issues for these drugs, caused the FDA to

act . Specifically, on January 12, 2005, the FDA issued a warning letter to Pfizer in connection

with its aggressive marketing of Celebrex and Bextra, stating that the Pfizer ads (1) did not fully

disclose side effects ; and (2) made "unsubstantiated effectiveness claims . "

131 . On January 14, 2005, the FDA announced the joint public meeting of the agency's

Arthritis Advisory Committee and the Drug Safety and Risk Management Advisory Committee

to be held February 16, 17 and 18, 2005, on the benefits and risks of the COX-2 family of drugs,

which includes Pfizer's Celebrex and Bextra .

132. Sometime in January 2005, Pfizer very quietly posted the results of the 1999

Study on the PhRMA website (a website created in October 2004 for pharmaceutical companies

to post the results of clinical studies) . As noted above, the 1999 Study, which tested Celebrex as

a treatment for Alzheimer's disease, found that patients taking Celebrex had a 3 .6 times greate r

37

occurrence of serious heart events compared to those on placebo . The Company posted the

results of the 1999 Study without any public announcement . The 1999 Study was discovered by

a doctor working for the consumer group, Public Citizen . He regularly reviewed the site and

noticed during a review in late January 2005, that the 1999 Study had been added to the website,

but had not been there several weeks earlier .

133 . On January 31, 2005, based on its discovery of the 1999 Study on the PhRMA

website, Public Citizen accused Pfizer of burying the 1999 Study's findings of an increased risk

of heart attack and stroke . Public Citizen previously had filed a petition on January 24, 2005,

urging the FDA to pull both Celebrex and Bextra from the market because of links to dangerous

heart complications and accusing Pfizer of trying to hide the study . One week later, after

discovering the 1999 Study, Dr. Sidney Wolfe, Director of the Health Unit at Public Citizen

argued to the FDA that 'There is no excuse for this study not being made more public ." He

further stated that "the company [Pfizer] has set itself up for enormous liability for having failed

to inform the outside world of these important findings . "

134. The next day, the New York Times published an article entitled "Pfizer Says 1999

Trials Revealed Risks With Celebrex" (the "February 1, 2005 New York Times Article") . In that

article, Pfizer admitted that "a 1999 clinical trial found that elderly patients taking the drug

jCelebre J were far• more likely to suffer heart problems than patients taking a placebo."

(Emphasis added) .

135 . The February 1, 2005 New York Times Article further stated : "[T]he company has

acknowledged that the 1999 study, which was intended to examine whether Celebrex could treat

Alzheimer's disease, found that the number of Celebrex patients suffering heart attacks was

almost four times that of those taking a placebo . Pfizer's own analysis found the difference

statistically significant ." (Emphasis added) . Two doctors who participated in that review said

38

that they had not known about the 1999 study until [late January 2005] . One of them, Dr .

Kenneth Brandt, a professor of medicine at Indiana University School of Medicine, said that if

the safety panel had known about the study, it might have recommended that both Vioxx and

Celebrex be taken with greater caution . That panel decided to recommend [in 2001] that Vioxx,

but not Celebrex, carry a warning about its cardiovascular risks . That difference is one of the

main reasons Celebrex had greater sales than Vioxx ." (Emphasis added . )

136. The New York Times Article continued : "Dr. Cawkwell [Pfizer's medical

team leader for Celebrex] said she did not know why Pharmacia did not send the results to

the F .D .A. in time for the broader review . After Pfizer bought Pharmacia, [Pfizer] assured

patients and doctors that it had no evidence that Celebrex was dangerous ."

iii . The FDA Requires A "Black Box" Warning Label On Celebrex

137_ The FDA has specific requirements on the content and format of labeling of

human prescription drugs. One requirement concerns product label warnings . In general, the

FDA has three levels of such warnings, including, in order of the least to most serious : (a)

contraindications; (b) cautionary statements ; and (c) black box warnings .

138. A contraindication describes situations in which the prescription drug should no t

be used because the risk of use clearly outweighs the benefits . Contraindications instruct

patients not to take a particular medicine if they are taking another medication or suffering from

a pre-existing condition that would cause the patient to have a particular hypersensitivity to use

of the drug . For example, many medicines should not be used by women during pregnancy .

139. A cautionary statement describes serious adverse reactions and potential safety

hazards, limitations in use imposed by them, and the steps that should be taken should they

occur, in connection with the use of the prescription drug . Celebrex and Bextra, for example,

39

were both required to contain, since their approval by the FDA, the same cautionary statements

all NSAIDs are required to carry concerning gastrointestinal risks .

140. The black box warning is the most serious warning placed in the labeling of

prescription medication. Black box warnings are used by the FDA for special problems,

particularly those that may lead to death or serious injury. Black box warnings must be

prominently displayed in the labeling of the prescription medicine in an area determined by the

FDA. Other than pulling the drug from the market, the black box label is the most potent

warning in the FDA's arsenal, and often has a significant negative impact on a drug's sales .

Physicians tend not to prescribe drugs with a black box warning because they fear liability if an

adverse event occurs and the label clearly states why the drug should not be prescribed .

141 . On April 7, 2005, upon urging from the FDA, Pfizer agreed to insert a black box

warning in Celebrex's label . Celebrex's black box warning highlights the potential for increased

risk of cardiovascular events and gastrointestinal bleeding associated with Celebrex use .

Specifically, Celebrex's black box warning stated :

CELEBREX®celecoxib capsule s

Cardiovascular Risk

• CELEBREX may cause an increased risk of serious cardiovascular thrombotic events, myocardial

infarction, and stroke, which can be fatal . All NSAIDs may have a similar risk . This risk may increase

with duration of use . Patients with cardiovascular disease or risk factors for cardiovascular diseasemay be at greater risk (see WARNINGS and CLINICAL TRIALS) .

+ CELEBREX is contraindicated for the treatment of peri-operative pain in the setting of coronaryartery bypass graft (CABG) surgery (see WARNINGS) .

Gastrointestinal Ris k

+ NSAIDs, including CELEBREX, cause an increased risk of serious gastrointestinal adverse eventsincluding bleeding, ulceration, and perforation of the stomach or intestines, which can be fatal . These

events can occur at any time during use and without warning symptoms . Elderly patients are at

greater risk for serious gas trointestinal events (see WARNINGS) .

40

142, The inclusion of the black box yarning to Celebrex's label would turn out to be a

"death knell" for Pfizer's Celebrex drug sales . By the end of the Class Period, it became clear

that Celebrex sales had been negatively impacted by the inclusion of the above black box

warning .

143 . The FDA requested that Pfizer change the Celebrex label after considering th e

presentations, discussions and recommendations from the joint meeting of the FDA's Arthritis

and Drug Safety and Risk Management Advisory Committees held on February 16, 17 and 18,

2005. The Committees informed the FDA that "for at least the three approved COX-2 products

[Vioxx, Celebrex and Bextra], a class effect appears to be present ." The Committees also

reported that "the GI [gastrointestinal] benefits of the COX-2s appear to be less than first

reported . . . [with] no clear data drat show GI benefitfsj for Celebrex and Bextra ." (Emphasis

added) .

144 . Just weeks before being forced to add a "black box" to the Celebrex label, Pfizer

was still touting the safety of Celebrex and Bextra at the joint meeting of the Committees .

Specifically, in February 2005, at the joint meeting of the Committee, Defendant Feczko made

the following statements :

[T]he data that demonstrates the cardiovascular safety profile ofour COX-2 inhibitors, both Celebrex, Bextra and parecoxib .

We believe that this data shows that the cardiovascular safety ofCelebrex is at least on a par with therapeutic alternatives such asthe non-selective NSAIDs .

While the data for Bextra is definitely smaller, it is growing and inthe treatment of rheumatoid and osteoarthritis we believe has notshown any increased risk in cardiovascular risk . The extrapolationfrom the CABG studies has been taken as evidence that there is aproblem with Bextra overall .

41

In conclusion, I continue to be confident that Celebrex and Bextrahave important treatment options for arthritis patients . I actuallybelieve that there is no effective treatment for arthritis patients thatis safer than Celebrex .

145 . Today, Pfizer's Celebrex website states : "Important Information : CELEBREX

may increase the chance of a heart attack or stroke that can lead to death." (Emphasis added) .

iv. Pfizer Removes Bextra From The Market

146 . On April 7, 2005, in the same press release in which it announced the "black box"

label for Celebrex, Pfizer announced that it had been told by the FDA to remove Bextra from the

market. Pfizer stated that :

Pfizer respectfully disagrees with FDA's position regarding the

overall risk/benefit profile of Bextra . However, in deference to the

agency's views, the company has agreed to suspend sales of the

medicine pending further discussions with the FDA . Pfizer said it

will explore options with the agency under which the companymight be permitted to resume making Bextra available to

physicians and patients . For now, patients should stop takingBextra and contact their physicians about appropriate treatment

options .

147. In response to the removal of Bextra, drug industry analyst C .J . Sylvester at Banc

of America said the Bextra withdrawal took him by surprise, noting it came just two days after

Pfizer executives said sales of the arthritis drugs would be reinvigorated in coming months .

Sylvester wrote in a research report that : "The big surprise is the FDA's request for the

withdrawal of Bextra given that the advisory committee (to the FDA) voted that Bextra should

remain on the market back in mid-February." He further wrote : "We don't believe [Pfizer]

anticipated a Bextra removal and the'black box' label for Celebrex won't help prescription trends

and may actually" hurt sales of the drug .

42

v. Pfizer Admits The Financial Impact Of Its Prior False Statements

148. On April 19, 2005, Pfizer filed a Form 8-K with the SEC attaching a press releas e

(the "April 19, 2005 Form 8-K") discussing Pfizer's financial results for the first quarter of 2005 .

The April 19, 2005 Form 8-K misleadingly did not reveal the full truth known or recklessly

disregarded by Pfizer about Celebrex and Bextra cardiovascular risks . It did disclose, however,

the financial impact of Pfizer's April 7, 2005 decision to suspend Bextra sales, thereby

underscoring Pfizer's reason for concealing Bextra's and Celebrex's cardiovascular risks in the

first place :

On April 18, 2005, the Company determined that certain intangibleassets relating to Bextra, one of our selective Cox -2 inhibitor painrelievers, have become impaired due to our decision, announced onApril 7, 2005, to suspend the sales of Bextra. The Companyrecorded certain charges totaling $1 .213 billion ($766 million, netof tax) in the first quarter of 2005 .

149. Finally, on October 20, 2005, in the early morning before the market opened ,

Pfizer announced: "The regulatory actions relating to Celebrex and the suspension of sales of

Bextra have contributed to an additional decline in third-quarter 2005 selective COX-2 inhibitor

worldwide revenues of $754 million (down 67 percent) and year-to-date selective COX-2

inhibitor worldwide revenues of $2 .0 billion (down 62 percent) in comparison to the same

periods in the prior year . "

150. The stock market has responded to the negative disclosures about Bextra an d

Celebrex, and, in particular, the withdrawal of Bextra from the market and the FDA's decision to

issue a "black box" warning label on Celebrex with a massive sell-off of Pfizer stock . During

the Class Period, from October 31, 2000 through October 19, 2005, Pfizer rose to a high of

$47.44 per share before falling to $21 .09 upon Pfizer's October 20, 2005 disclosure of Celebrex's

low sales. This stock price loss represents a drop of approximately $137 .9 billion in market

43

capitalization . From October 18, 2004 to October 26, 2005, Pfizer's stock price fell $7 .94, from

$29.00 to $21 .06, for a loss in market capitalization of $58 .5 billion for that period alone .

VII. GOVERNMENTAL ACTIONS AND REGULATORY INVESTIGATIONSRELATED TO CELEBREX AND BEXTRA

A. The DOJ And SEC Investigations Regarding Celebrex And Bextr a

151 . Almost immediately after Merck made its September 30, 2004 announcemen t

withdrawing Vioxx from the market, regulatory authorities commenced immediate investigations

into Pfizer's conduct concerning the sale and marketing of Celebrex and Bextra . The primary

objective of the investigations was to determine the Defendants' knowledge of the dangers tha t

Celebrex and Bextra posed before and after the FDA approved the drug for prescription use .

i . The DOJ Investigation

152. In the fall of 2004, in response to the announcements by Merck and Pfize r

regarding safety issues with COX-2 drugs, the U .S. Department of Justice ("DOJ") and a grou p

of state attorneys general requested internal Pfizer documents about the marketing and safety o f

both Celebrex and Bextra .

153 . Although the Company did not disclose the scope of the DOJ's investigation ,

industry experts believe the DOJ will examine, among other things, whether the Defendant s

misled regulators and/or manipulated federal health programs such as Medicare and Medicai d

into paying for prescriptions of Celebrex and Bextra even when its use was not warranted .

154. The DOJ also investigated Pfizer's aggressive marketing practices . On Maith 10 ,

2004, the Associated Press reported that the DOJ was investigating Pfizer's Bextra marketing

and sales practices :

Pfizer Inc . said in a regulatory filing on Wednesday that the JusticeDepartment was investigating its sales and marketing practices fortwo drugs, along with certain management care payments .

44

Pfizer said the drugs under investigation were human growthhormone Genotropin and arthritis medication Bextra . Pfizer

wouldn't comment beyond its 10K filing with the Securities andExchange Commission . The Justice Department also declined to

comment .

ii . The SEC Investigation

155 . On August 8, 2005, Pfizer announced it is responding to a request from the SE C

for information and documents on its Bextra and Celebrex painkillers . The SEC made th e

request in the second quarter of 2005, according to Pfizer's spokeswoman who further stated tha t

the Company had no further comment on the SEC's request, except that it was cooperating .

156. The SEC is expected to examine whether Pfizer fully disclosed to the Company' s

investors information that the Defendants possessed concerning Celebrex and Bextra's risks an d

the corresponding threat to Celebrex and Bextra's medical and commercial viability . It is al so

typical for the SEC to examine whether corporate insiders profited based upon their earl y

knowledge of adverse news .

B. FDA Action

157. On or about January 10, 2005, the FDA issued to Pfizer a Warning Letter about

Celebrex ("Janua ry 10, 2005 Warning Letter" ) . The January 10, 2005 Warning Letter described

a number of problems with five separate Celebrex advertisements : (1) a 15-second direct-to-

consumer (`DTC') television ad, featuring a guitar ; (2) a 30-second television DTC

advertisement entitled "Celebrex Presents Arthritis Tips ;" (3) a print advertisement directed to

health care providers entitled "Strength They Can Stay With ;" (4) a direct mail patient brochure

for Bextra ; and (5 ) a 27-minute television DTC infomercial entitled "On the Road to Joint Pai n

Relief."

158. The January 10, 2005 Warning Letter stated :

These five promotional pieces variously : omit material facts,including the indication and risk information ; fail to make

45

adequate provision for the dissemination of the FDA-approvedproduct labeling; and make misleading safety, unsubstantiatedsuperiority, and unsubstantiated effectiveness claims . They are,therefore, in violation of the Federal Food, Drug and Cosmetic Act(Act) and FDA implementing regulations .

159. On April 7, 2005, upon urging from the FDA, Pfizer agreed that Celebrex would

carry a black box warning label. On that same day, the FDA told Pfizer to remove Bextra from

the market .

VIII. CLASS PERIOD EVENTS AND THE DEFENDANTS' FALSEAND MISLEADING STATEMENT S

A. Pre-Class Period Events And False And Misleading Statements

160. On February 15, 2000, Pfizer issued a press release entitled "Newly Published

Study Confirms Celebrex® Does Not Interfere With Platelet Function Findings Important for

Arthritis Patients Taking Low-Dose Aspirin" (the "February 15, 2000 Press Release") . In the

February 15, 2000 Press Release, Pfizer stated that "[a] double-blind, randomized, placebo-

controlled study published in this month's Journal of Clinical Pharmacology concludes that

COX-2 specific inhibitor Celebrex® (celecoxib capsules) does not interfere with platelet

function, even at 1200 mg per day, which is six times the recommended daily dose for

osteoarthritis ." The February 15, 2000 Press Release further stated that "[t]his benefit meshes

nicely with the fact that at recommended doses, there doesn't appear to be any dose-related

increase in the cardiovascular-related side effects of hypertension of peripheral edema."

(Emphasis added) .

161 . On February 22, 2000, Pfizer issued a press release (the "February 22, 2000 Press

Release") entitled "Celebrex Sets Industry Records in First Year Generating 19 Million

Prescriptions : An Estimated Seven Million Patients ." The February 22, 2000 Press Release

stated, in part :

46

Marking the one-year anniversary of the record-setting COX-2

specific inhibitor, Searle and Pfizer Inc . reported Way that . . .

Celebrex [was] the most successful pharmaceutical launch in U .S.

history .

"The overwhelming response to Celebrex, including the number ofpatients who are continuing on the product, is a clear signal that

this is a safe and effective arthritis medication that can be usedfor the long terra. "

(Emphasis added) .

162. On February 29, 2000, Pfizer issued a press release (the "February 29, 2000 Pres s

Release") entitled "Celebrex® At One Year : Helping Many Return To Daily Activities ;

Innovative Arthritis Drug Taken By An Estimated Seven Million People ." The February 29 ,

2000 Press Release stated, in part :

Driven by a motivated patient population seeking an effective, welltolerated anti-arthritic medication , Searle and Pfizer Inc . reportedtoday tint Celebrex® (celecoxib capsules) in its first yeargenerated an unprecedented 19 million prescriptions, a volumeunrivaled by any other prescription drug in its first year.

(Emphasis added) .

163 . On April 6, 2000, Pfizer issued a press release (the "April 6, 2000 Press Release"')

entitled "Celebrex& Study Shows Once-daily Dose As Effective As Twice-daily Dose for

Osteoarthritis ." The April 6, 2000 Press Release stated that "[a] recently published study of

almost 700 osteoarthritis (OA) patients has found that a single daily dose (QD) of 200 Ong of

Celebrex® (celecoxib capsules) is just as effective and safe as two daily doses (BID) of 100 Ong

each for the treatment of the pain and inflammation of OA ." (Emphasis added) .

164 . On April 17, 2000, Pfizer issued a press release (the "April 17, 2000 Pres s

Release") entitled "New Findings Presented on Celebrex® Safety and Tolerability From Long-

Term Outcomes Study of 8,000 Arthritis Patients -- Long-term safety studied in major organ

47

systems, at 4 times the OA dose -- Ibuprofen and diclofenac found to cause significantly greate r

GI blood loss than Celebrex ." The April 17, 2000 Press Release stated :

In a landmark study to assess the overall long-term safety of theCOX-2 specific inhibitor Celebrexfl (celecoxib capsules), arthritispatients taking four times the recommended osteoarthritis (OA)

dose of the drug experienced fewer symptomatic gastrointestinal(GI) ulcers and ulcer complications than patients taking ibuprofen

and diclofenac -- a difference that was statistically significantbased on a combined analysis of Celebrex versus these twotraditioml nonsteroidal anti- inflammatory drugs (NSAIDs) . . .

Importantly, Celebrex showed no increase in thromboembolic orother cardiovascular-related events, even among non-aspirin

Users.

Furthermore, Celebrex showed no increases in throinboembolic

events (such as myocardial infarctions and stroke) or othercardiovascular adverse events compared with the traditional

NSAID comparators. This is an important finding in light of thefact that about 40 percent of patients in each arm of the study had a

history of cardiovascular disease, and about half of these patients

were taking low-dose aspirin .

(Emphasis added) .

165. On April 18, 2000, Pfizer issued its financial results for the first quarter of 2000 ,

ended April 2, 2000, in a press release (the "April 18, 2000 Press Release") . The April 18, 2000

Press Release stated that "Celebrex is receiving, over 400,000 weekly total U .S. prescriptions and

is the [#€]I prescribed arthritis brand in the U .S ." The April 18, 2000 Press Release further stated

that "Celebrex showed no increase in throrrrboembolic or other cardiovascular-related events ,

even among non -aspirin users." (Emphasis added) .

166. On April 28, 2000, Pharmacia issued a press release (the "April 28, 2000 Press

Release") entitled "New Study Validates Safety of Pharmacia Corporation's Celebrex on Stroke ,

Heart Attack Issues ." The April 28 , 2000 Press Release discussed the results of the CLASS

Study. It stated :

48

Recent news reports have associated Vioxx (rofecoxib), atreatment for osteoarthritis and pain, with stroke and heart attacks .

It has been suggested that this may be an effect common to COX-2

inhibitor compounds. However, new data reaffirm that this is not

the case for Pharrnacia Corporation's innovative COX-2 specificinhibitor, Celebrex® (celecoxib capsules) .

A landmar k sturdy just released continues to demonstrate a strongsafety profile for Celebrex, which is not only indicated forosteoarthritis but also rheumatoid arthritis .

Even at these very high doses, Celebrax showed no increases instroke or heart attack with or without aspirin. The Celebrex datathus indicate that there is no class-related issue on this importantsafety parameter, suggesting that any potential risk associated withVioxx may be specific to that compound .

(Emphasis added) .

167. On May 23, 2000, Pfizer issued a press release (the "May 23 , 2000 Pres s

Release") entitled "Findings from Celebrex® Safety Study Show Traditional NSAID

Comparators Can Cause Serious GI Complications Within First Few Days of Treatment ; No

Increased Risk of GI Complications Observed for H . Pylori Positive Patients on Celebrex ." The

May 23, 2000 Press Release contained the following materially false and misleading statements

and/or omissions of material fact :

New data from the Celebrex® (celecoxib capsules) long-termsafety study presented during Digestive Disease Week (DDW)revealed that the risk for serious gastrointestinal complications

with the NSAID comparators ibuprofen and diclofenac can startwithin the first few days after treatment begins . Further, study

patients who were H . pylori positive had a two times greater risk ofdeveloping both symptomatic ulcers and ulcer complications whentaking the NSAID comparators than did H . pylori negative

patients . No such increase was observed with patients takingCelebrex, regardless of H . pylori status .

Cardiovascular Findings

49

The long-terra safety study also indicated that four times the

recommended OA (lose of Celebrex, taken with or without

aspirin, posed no increased risk of heart attacks or strokes

compared with ibuprofen and diclofenac. Approximately 70

percent of the aspirin group and 50 percent of non-aspirin usershad cardiovascular risk factors such as hypertension, highcholesterol, tobacco use and a history of heart attacks .

(Emphasis added) .

168. On June 22, 2000, Pfizer issued a press release (the "June 22, 2000 Pres s

Release") entitled "In Large Head-to-Head COX-2 Inhibitor Safety Study, Vioxx® Associate d

with Significant Increases in Blood Pressure and Edema vs . Celebrex®." The June 22, 2000

Press Release contained, inter alia, the following materially false and misleading statement s


New data derived from the first-ever head-to-head safety studypresented that compares Pharmacia's COX-2 inhibitor Celebrex0(celecoxib capsules) with Merck's Vioxx® (rofecoxib) show that

hypertensive osteoarthritis (OA) patients taking Vioxx experiencedstatistically significantly more increases in edema (1) and systolic

blood pressure compared with those taking Celebrex . . . .

Speci fically, Vioxx-treated patients experienced a two-foldincrease in clinically signi ficant edema con-pared to the Celebrex-

treated patients . Of greater importance , results reveal that withintwo weeks of the sta rt of the study, signi ficantly more patients on

Vioxx had clinically meaningful increases in systolic bloodpressure (greater than or equal to 20 mmHg) versus those on

Celebrex .

169. The foregoing pre-class period statements failed to disclose material advers e

information then known by or recklessly disregarded by the Defendants concerning th e

cardiovascular and thrombotic risks associated with Celebrex, demonstrated in the 1999 Study ,

by falsely claiming that Celebrex does not increase cardiovascular -related side effects. These

pre-class period statements should have disclosed information about Celebrex, such as that

mandated by the FDA in the "black box" warning Celebrex now carries concerning theZ:) M

cardiovascular risks associated with its use .

50

B. Beginning Of The Class Perio d

170. On October 31, 2000, Pfizer issued a press release (the "October 31, 2000 Press

Release") entitled "New Head-to-Head Study Showed Celebrex and Vioxx Comparable Efficacy

For the Treatment of Osteoarthritis ; In Separate Head-To-Head Safety Study, Vioxx Associated

With Significant Increases in Blood Pressure and Edema Versus CELEBREX ." The October 31,

2000 Press Release contained the following materially false and misleading statements and/or

omissions of material fact :

In a separate head-to-head safety study, CELEBREX was shown tooffer improved renal safety over Vioxx .

"In the study, CELEBREX caused significantly fewer adverserenal side effects than Vioxx . . . This study provides compellingevidence that CELEBREX and Vioxx affect hypertensive arthritispatients differently, suggesting that not all COX-2 inhibitors arethe same."

The October 31, 2000 Press Release made false and misleading statements regarding the safety

of Celebrex in that it failed to disclose material adverse information then known by or recklessly

disregarded by the Defendants concerning the cardiovascular and thrombotic risks associated

with Celebrex, demonstrated by the 1999 Study, by misrepresenting that Celebrex posed no

problems to consumers in comparison with the safety issues linked to Merck's Vioxx . The

October 31, 2000 Press Release should have disclosed information about Celebrex, such as that

mandated by the FDA in the "black box" warning Celebrex now carries concerning the


171 . On November 1, 2000, Pharmacia filed a Form 8-K with the SEC (the 'November

1, 2000 8-K") which stated, in part :

During the quarter, results of a landmark long-term study of 8,000patients with osteoarthritis (OA) and adult rheumatoid arthritiswere published in the Journal of the American Medica l

51

Association (JAMA). The study found that patients treated withCelebrex experienced two-to-threefold fewer gastrointestinalcomplications than patients treated with two other arthritismedications studied, even at four times the recommended OA dose

of Celebrex . Celebrex showed a positive renal and hepatic profile

with no increase in thromboembolic or other cardrovascular-related events .

(Emphasis added) . The November 1, 2000 8-K made false and misleading statements regarding

the cardiovascular safety of Celebrex in that it failed to disclose material adverse information

then known by or recklessly disregarded by the Defendants concerning the cardiovascular and

thrombotic risks associated with Celebrex, demonstrated by the 1999 Study, by falsely claiming

that Celebrex showed no increase in thromboembolic or cardiovascular-related events . The

November 1, 2000 8-K should have disclosed information about Celebrex, such as that mandated

by the FDA in the "black box" warning Celebrex now carries concerning the cardiovascular risks

associated with its use .

C. Analysts Embrace The Defendants ' False And Misleading Statements In2000

172. During the entire calendar year of 2000, analysts followed the Defendants' publi c

statements and announcements closely in connection with reporting Company developments to

investors. Analysts routinely repeated the Defendants' materially false and misleading

statements, whether appearing in press releases, financials or the advertisements themselves, all

of which failed to disclose material facts, and utilized such statements as the basis for

recommending that investors purchase the Company's stock . The following examples reflect

this showing of the market through false and misleading information that relentlessly hyped the

drugs but never mentioned their serious cardiovascular risks :

• On April 19, 2000, A.G. Edwards & Son, Inc . issued a report on Pfizer, rating theCompany a "Buy." It further stated: "The Celebrex launch has proven to be agreat success . Celebrex has been achieving total prescriptions averaging over404,000 per week (last 12 weeks) . During its first year, Celebrex achieved th e

52

highest level of first-year sales of any drug in history, with third-party sales ofapproximately $1 .5 billion; "

On May 2, 2000, Deutsche Bank issued a report on Pfizer, rating the Company a

"Strong Buy ." It further stated that "Celebrex is already annualizing at a rate of

$2.2 billion, and should benefit from the recently released CLASS trial data whichdemonstrated the long term safety of the COX-2 inhibitor, as patients on 4 times

the recommended dose of Celebrex experienced fewer GI ulcers and ulcer

complications than those on ibuprofen or diclofenac . Along with Merck's Vioxx,these drugs are rapidly expanding the arthritis marketplace in dollars as they

displace less expensive older NSAIDs . Ultimately, Celebrex could achieve peak

sales of $3 billion ;"

On October 25, 2000, Bear Stearns issued a report on Pfizer, rating the Company"Attractive," with a target price of $50. It further stated that "[a]lliance revenues(Celebrex and Aricept + 63%) were strong and in- line with expectations" and that"[a]lliance revenues are expected to contribute the majority of sales and earningsgrowth over the next few years."

D. 2001 Events And False And Misleading Statements

173. During the time period from January 1, 2001 through December 31, 2001, th e

Defendants made and/or caused to be issued numerous materially false and misleading

statements and/or omissions of material facts (i) related to the safety of Celebrex and Bextra

(including studies of COX-2 inhibitors ); (ii) made false adve rtisements to the general public ; and

(iii) described the launch of Celebrex and Bextra in glowing terms without telling the behind-the-

scenes problems of which Pfizer was aware .

174. On January 24, 2001, Pfizer issued a press release announcing its fourth quarter

2000 and fiscal year 2000 financial results (the "Fiscal Year 2000 Press Release") . The Fisca l

Year 2000 Press Release contained the following materially false and misleading statement s


Q19) How is Celebrex performing?

A19) Pfizer and Pharmacia Corporation, the company thatdiscovered and developed Celebrex, co-promote this product for

relief of the pain and inflammation of osteoarthritis (OA) and adultrheumatoid arthritis (RA) in most major world markets . Celebrex

remains the most successful drug launch in the history of th e

53

pharmaceutical industry, as measured both by its first year on themarket and by its continued performance in its second year.

Celebrex provides unsurpassed efficacy, outstanding tolerability,and a super ior safety profile to Vioxi.

In a long-term outcomes study of 5,800 OA patients and 2,200 RApatients, patients taking four times the recommended OA and twice

the recommended RA dose of Celebrex experienced fewersymptomatic gastrointestinal ulcers and ulcer complications than

patients taking ibuprofen and diclofenac, a difference that was

statistically significant . Celebrex showed no increase inthromboembolic or other cardiovascular -related events, even

among non -aspirin users. Celebrex also was associated with asignificantly lower incidence of blood loss than ibuprofen or

diclofenac, an event that can often signa l serious hidden damage

throughout the GI tract .

(Emphasis added) . The Fiscal Year 2000 Press Release made false and misleading statements

regarding the cardiovascular safety of Celebrex in that it failed to disclose material adverse

information then known by or recklessly disregarded by the Defendants concerning the

cardiovascular and thrombotic risks associated with Celebrex, demonstrated by the 1999 Study,

by falsely claiming that Celebrex showed no increase in thromboembolic or cardiovascular

related events. The Fiscal Year 2000 Press Release should have disclosed information about

Celebrex, such as that mandated by the FDA in the "black box" warning Celebrex now carries

concerning the cardiovascular risks associated with its use. The Fiscal Year 2000 Press Release

also made false and misleading statements in that it misrepresented that Celebrex offered an

unsurpassed efficacy, tolerability and safety profile compared to Vioxx .

175 . On April 18, 2001, Pfizer issued a press release announcing its first quarter 2001

financial results (the "First Quarter 2001 Press Release") . The First Quarter 2001 Press Release

contained, inter alia, the following materially false and misleading statements and/or omissions

of material fact :

Ql6) How is Celebrex performing?

54

A16) Pfizer and Pharmacia Corporation, the company thatdiscovered and developed Celebrex, co-promote this product forrelief of the pain and inflammation of osteoarthritis (OA) and adultrheumatoid arthritis (RA) in most major world markets. Celebrexremains the most successful drug launch in the history of thepharmaceutical industry, as measured by both its first and secondyears on the market . Celebrex provides unsurpassed effrcacy,outstanding tolerability, and a superior safety profile to Vioxx.

Celebrex was tested in more than 50 clinical trials that involvedmore than 13,000 patients and healthy volunteers in 23 countries .In these trials, Celebrex was shown to be as effective as themaximum recommended dose of the prescription - strengthnonsteroidal anti- inflammatory drugs (NSAID) naproxen andibuprofen in treating arthritis pain and inflammation .

Q17) What is the status of revised labeling for Celebrex reflectingthe results of the CLASS Study?

A17) Pfizer and Pharmacia have received an approvable letterfrom the FDA for revised labeling for Celebrex . The approvableletter is in response to the Supplemental New Drug Applicationseeking changes to the prescribing information to include results ofthe CLASS trial . Pfizer and Pharmacia are confident that allprevious studies, including CLASS, comparing Celebrex totraditional NSAIDs in Tproximately 20,000 patients, as well aspost-marketing surveillance in more than 12 million patients andnearly 2 million patient-years of exposure, have demonstrated thatCelebrex is effective and well tolerated and offers an excellent GIsafety profrla

(Emphasis added) . The First Quarter 2001 Press Release made false and misleading statement s

regarding the cardiovascular safety of Celebrex in that it failed to disclose material advers e


cardiovascular and thrombotic risks associated with Celebrex, demonstrated by the 1999 Study ,

by falsely claiming that Celebrex offered an excellent and superior efficacy, tolerability an d

safety profile compared to Vioxx and traditional NSAIDs . The First Quarter 2001 Press Release

should have disclosed information about Celebrex, such as that mandated by the FDA in th e

55

"black box" warning Celebrex now carries concerning the cardiovascular risks associated wit h

its use.

176. On October 17, 200 1, Pfizer issued a press release announcing its third quarter

2001 results (the "Third Quarter 2001 Press Release" ) . The Third Quarter 2001 Press Release

contained the following materially false and misleading statements and/or omissions of materia l

fact :

Q 18) How is Celebrex performing?

A18) Celebrex continues to perform very well . Celebrex remains

the most successful drug launch in the history of thepharmaceutical industry, as measured by both its first and secondyears on the market. Celebrex is receiving more than 440,000

average weekly total U .S . prescriptions, which make it the #1prescribed arthritis brand in the U.S . . . . Celebrex provides strongefficacy, outstanding tolerability, and a superior safety profile toVioxx . . . .

Celebrex has an excellent, well-documented gastrointestinal andcardiorenal safety profile . The safety of Celebrex has been fully

demonstrated in the extensive clinical trials reviewed by the FDAas part of the approval of Celebrex and confirmed in numerouspost-approval clinical settings that have been widely published, aswell as in real world use, including more than 21 million patientsto date . Properly conductecl, well-controlled clinical trials have

consistently shown that Celebrex poses no increaser) risk forheart attack compared to the traditional NSAIDs studied,medications that have been widely used to treat arthritis for

decades . The FDA reviewed these studies, and has concluded thatCelebrex is not associated with a greater cardiovascular riskcompared to traditional NSA[Ds studied .

We have conducted two large studies in almost 2,000 elderlypatients who had stable hypertension . We observed thatsignificantly more patients on Vioxx as compared to Celebrex hadclinically significant increases in peripheral edema . Additionally,significantly more patients in the Vioxx treatment groupdemonstrated clinically significant increases in their systolic bloodpressure . Also, patients on Vioxx have an approximate 3 mm/Hgincrease in systolic blood pressure compared to Celebrex .Cardiologists have told us that a rise in the mean systolic bloo d

56

pressure of as little as 3mm/Hg, if sustained, could increase therisk of a person having a heart attack, stroke, or othercardiovascular events . There were no statistically significantdifferences between treatments for diastolic blood pressure .

(Emphasis added ) . The Third Quarter 2001 Press Release made false and misleading statement s




by misrepresenting that clinical trials have consistently shown that Celebrex poses no increased

risk for heart attack compared to the traditional NSAIDs, and falsely claiming that Celebrex

provides a superior safety profile in comparison to Merck's Vioxx. The Third Quarter 2001

Press Release should have disclosed information about Celebrex . such as that mandated by the

FDA in the "black box" warning Celebrex now carries concerning the cardiovascular risk s


177. On November 13, 2001 Pfizer issued a press release (the "November 13, 200 1

Press Release") entitled "Analysis of Celebrex® Safety Data Show No Increased Risk o f

Cardiovascular Adverse Events Compared to NSAIDs Studied ." The November 13, 2001 Press

Release contained the following materially false and misleading statements and/or omissions o f

material fact :

An analysis of safety data, representing over 13,000 patients fromthe new drug application (NDA) and 8,000 patients in theCelecoxib Long-term Arthritis Safety Study (CLASS), supportsthat CELEBREX® (celecoxib capsules) is not associated with anincreased risk of cardiovascular (C ) adverse events compared tothe NSAXDs studied.

(Emphasis added). The November 13, 2001 Press Release made false and misleading statement s



57


by falsely claiming that Celebrex is not associated with an increased risk of adverse

cardiovascular events compared to certain NSAIDs . The November 13, 2001 Press Release

should have disclosed information about Celebrex, such as that mandated by the FDA in th e


its use .

178. On November 19, 2001, Pfizer in a press release announced the approval of its

second - generation COX-2 inhibitor, Bextra (the "Bextra Approval Press Release" ) . The Bextr a

Approval Press Re lease contained the following materially false and misleading statements


Pharmacia Corporation (NYSE : PHA) and Pfizer Inc (NYSE : PFE)today announced that the U .S. Food and Drug Administration(FDA) has approved BEXTRA® (valdecoxib tablets), a COX-2specific inhibitor, for treating the signs and symptoms ofosteoarthritis (OA) and adult rheumatoid arthritis (RA) ; and thetreatment of pain associated with menstrual cramping .

BEXTRA, which is indicated for arthritis in a once-a-day 10 mgdose, offers 24-lour arthritis pain relief. In global clinical trialsinvolving more than 5,000 patients, BEXTRA demonstratedcomparable efficacy while offering an inproved gastrointestinalsafety and tolerability profile versus conventional NSAIDs studied,specifically naproxen, ibuprofen and diclofenac. In controlledarthritis trials, the use of BEXTRA at the recommended (lose hasnot been associated with any increased risk of cardiovascular orrenal complications versus NSAIDs studied. For menstrual pain,the recommended dose of BEXTRA is 20 mg, administered twicedaily as needed. Approximately 80 percent of women in theclinical trials required only one dose of medication within the first24 hours .

(Emphasis added) . The Bextra Approval Press Release made false and misleading statements

regarding the cardiovascular safety of Bextra in that it failed to disclose material adverse


cardiovascular and thrombotic risks associated with Bextra , demonstrated in CABG Trial 35, b y

58

falsely claiming that Bextra offered an improved efficacy, tolerability and safety profile

compared to traditional NSAIDs _

E. Analysts Embrace The Defendants ' False And Misleading Statements In

2001



investors . Analysts routinely repeated the Defendants' materially false and misleading


of which failed to disclose material facts, and utilized such statements as the basis for

recommending that investors purchase the Company's stock . For example :

• On January 25, 2001, Deutsche Banc Alex Brown , Inc. issued a repo rt on

Pfizer, rating it "Market Perform " It further stated : "ALLIANCEREVENUES totaled $348 million, gaining 63% . . . versus one year ago, due tothe co-promotion of Celebiex and Aricept . Celebrex continues to do well ; "

• On April 18, 2001, A.G . Edwards & Sons, Inc . issued a report on Pfizer, ratingit a 'Buy." It further stated that "data regarding U .S. prescriptions of Celebrex

indicate year-to-date prescription growth of 18%. We expect s ales of Celebrexto reflect similar growth for 2001 ;"

On October 18, 2001, Bear Stearns issued a report on Pfizer, rating it"Attractive," with a target price of $45-48. It fu rther stated that 'PFE [P fizer]

management stated they were confident that the upcoming label changes forCelebrex would be differentiated from Vioxx (Merck ), potentially conveying a

marketing advantage . "

F. 2002 Events And False And Misleading Statement s

180 . During the time period from Janua ry 1, 2002 through December 31, 2002, the


statements and/or omissions of material facts (i) related to the safe ty of Celebrex and Bextra

( including studies of COX-2 inhibitors) ; and (ii) made false advert isements to the general public .

181 . On January 23, 2002, Pfizer issued a press release announcing its fourth qua rter

and full-year 2001 financial results (the "Full Year 2001 Press Release") . The Full Year 200 1

59

Press Release contained, inter alga, the following materially false and misleading statements


Q20) How is Celebrex performing ?

A20) . . . Celebrex provides strong efficacy, outstandingtolerability, and a superior safety profile to Vioxx. Theseadvantages have translated into a higher refill rate, higher patientsatisfaction level, and higher persistence of use for Celebrex . Withthe recent approval for acute pain and primary dysmenorrhea in theU.S., Celebrex is now the selective COX-2 inhibitor approved totreat the broadest range of painful conditions .

While the issue of cardiovascular safety has been raised for

Vioxx, we thoroughly reviewed our Celebrex NDA database forsuch findings and found no evidence . In CLASS, a longtermoutcome trial of more than 8 ,000 patients conducted at a Celebrexdose that was four times the recommended dose for osteoa rthritis,Celebrex demonstrated no increased incidence of myocardialinfarction , cerebral vascular accidents , hypertension, or peripheraledema when compared to ibup rofen and diclofenac .

Q22) What is the status of Bextra?

A22) Bextra was approved by the FDA on November 16, 2001, forthe relief of pain and inflammation of osteoarthritis (OA), adultrheumatoid arthritis (RA), and primary dysmenorrhea. Bextraoffers once-daily dosing for OA and RA patients . The product hasa significantly lower incidence of gastroduodenal ulcers vs .traditional NSAIDs (naproxen, ibuprofen, and diclofenac) andsignificantly less dyspepsia vs . naproxen .

(Emphasis added) . The Full Year 2001 Press Release made false and misleading statements




by falsely claiming that Celebrex posed no cardiovascular problems to consumers and offered a

superior safety profile in comparison with the safety issues linked to Merck's Vioxx . The Ful l

60

Year 2001 Press Release should have disclosed information about Celebrex, such as tha t

mandated by the FDA in the "black box" warning Celebrex now carries concerning th e

cardiovascular risks associated with its use . The Full Year 2001 Press Release also made fals e

and misleading statements in that it misrepresented that Bextra offered a strong efficacy ,

tolerability and safety profile compared to traditional NSAIDs when, in fact, the Defendants

knew that Bextra created certain cardiovascular and thrombotic risks as demonstrated in CAB G

Trial 35 .

182 . On June 7, 2002, Pfizer issued a press release (the "June 7, 2002 Press Release")

entitled "FDA Approves New CELEBREXT"' (Celecoxib) Prescribing Information ; New Data

Included F rom CLASS Study." The June 7, 2002 Press Release contained the following fals e

and misleading statements and/or omissions of material fact :

New label reaffirms the GI and CV safety profile of CELEBRE X

Specifically, the new prescribing information includes additionalGI safety data from CLASS . Importantly, the ►evised label alsoincludes data indicating that there was no increased risk forserious CV[cardiovascular] adverse events observed compared tothe non-specific NSAID comparators (diclofenac and ibuprofen) .These CV events included heart attack, stroke and unstableangina.

The revised label reaffirms the cardiovascular safety profile ofCELEBREX. Analysis of the safety data from CLASS showsthere were no signf cant differences between treatment groups inthe overall incidence of serious CV tlrromboerrrbolic adverseevents, such as heart attack, stroke and unstable angina.

(Emphasis added) . The June 7, 2002 Press Release made false and misleading statement s




61

by misrepresenting that Celebrex posed no increased risk for serious cardiovascular adverse

events . The June 7, 2002 Press Release should have disclosed information about Celebrex, such

as that mandated by the FDA in the "black box" warning Celebrex now carries concerning the

cardiovascular risks associated with its use.

183 . On July 15, 2002, the Associated Press reported Pfizer's plans to purchase

Pharmacia for $60 billion in an all-stock deal .

184 . In addition, on July 15, 2002, Pfizer announced its financial results for the secon d

quarter of 2002, which it fi led as a Form 425 with the SEC on the same day (the "Second Quarter

2002 Press Release") . The Second Quarter 2002 Press Release entitled "Pfizer Announces

Second Quarter 2002 Results, Reaffirms Strong Outlook for Full- Year 2002" contained the

following materially false and misleading statements and/or omissions of material fact :

Q11) HOW IS CELEBREX PERFORMING ?

All) . . . In June, after a comprehensive review of the Celecoxib

Long-term Arthritis Safety Study (CLASS) data, the FDAapproved revised labeling for Celebrex. The new prescribing

information includes additional gastrointestinal (GI) safety data

showing the estimated cumulative incidence of upper GI ulcercomplications and symptomatic ulcers for Celebrex patients at

0 .78% versus an annual NSAID category rate of 2-4% .

Additionally, the revised label also includes data indicating thatthere was no increased risk for serious cardiovascular (Ci)

adverse events observed compared to the non-specific NSA 11)comparators (dicloferrac and ibuprofen) . These CV events

included heart attack, stroke, and unstable angina.

Q20) HOW IS THE BEXTRA LAUNCH GOING ?

A20) Bextra was launched in the U .S . in April 2002 for the reliefof pain and inflammation of osteoarthritis (OA), adult rheumatoidarthritis (RA), and primary dysmenorrhea . . . Pfizer and PharmaciaCorporation, the company that discovered and developed Bextra,co-promote this product in most major world markets . . . Theproduct has a significantly lower incidence of endoscopicallydetected gastroduodenal ulcers versus traditional NSAID s

62

(naproxen . ibuprofen , and diclofenac) and significantly lessdyspepsia versus naproxen . In controlled comparative arthritistrials of up to 26 weeks, Bextra in daily doses of 10 mg or 20 Ongdemonstrated an incidence of edema and hypertension similar tocomparator NSAIDs .

(Emphasis added ) . The Second Quarter 2002 Press Release made false and misleadin g,

statements regarding the cardiovascular safety of Celebrex in that it failed to disclose material

adverse information then known by or recklessly disregarded by the Defendants concerning the


by falsely claiming that there was no increased risk for serious cardiovascular adverse events

associated with Celebrex . The Second Quarter 2002 Press Release should have disclosed

information about Celebrex, such as that mandated by the FDA in the "black box" warning

Celebrex now carries concerning the cardiovascular risks associated with its use. The Second

Quarter 2002 Press Release also made false and misleading statements by misrepresenting that

Bextra offered a strong efficacy, tolerabili ty and safe ty profi le compared to traditional NSAIDs

when , in fact, the Defendants knew that Bextra created certain cardiovascular and thrombotic

risks as demonstrated in CABG Trial 35 .

185 . On August 13, 2002 , Pfizer filed with the SEC its Form 10-Q for the second

quarter of 2002 (the "Second Qua rter 2002 Form I O-Q") . The Second Quarter 2002 Form 10-Q

contained the following materially false and misleading statements and/or omissions of material

fact :

Celebrex, discovered and developed by our alliance partnerPharmacia Corporation (Pharmacia), is used for relief of the pain

and inflammation of osteoarthritis (OA), adult rheumatoid arthritis(RA), acute pain and primary dysmenorrhea (menstrual pain) in

adults . In addition, Celebrex is approved to reduce the number ofadenomatous colorectal polyps in familial adenomatous polyposis,a rare genetic disease that may result in colorectal cancer . With

the approval for acute pain and primary dysmenorrhea in the U .S.,

Celebrex is the COX-2 specific inhibitor approved to treat the

broadest range of conditions . In June 2002, the FDA approve d

63

revised labeling for Celebrex . The new prescribing; information

includes additional gastrointestinal safety data and data

indicating that there was no increased risk for serious

cardiovascular adverse events observed. These cardiovascular

adverse events include heart attack, stroke and unstable angina .

(Emphasis added) . The Second Quarter 2002 Form 10-Q made false and misleading statements





associated with Celebrex . The Second Quarter 2002 Form 10-Q should have disclosed


Celebrex now carries concerning the cardiovascular risks associated with its use .

186 . On October 16, 2002, Pfizer filed with the SEC as a Form 425 its press release

announcing its second quarter 2002 results (the "October 16, 2002 Form 425") . The October 16,

2002 Form 425 contained the following materially false and misleading statements and/or

omissions of materia I fact :

Q12) HOW IS CELEBREX PERFORMING ?

A12) Celebrex is the #1 branded NSA[D and the #1 COX-2-specific inhibitor in the world . Pfizer and Pharmacia Corporation,the company that discovered and developed Celebrex, co-promotethis product in more than 60 countries . . . Celebrex providesstrong efficacy, excellent tolerability , and a proven safety profile.With the recent approval for acute pain and primary dysmenorrheain the U.S ., Celebrex is now the COX-2-specific inhibitorapproved to treat the broadest range of conditions .

Q 13) HOW IS BEXTRA PERFORMING ?

A13) Bextra was launched in the U .S . in April 2002 for the reliefof pain and inflammation of osteoarthritis (OA), adult rheumatoidarthritis (RA), and primary dysmenorrhea . . . The product has a

64

significantly lower incidence of endoscopically detectedgastroduodenal ulcers versus traditional NSAIDs (naproxen,

ibuprofen , and diclofenac ) and signi ficantly less dyspepsia versusnaproxen . In controlled comparative arthritis trials of up to 26weeks, Bextra in daily doses of 10 mg or 20 mg demonstrated anincidence of edema and hypertension similar to comparatorNSAIDs .

(Emphasis added) . The October 16, 2002 Form 425 made false and misleading statements




by falsely claiming that Celebrex provides strong efficacy, excellent tolerability, and a proven

and superior safety profile . The October 16, 2002 Form 425 should have disclosed information

about Celebrex, such as that mandated by the FDA in the "black box" warning Celebrex now

carries concerning the cardiovascular risks associated with its use . The October 16, 2002 Form

425 also made false and misleading statements by misrepresenting that Bextra offered a strong

efficacy, tolerability and safety profile compared to traditional NSAIDs when, in fact, the

Defendants knew that Bextra created certain cardiovascular and thrombotic risks as

demonstrated in CABG Trial 35 .

187 . On October 18, 2002, Pfizer issued a press release (the "October 18, 2002 Press

Release") entitled "Data Confirm Gastrointestinal Safety Profile of COX-2 Specific Inhibitor

BEXTRA® versus Non- Specific Comparator NSAIDs in Arthritis Patients ." The October 18,



Analyses of pooled study results for the COX-2 specific inhibitorBEXTRA® (valdecoxib tablets), presented at this year's annualscientific meeting of the American College of Rheumatology(ACR), underscored its improved upper gastrointestinal (GI)safety as well as its cardiovascular safety profile.

65

"Our analysis suggests that valdecoxib shows no greater

incidence of cardiovascular events than either naproxerr or

placebo," said lead author Andrew Whelton, MD, Adjunct

Professor of Medicine, Johns Hopkins University , Baltimore,Maryland . "While more data are necessary to confirm thisconclusion , our findings suggest that valdecoxib demonstrates a

cardiovascular safety profile similar to that of placebo or

naproxen . "

(Emphasis added) . The October 18, 2002 Press Release made false and misleading statements



cardiovascular and thrombotic risks associated with Bextra, demonstrated by CABG Trial 35, by

falsely claiming that analyses of pooled study results underscored Bextra's cardiovascular safety

profile and showed no greater incidence of adverse cardiovascular events .

188. On November 13, 2002, Pfizer filed with the SEC its Form 10-Q for the third

quarter of 2002 (the "Third Quarter 2002 Form 10-Q") . The Third Quarter 2002 Form 10-Q


fact :

In June 2002, the FDA approved revised labeling for Celebrex .

The new prescribing information includes additional

gastrointestinal safety data and data indicating that there was no

increased risk for serious cardiovascular adverse eventsobserved, including heart attack, stroke and unstable angina .

(Emphasis added) . The Third Quarter 2002 Form 10-Q made false and misleading statements





associated with Celebrex, including heart attacks, stroke and unstable angina. The Third Quarte r

66

2002 Form 10-Q should have disclosed information about Celebrex, such as that mandated by

the FDA in the "black box" warning Celebrex now carries concerning the cardiovascular risks


G. Analysts Embrace The Defendants ' False And Misleading Statements In

2002



investors . Analysts routinely repeated the Defendants' materially false and misleading


of which failed to disclose material facts, and utilized such statements as the basis fo r


• On January 23, 2002, A .G. Edwards & Sons, Inc . issued a report on Pfizer .

It rated Pfizer "Strong Buy." It further stated : "Pharmaceutical revenuesexceeded our expectation . . . Alliance revenues (Aricept and Celebrex) - all

performed well . . . The fact that Alliance Revenues . . . fell short ofexpectations by only $20 million seems to indicate that Celebrex continuesto perform well ; "

• On April 12, 2002, Bear Stearns issued a report on Pfizer . It stated that

"COX-2 sales rebounding and Bextra appears to be incremental to the COX-

2 family, taking share from Vioxx . Pharma sales driven by . . . Celebrex

(+22%) . . . . ; "

• On July 16, 2002, Deutsche Bank-North America issued a report on Pfizer .

It rated Pfizer a "Strong Buy ." It further stated that `FHA's Celebrex/BextraCOX-2 franchise is in a fierce, but winning, marketing battle with Merck'sVioxx. In 2Q02, label changes were made to both Celebrex and MRK'sVioxx to reflect the results of the CLASS and VIGOR studies . TheCelebrex label change is more positive in our view - i .e ., perhaps lessfavorable on GI safety, but more favorable on CV risks . Recentdevelopments in this therapeutic category, on the whole, have tipped thebalance in favor of the PHAIPFE COX-2 franchise, given the generalperception that all COX-2 products are roughly equivalent in terms ofefficacy and GI safety, the nagging concerns around CV safety that focusprimarily on Vioxx, and the delay for MRK's Arcoxia . This is reflected inthe COX-2 total Rx share that now stands at approximately 59% for thePHA/PFE franchise vs . 41% for MRK (after reaching roughly 50150 sharejust before publication of the JAMA article last August) . "

67

H. 2003 Events And False And Misleading Statements

190. During the time period from January 1, 2003 through December 31, 2003, the

Defendants made and/or caused to be issued numerous materially false and misleadin g


( including studies of COX-2 inhibitors) ; and (ii ) made false advertisements to the general public .

191 . On April 22, 2003, Pfizer filed with the SEC as an exhibit to a Form 8-K a press

release announcing its first quarter 2003 press release (the "First Quarter 2003 Press Release")

The First Quarter 2003 Press Release contained the following materially false and misleading

statements and/or omissions of material fact :


A13) Celebrex is the #1 branded non-steroidal anti-in flammatorydrug (NSAID) and the 41 COX-2-specific inhibitor in the world. . . Celebr•ex provides strong efficacy, excellent tolerability, and aproven safety profile. Celebrex is now tie COX-2- specific

inhibitor approved to treat the broadest range of conditions .

Q14) How is Bextra performing?

A14) . . . Bextra . . . has a significantly lower incidence ofendoscopically detected gastroduodenal ulcers versus traditionalNSAIDs (naproxen, ibuprofen, and diclofenac) and significantlyless dyspepsia versus naproxen . In controlled comparative arthritistrials of up to 26 weeks, Bextra in daily doses of 10 mg or 20 mgdemonstrated an incidence of edema and hypertension similar tocomparator NSAIDs .

The First Quarter 2003 Press Release made false and misleading statements regarding th e

cardiovascular safety of Celebrex in that it failed to disclose material adverse information the n

known by or recklessly disregarded by the Defendants concerning the cardiovascular an d

thrombotic risks associated with Celebrex, demonstrated by the 1999 Study, by falsely claimin g

that Celebrex provides strong efficacy, excellent tolerability, and a proven safety profile . The

68

First Quarter 2003 Press Release should have disclosed information about Celebrex, such as that


cardiovascular risks associated with its use . The First Quarter 2003 Press Release also made

false and misleading statements by misrepresenting that Bextra offered a strong efficacy,

tolerability and safety profile compared to traditional NSAIDs when, in fact. the Defendants

knew that Bextra created certain cardiovascular and thrombotic risks as demonstrated in CAB G

Trial 35 .

192. On June 18, 2003, the Vayinaker published an article entitled 'Pfizer Sees Strong

Prospects Based on Rapid Integration of Pharmacia and Expanded Product and R& D

Opportunities." In that article, Defendant Katen is quoted as describing the success alread y

achieved by Celebrex and Bextra and predicted considerable growth :

Pfizer's COX-2 portfolio, consisting of the arthritis medicinesCelebrexand Bextra, continues to post impressive gains .

Pfizer anticipates further benefits from the unified team that nowsupports the portfolio and from a steady stream of data from

important studies now under way . To conclusively (lemonstratethe COX-2s safety superiority over NSAIDs, Pfizer has

undertaken a series of major global studies that include a farbroader patient population than those believed to be at high risk for

gastrointestinal side effects .

(Emphasis added) . Defendant Katen's statements contained in the Waymaker article

made false and misleading statements regarding the cardiovascular safety of Celebrex and Bextra

in that it failed to disclose material adverse information then known by or recklessly disregarde d

by the Defendants concerning the cardiovascular and thrombotic risks associated with Celebre x

and Bextra , demonstrated by the 1999 Study and CABG Trial 35, by falsely claiming that

Celebrex and Bextra had safety superiority over traditional NSAIDs .

69

193 . On July 25, 2003, Pfizer filed with the SEC as an exhibit to its Form 8-K a pres s

release announcing its second quarter 2003 financial results (the "Second Quarter 2003 Pres s

Release" ) . The Second Quarter 2003 Press Release contained the following materially false an d

misleading statements and/or omissions of material fact :


A9) Celebrex is the #1 COX-2-specific inhibitor in the world,having the broadest range of approved indications. Celebrexprovides strong efficacy, excellent tolerability , and a provensafety profile in providing relief for the pain and inflammation ofosteoarthritis (OA) and adult rheumatoid arthritis (RA) andtreatment of acute pain and primary rlysmenorrhea in adults.

We are continuing to demonstrate Celebrex's safety advantages.In an independent analysis that included our entire Celebrexarthritis clinical-trial database, no evidence of increasedcardiovascular risk fvas found, relative to both conventional non-steroidal anti-inflammatory drugs (NSAIDs) and placebo . . .

Q 10) How is Bextra performing ?

A10) . . Bextra . . . has a significantly lower incidence ofendoscopically detected gastroduodenal ulcers versus traditionalNSAIDs (naproxen, ibuprofen, and diclofenac) and significantlyless dyspepsia versus naproxen . In controlled comparative arthritistrials of up to 26 weeks, Bextra in daily doses of 10 mg or 20 mgdemonstrated an incidence of edema and hypertension similar tocomparator NSAIDs .

(Emphasis added) . The Second Quarter 2003 Press Release made false and misleading




by falsely claiming that Celebrex has a proven safety profile and that Pfizer's entire Celebrex

arthritis clinical-trial database showed no evidence of cardiovascular risk . The Second Quarter

70

2003 Press Release should have disclosed information about Celebrex, such as that mandated by

the FDA in the "black box" warning Celebrex now carries concerning the cardiovascular risks

associated with its use . The Second Quarter 2003 Press Release also made false and misleading

statements by misrepresenting that Bextra offered a strong efficacy, excellent tolerability and a

proven safety profile compared to traditional NSA1Ds when, in fact, the Defendants knew that

Bextra created certain cardiovascular and thrombotic risks as demonstrated in CABG Trial 35 .

194 . Also on July 25, 2003, Pfizer held a conference call with securities analysts t o

discuss the Company's second quarter 2003 financial results (the "Second Quarter 2003

Conference Call") . Among other Pfizer executives, Defendants McKinnell and Katen

participated in the Second Quarter 2003 Conference Call, which contained the following

materially false and misleading statements and/or omissions of material fact :

KATEN : . . . An independent analysis that included our entireCelebrex arthritis clinical trial database, found no evidence in

increased cardiovascular risk for Celebrex, relative to bothconventional, non-steroidal anti-inflammatory drugs and

placebo. As you know there continues to be a shadow of safety

concerns about these compounds. So this should eliminate that

concern .

(Emphasis added) . The Second Quarter 2003 Conference Call made false and misleading




by falsely claiming that Pfizer's entire Celebrex arthritis clinical-trial database showed no

evidence of cardiovascular risk . The Second Quarter 2003 Conference Call should have

disclosed information about Celebrex, such as that mandated by the FDA in the "black box"

warning Celebrex now carries concerning the cardiovascular risks associated with its use .

71

195 . On October 22, 2003, Pfizer filed with the SEC as an exhibit to a Form 8-K a

press release (the "Third Quarter 2003 Press Release") . The Third Quarter 2003 Press Release


fact :


A9) . . . Celebrex is the number 1 COX-2-specific inhibitor in the

world, having the broadest range of approved indications . Itprovides strong efficacy, excellent tolerability, and a proversafety profile in providing relief for the pain and inflanzmation ofosteoartlrrltis (OA) and adult rheumatoid arthritis (AA) andtreatment of acute pain and prima y dysmenorrlrea in adults.

We are continuing to demonstrate Celebrex's safety advantages.

In an independent analysis that included our entire Celebrexarthritis clinical -trial (latabase, no evidence of increasedcardiovascular risk was forrrrd, relative to both conven tionalNSAIDs acrd placebo.

Q10) How is B extra performing ?

A10) . . . Bextra has a significantly lower incidence of

endoscopically detected gastroduodenal ulcers versus traditionalNSAIDs (naproxen, ibuprofen, and diclofenac) and significantlyless dyspepsia versus naproxen . In controlled comparative arthritis

trials of up to 26 weeks, Bextra in daily doses of 10 mg or 20 mgdemonstrated an incidence of edema and hypertension similar to

comparator NSAIDs .

The Third Quarter 2003 Press Release made false and misleading statements regarding th e

cardiovascular safety of Celebrex in that it failed to disclose material adverse information the n

known by or recklessly disregarded by the Defendants concerning the cardiovascular an d

thrombotic risks associated with Celebrex, demonstrated by the 1999 Study, by falsely claimin g

that Celebrex has a proven safety pro fi le and that Pfizer ' s entire Celebrex arthritis clinical-tria l

database showed no evidence of cardiovascular risk. The Third Quarter 2003 Press Release

72

should have disclosed information about Celebrex , such as that mandated by the FDA in the


its use. The Third Quarter 2003 Press Release also made false and misleading statements b y

misrepresenting that Bextra offered a strong efficacy, tolerability and safety profile compared to

traditional NSAIDs when, in fact, the Defendants knew that Bextra created certai n

cardiovascular and thrombotic risks as demonstrated in CABG Trial 35 .

I. Analysts Embrace The Defendants ' False And Misleading Statements In2003


statements and announcements closely in connection with reporting Company developments t o

investors. Analysts routinely repeated the Defendants' materially false and misleadin g

statements, whether appearing in press releases, financials or the advertisements themselves, al l

of which failed to disclose material facts, and utilized such statements as the basis fo r


• On January 22, 2003, JP Morgan issued a report on Pfizer. It further stated :"We are confident about PFE's earnings outlook for 2003 and beyond, basedon . . . (3) some credit for continued success with the best-in-class record ofin- licensing and co-promotion deals (i .e ., Lipitor, Celebrex, Bextra . . . ; "

On April 22, 2003, Deutsche Bank issued a repo rt on Pfizer . It rated Pfizer a"Buy." It further stated that ". . . Alliance revenues (COX-2s, Aricept,Rebif) were ahead 10% to $331 mm ;"

On May 19, 2003, William Blair & Co., LLC issued a report on Pfizer. Itrated Pfizer "Outperform ." It further stated that "Bextra ' s US launch in early2002 led to 13% revenue growth in Pfizer's COX-2 franchise last year, andwe believe incremental sales in Europe could lead to upside to ourconservative 7% sales growth estimate for the franchise in 2003 . Moreover,we believe one of Pfizer 's primary goals is to win one or more painindications for Bextra , which could lead to accelerated growth in thefranchise over the next several years, in our view ; "

• On June 18, 2003, following a Pfizer conference call with analysts, DeutscheBank issued a report on Pfizer. It rated Pfizer a "Buy." It further stated that"[flor 2003, we expect sales of $3 .75 billion for PFE's oral COX-2 agents ,

73

an increase of 6%. The franchise is winning the marketing battle with

Merck's Vioxx/Arcoxia franchise . . . . ; "

+ On July 2 5 , 2003 A .G . Edwards & Sons, Inc . issued a report on Pfizer . Itrated Pfizer a "Buy" and further stated that "[tlhe quarter is highlighted bystrong product growth across PFE 'legacy products and strong inventorycontrol, as expected, on Pharmacia products including Celebrex ;"

• On October 27, 2003, Hilliard Lyons issued a report on Pfizer. It rated Pfizera "Buy" and further stated that "[s]everal products obtained in the Pharmaciamerger contributed incremental sales to the third quarter . . . Looking at the

larger ones, sales of the arthritis drug Celebrex and Bextra added $701million and $236 million, respectively ."

J. 2004 Events And False And Misleading Statement s

197 . During the time period from January 1, 2004 though December 31, 2004, th e



( including studies of COX-2 inhibitors) ; and (ii) made false advertisements to the general public .

198. On January 22, 2004, P fizer filed with the SEC as an exhibit to its Form 8-K a

press release announcing its fourth quarter and fiscal year 2003 financial results (the "Full Yea r

2003 Press Release"). The Full Year 2003 Press Release contained the following materiall y

false and misleading statements and/or omissions of material fact:


A12) . . . Celebrex is the number 1 COX-2-specific inhibitor in the

world, having the broadest range of approved indications . It

provides strong efficacy, excellent tolerability, and a proven

safety profile in providing relief for the pain and inflammation ofosteoarth ritis (4A), rheumatoid arthritis (RA), acute pain, and

primary dysrrrenorrlreal.

We are continuing to demonstrateIn an independent analysis thatarthritis clinical-trial database,

cardiovascular risk was found,NSAIDs and placebo .

Celebrex's safety advantages .included our entire Celebrexno evidence of increased

relative to both conventional

74

Q 13) How is Bextra performing ?

A13) . . . Bextra . . . has a significantly lower incidence ofendoscopically detected gastroduodenal ulcers versus traditional

NSAIDs (naproxen, ibuprofen, and diclofenae) and significantlyless dyspepsia versus naproxen . In controlled comparative arthritis

trials of up to 26 weeks, Bextra in daily doses of 10 mg or 20 mgdemonstrated an incidence of edema and hypertension similar to

comparator NSAIDs .

(Emphasis added) . The Full Year 2003 Press Release made false and misleading statements




by falsely claiming that Celebrex has a proven safety profile and that Pfizer's entire Celebrex

arthritis clinical-trial database showed no evidence of cardiovascular risk. The Full Year 2003

Press Release should have disclosed information about Celebrex, such as that mandated by the

FDA in the "black box" warning Celebrex now carries concerning the cardiovascular risks

associated with its use . The Full Year 2003 Press Release also made false and misleading

statements by misrepresenting that Bextra offered a strong efficacy, tolerability and safety profile

compared to traditional NSAIDs when, in fact, the Defendants knew that Bextra created certain

cardiovascular and thrombotic risks as demonstrated in CABG Trial 35 .

199. On April 20, 2004, P fizer filed with the SEC as an exhibit to a Form 8-K a press

release announcing its first quarter 2004 financial results (the "First Quarter 2004 Press

Release") . The First Quarter 2004 Press Release contained the following materially false and


Q 12) How is Celebrex performing ?

A12) . . . Celebrex is the #1 COX-2-specific inhibitor in the world,having the broadest range of approved indications . It provides

75

strong efficacy, excellent tolerability, and a proven safety profilein providing relief for the pain and inflammation of osteoarthritis

(OA), rheumatoid arthritis (RA), acute pail?, and primarydysrnenorrheal.

A recent study published in the Journal of Rheumatologydemonstrated that Celebrex had a significantly longer duration ofuse than both Vioxx and nonselective NSAIDs . Patients takingCelebrex stayed on medication two months longer than thosetaking Vioxx and five months longer than nonselective NSAIDusers, which, the authors assert, can be an indication of treatmenteffectiveness and/or drug acceptability . "

Q13) How is Bextra performing?

A13) . . . Bextra . . . has a significantly lower incidence ofendoscopically detected gastroduodenal ulcers versus traditionalNSAIDs (naproxen, ibuprofen, and diclofenac) and significantlyless dyspepsia versus naproxen .

(Emphasis added) . The First Quarter 2004 Press Release made false and misleading statements




by falsely claiming that Celebrex provides strong efficiency, excellent tolerability, and a proven

safety profile . The First Quarter 2004 Press Release should have disclosed information about


concerning the cardiovascular risks associated with its use . The First Quarter 2004 Press Release

also made false and misleading statements by failing to disclose Bextra's cardiovascular and

thrombotic risks as demonstrated in CABG Trial 35 .

200. On May 7, 2004, Pfizer filed with the SEC its Form 10-Q for the first quarter of

2004 (the "First Quarter 2004 Form 10-Q") . The First Quarter 2004 Form 10-Q contained the


76

Celebrex is the No . 1 COX-2-specific inhibitor in the world,having the broadest range of approved indications . It providesstrong efficacy, excellent tolerability, and a proven safety profilein providing relief for the pain and inflammation ofosteoarthritis, rheumatoid arthritis, acute pau 1, and primaryrlysmenorrhea. Since its launch in 1999, Celebrex has accumulatedmore than 10 million patient years of use and more than 149million prescriptions worldwide, demonstrating efficacy andtolerability among a patient population whose need for long-term,effective relief of pain and inflammation is great and growing .

(Emphasis added) . The First Quarter 2004 Form 10-Q made false and misleading statement s




by falsely claiming that Celebrex provides strong efficacy, excellent tolerability, and a prove n

safety profile. The First Quarter 2004 Form 10-Q should have disclosed information about

Celebrex, such as that mandated by the FDA in the "black box" warning Celebrex now carrie s

concerning the cardiovascular risks associated with its use .

201 . On June 12, 2004, Pfizer issrPd a press release (the "June 12, 2004 Pres s

Release") entitled "Greater Tolerability of CELEBREX® in Elderly Europeans Wit h

Osteoarthritis Of the Hip or Knee May be a Measure of Overall Improved Effectiveness an d

Greater Cost Effectiveness Compared to Diclofenac Mean Treatment Costs Were Lower fo r

CELEBREX than Diclofenac ." The June 12, 2004 Press Release contained the followin g

materially false and misleading statements and/or omissions of material fact :

New research on elderly patients with osteoarthritis of the hip orknee treated with CELEBREX® (celecoxib) shows that they havea significantly lower risk of safety problems, intolerability, anddiscontinuation due to adverse events (AEs) compared withpatients treated with a moderate dose of diclofenac .

(Emphasis added) . The June 12, 2004 Press Release made false and misleading statements


77



by misrepresenting that Celebrex showed a significantly lower risk of safety problems compared

with patients treated with a moderate dose of diclofenac . The June 14, 2004 Press Release

should have disclosed information about Celebrex, such as that mandated by the FDA in the


its use .

202. On July 21, 2004, Pfizer filed as an exhibit to its Form 8-K a press releas e

announcing its second quarter 2004 financial results (the "Second Quarter 2004 Press Release" )

The Second Quarter 2004 Press Release contained the following materially false and misleading



A12) . . . In May 2004, European regulators completed a safetyreview and reaffirmed the use of COX-2-specific inhibitors such asCelebrex in a broad range of patients . The May 29, 2004, issue ofThe Lancet included an independent study by the Institute forClinical Evaluative Sciences, which provided further evidence ofthe cardiovascular safety of Celebre.t In this study, patientstaking Celebrex had the same rate of hospitalization for congestiveheart failure as people who weren't using any NSAIDs at all .Patients taking older NSAIDs, such as ibuprofen, had a 40%increase in such hospitalizations compared with a communitycontrol group not taking any of the drugs in the study .

Q 13) How is Bextra performing?

A13) . . . Bextra . . . has a significantly lower incidence ofendoscopically detected gastroduodenal ulcers versus traditionalcomparator NSAIDs (naproxen, ibuprofen, and diclofenac) andsignificantly less dyspepsia versus naproxen .

(Emphasis added) . The Second Quarter 2004 Press Release made false and misleading

statements regarding the cardiovascular safety of Celebrex in that it failed to disclose materia l

78



by deceptively reaffirming the safety of Celebrex for use in a broad range of patients . The

Second Quarter 2004 Press Release should have disclosed information about Celebrex, such as

that mandated by the FDA in the "black box" warning Celebrex now carries concerning the

cardiovascular risks associated with its use . The Second Quarter 2004 Press Release also made

false and misleading statements by failing to disclose Bextra's cardiovascular and thrombotic

risks as demonstrated in CABG Trial 35 .

203 . On August 6, 2004, Pfizer filed with the SEC its Form 10-Q for the second

quarter of 2004 (the "Second Quarter 2004 Form 10-Q"). The Second Quarter 2004 Form 10-Q


fact :

Celebrex is the No. I COX-2-specific inhibitor in the world,

having the broadest range of approved indications . It provides

strong efficacy, excellent tolerability, and a proven safety profile

in providing relief for the pain and inflammation of

osteoarthritis, rheumatoid arthritis, acute pain, and primary

dysinenorrhea. In May 2004, European regulators completed a

safety review and reaffirmed the use of COX-2-specific inhibitors

such as Celebrex in a broad range of patients.

(Emphasis added) . The Second Quarter 2004 Form 10-Q made false and misleading statements




by deceptively reaffirming the safety of Celebrex for use in a broad range of patients, and by

misrepresenting that Celebrex provides strong efficacy, excellent tolerability, and a proven safety

profile . The Second Quarter 2004 Form 10-Q should have disclosed information abou t

79

Celebrex, such as that mandated by the FDA in the "black box" warning Celebrex now carrie s


204. On August 25, 2004, the FDA announced the results of a major safety study of

patients ta king Vioxx that was conducted by David Graham , MD, an FDA epidemiologist. The

FDA study found that patients taking Vioxx at the highest recommended daily dosage had a

threefold higher risk of heart attack and sudden cardiac death than those who had been taking a

placebo .

205_ Thereafter, on September 30, 2004, Merck announced it was withdrawing Vioxx

from the market because of a proven increase in adverse cardiac events .

206 . In response, Pfizer, seeking to explo it the opportunity presented by Vioxx' s

withdrawal, falsely asserted the cardiovascular safety of both Celebrex and Bextra in a pres s

release (the "September 30, 2004 Press Release"), and denied the existence of a class-wid e

COX-2 cardiovascular effect:

In response to Merck & Co.'s announcement today of theworldwide withdrawal of its COX-2 medicine Vioxx, Pfizer Inc .issued the following statement :

"P fizer is confident in the long term cardiovascular safety ofCelebrex," said Dr. Joe Feczko, Pfizer's president of worldwidedevelopment .

In a recent FDA-sponsored study of 1 .4 million patients, those whoreceived Celebrex demonstrated no increased risk of cardiacevents .

'Patients taking COX-2 inhibitors may be confused and shouldspeak with their doctors," Dr. Feczko said . "Because of itsoutstanding long-term safety profile and broad indication baseincluding osteoarthritis, rheumatoid arthritis and acute pain,Celebrex is an appropriate treatment alternative ." . . .

Bextra's cardiovascular safety profile is also well established in

long-term studies .

80

The September 30, 2004 Press Release made false and misleading statements regarding the

cardiovascular safety of Celebrex and Bextra in that it failed to disclose material adverse


cardiovascular and thrombotic risks associated with Celebrex and Bextra, demonstrated by th e

1999 Study and CABG Trial 35, by misrepresenting that Celebrex and Bextra posed no

cardiovascular problems to consumers in comparison with the safety issues linked to Merck's

Vioxx. The September 30, 2004 Press Release should have disclosed information about



207. On October 1, 2004, Pfizer issued a press release (the "October 1, 2004 Press

Release") in Europe once again falsely asserting the safety of its COX-2 drugs . The October 1,


omissions of material fact:

Data demonstrate[sf that Celebrex does not increase the risk of

heart attack or stroke in patients with arthritis and p a il!, even at

high er-than-recommended closes[.]

Pfizer Inc . said today that three large long-term Celebrex . . .

studies involving more than 6,000 patients have not shown anysignificant safety issues and are expected to continue to

completion .

"Each Cox-2 inhibitor has a distinct chemical structure and wewould not expect them to have the same side effect profile," saidDr. Joe Feczko, Pfizer's president of worldwide development . "Thedata we've accumulated over time demonstrate that Celebrex doesnot increase the risk of serious cardiovascular events in patientswith arthritis and pain, even at higher-than-recommended doses ."



81



by falsely claiming that Celebrex does not increase the risk of heart attack or stroke . The

October 1, 2004 Press Release should have disclosed information about Celebrex, such as that



208 . The St. Lois Post-Dispatch also published an article on October 1, 2004 entitled

"Pfizer's Celebrex may get boost from Merck's decision to pull Vioxx ." In that article,

Defendant Cawkwell attempted to distinguish the safety concerns for Vioxx and Celebrex :

"There's a spectrum of cardiovascular safety, and Vioxx falls atone end and Celebrex at the other," said Gail Cawkwell, aphysician on New York-based Pfizer's Celebrex medical team .

"The (drugs) are different in molecular structure, in some of theways that they act and interact in the body," she said .

Defendant Cawkwell made false and misleading statements in the St. Lois Post-Dispatch a rt icle

regarding the cardiovascular safety of Celebrex in that she failed to disclose material adverse



by misrepresenting that Celebrex posed no cardiovascular problems to consumers in comparison

with the safety issues linked to Merck's Vioxx . Defendant Cawkwell should have disclosed



209. Also on October 1, 2004, Pfizer issued a press release, once again falsely

asserting the cardiovascular safety of its COX-2 inhibitors (tile "October 1, 2004 Press

Release"). The October 1, 2004 Press Release contained the following materially false and


82

Pfizer Inc . said today that three large long-term Celebrex(celecoxib capsules) studies involving more than 6,000 patientshave not shown any significant safety issues and are expected tocontinue to completion .

The evidence distinguishing the cardiovascular safety of

Celebrex has accumulated over years in multiple completed

studies, none of which has shown any increased cardiovascular

risk for Celebr'ex, the world 's most prescribed arthritis and painrelief brand.

"Each Cox -2 inhibitor has a distinct chemical structure and wewould not expect them to have the same side effect profile," saidDr. Joe Feczko, Pfizer's president of worldwide development . "Thedata we've accumulated over time demonstrate that Celebrex doesnot increase the risk of serious cardiovascular events in patientswith arthritis and pain, even at higher-than-recommended doses . "





by misrepresenting that multiple studies show that Celebrex poses no increased cardiovascular

risk. The October 1, 2004 Asia Press Release should have disclosed information about Celebrex,

such as that mandated by the FDA in the "black box" warning Celebrex now carries concerning

the cardiovascular risks associated with its use .

210. On October 12, 2004, Pfizer again responded to the withdrawal of Vioxx by

posting the following statements on the website <www .celebrex .com> (the "October 12, 2004

Statement") . The October 12, 2004 Statement contained the following materially false and


For years, CELEBREX has been helping people with pain andarthritis feel better . Now we'd like to put your mind at ease, too .As you've probably heard, VIOXX©, a COX-2 drug for arthritisand pain, has been withdrawn from the market because it increase d

83

the risk of heart attacks and strokes . But, the information belowshould rmke you feel good about CELEBREX, which is also aCOX-2 drug.

Does CELEBREX increase the risk of stroke, heart attack, or deathby effects on the heart or blood vessels ?

In numerous studies, CELEBREX did not increase the risk ofheart attack, stroke, or death caused by heart attack or strokecompared to patients taking traditional arthritis medications or asugar pill.

What does recent patient data show?

In one study, people preferred once daily CELEBREX to 4 times aday acetaminophen (the main ingredient in Tylenol(V) .4 And in asix month study of nearly 800,000 patients , more people stayedwith CELEBREX than naproxen (used in Aleve®) or ibuprofen(Motrin®) .

(Emphasis added) . The October 12, 2004 Statement made false and misleading statements




by misrepresenting that Celebrex did not increase the risk of heart attack, stroke, or death caused

by heart attack or stroke compared to patients taking traditional NSAIDs or a placebo . The

October 12, 2004 Statement should have disclosed information about Celebrex, such as that



211 . On October 15, 2004, Pfizer filed as an exhibit to a Form 8-K a press release (the

"October 15, 2004 Press Release") . The October 15, 2004 Press Release announced plans to

conduct further Bextra cardiovascular safety studies, and contained the following materially false

and misleading statements and/or omissions of material fact :

84

PFIZER PROVIDES INFORMATION TO HEALTHCAREPROFESSIONALS ABOUT ITS COX-2 MEDICINE BEXTRA®(VALDECOXIB)

In the letter to healthcare professionals . Pfizer . . . reviewed

information about the cardiovascular profile of Bextra . The

information is based on analyses of a comprehensive clinical trialdatabase of nearly 8,000 patients treated with Bextra for durations

ranging from six to 52 weeks . Available clinical information forBextra suggests there is no increased risk of cardiovascular

throntboeinbolic events in people treated for osteoarthritis (OA)and rheumnatoid arthritis (RA) .

In addition, Be.Ctra has been studied in several surgical settings .

In studies in general surgery, Bextra in combination fvitll theinvestigational drug parecoxib (an IV formulation) s11owwed no

increased risk of cardiovascular thromboemholic events .

(Emphasis added ) . The October 15, 2004 Press Release made false and misleading statements



cardiovascular and thrombotic risks associated with Bextra , demonstrated by CABG Trial 35, b y

falsely claiming that available clinical information showed no increased risk of cardiovascula r

thromboembolic events in patients taking Bextra .

212. On October 18, 2004, Pfizer issued a press release entitled "Pfizer to Sponso r

Major New Celebrex Clinical Trial," (tile "October 18, 2004 Press Release" ) . The October 18 ,

2004 Press Release contained the following materially false and misleading statements and/o r


Pfizer Inc announced today it is sponsoring a major clinical studyto further assess its COX -2 medication CELEBREX® (celecoxib)

in osteoarthritis (OA) patients at high risk for cardiovascular

disease .

"Our strong confidence in the CV safety of Celebrex is based onthe substantial body of experience that has accumulated over

several years in multiple completed studies and ongoing trials, "

85

said Dr. Joseph Feczko, MD, president of worldwide developmentat Pfizer. "In fact, small mechanistic studies suggest thatCelebrex s anti- inflammatory properties as well as additionalunique Celebrex specific characteristics may improve vascularfunction in patients with established coronary artery disease . Thatis why we feel it is important at this time to announce our plans toconduct the first large-scale clinical study involving the use of aCOX-2 specific inhibitor to look at inflammation and CV events inosteoarthritis patients at high risk for cardiovascular disease ."

Celebrex has a strong long-term safety profile and broad indicationbase including osteoarthritis, rheumatoid arthritis and acute pain,backed up by observational data and ongoing trials .

Pfizer remains confident in the long-term cardiovascular safety

of Celebrex. The CV safety pro fi le of Celebrex is supported byextensive clinical and widespread post-marketing experience .More than 27 million patients in the US have been prescribedCelebrex, which was approved by the U.S . Food and DrugAdministration in 1998 -- even more patients have used Celebrexin over 60 countries worldwide . Patients treated in clinical studiesof up to 4 years show no increased CV safety concerns .





by deceptively reaffirming the long term safety of Celebrex . The October 18, 2004 Press

Release should have disclosed information about Celebrex, such as that mandated by the FDA i n

the "black box" warning Celebrex now carries concerning the cardiovascular risks associate d

with i ts use .

213 . On October 20, 2004, P fizer held a conference call with securities analysts to

discuss the Company's third quarter 2004 financial results (the "Third Quarter 2004 Conferenc e

Call"). Among other P fizer executives, Defendants McKinnell, Katen and Feczko participated i n

86

the call . The Third Quarter 2004 Conference Call contained the following materially false and


KATEN : . . . Finally, our COX-2-specific inhibitor medicines areresponding to new challenges as well . Both Celebrex and Bextracontinue to perform well by exceeding year-to-date projections,and we expect this trend to continue as more doctors and patientsconsider them as effective , appropriate treatment alternatives . No

other prescription medicine is its widely used for arthritis andpain relief as is Celebrex. Thanks to its outstanding efficacjf,

long-terry: safety profile and broad range of use .

In a recent FDA-sponsored analysis of 1 .4 million patients andin additional clinical studies where patients have been treated fo r

up to four years, patients using Celebrex showed no increasedrisk of cardiac events. This past Monday, we announced responsefrom a major clinical study to further evaluate the potentialcardiovascular benefit of Celebrex in osteoarthritis patients at highrisk for cardiovascular disease . This new global study will begin inearly '05 and will further explore evidence that certain propertiesof Celebrex may improve vascular function in patients withestablished coronary artery disease .

And now a word about our other COX-2, Bextra . . . Available

clinical evidence for Bextra, based on nearly 8,000 patients,suggest no increased risk of cardiovascular throinbotic events in

patients with OA and RA . . . .

TIMOTHY ANDERSON - PRUDENTIAL - ANALYST : Then

on the COX category again , you guys seem pretty confident in thecardiovascular profile of Bextra, so I'm wondering why there is nota Bextra arm in this Celebrex trial you've announced, being as wereally don't have any Iong term data with that product . Then onpara-COX . I'm wondering when and where we can expect to seethe full results of that second cabbage study .

FECZKO: Yeah . Couple things there . We are -- we will be

working with the FDA on talking about what kind of data theywant on Bextra . The Celebrew cardiovascular study had been in

the makingsfor quite a long time now, and was based on lookingat -- based on a lot of the epidemiological studies we had that

actually showed a trend toward some kind of beneficial effects

87

seen on vascrrlature. So as part of what we're doing here -- this

isn't strictly a safety study, we're looking at improvement ininflammatory markers for cardiovascular disease and another

aspect that improve its function

(Emphasis added) . The Third Quarter 2004 Conference Call made false and misleading




by misrepresenting that Celebrex has an outstanding long term safety profile . The Third Quarter

2004 Conference Call should have disclosed information about Celebrex, such as that mandated


associated with its use . The Third Quarter 2004 Conference Call also made false and misleading

statements regarding the cardiovascular safety of Bextra in that it failed to disclose material

adverse information then known by or recklessly disregarded by the Defendant concerning the

cardiovascular and thrombotic risks associated with Bextra, demonstrated by CABG Trial 35, by

falsely claiming that available clinical evidence for Bextra showed no increased risk of

cardiovascular thrombotic events in patients with OA and RA.

214 . Also on October 20, 2004, Pfizer filed as an exhibit to a Form 8-K a press release

(the "October 20, 2004 Press Release") announcing its third quarter 2004 financial results . The

October 20, 2004 Press Release contained the following materially false and misleading



A14) . . . Celebrex . . . provides proven lasting strength for thepain and inflammation of osteoarthritis (OA), rheumatoid arthritis(RA), acute pain, and primary dysmenorrhea , with a low risk ofgastrointestinal bleeding compared to non -steroidal anti-infla:nnzatoiy drugs (NSAIDs) and established cardiovascularsafety.

88

Following the global withdrawal of Merck's Vioxx from the

market on September 30, Pfizer has been communicating withbusiness partners, including wholesalers, pharmacy chains,pharmacy benefit managers, and other managed-care organizations

to assure them of the availability of Celebrex to meet potential

patient need. Pfizer has reaffirmed its confidence in the well-documented cardiovascular safety of Celebrex and has releasedinformation citing that there is no evidence of a cardiovascularsafety signal for Celebrex in long-term clinical trials of more than

6,000 patients . . . .

Q15) How is Bextra performing ?

A15) . . . The clinical efficacy of Bextra has been we ll establishedby studies in more than 11,000 patients and its use by more than 10million patients worldwide . It is indicated for osteoarthritis (OA),rheumatoid arthritis (RA), and primary dysmenorrheal . Its efficacyis also shown in OA and RA flares, which makes Bextra a valuabletherapeutic option for tough- to-treat arthritis patients .

A recent analysis published in the American Journal ofTherapeutics supports the cardiovascular safety of Bextra based onan analysis of a comprehensive clinical-trial database of nearly8,000 patients treated with Bextra for durations ranging from sixto 52 weeks. Available clinical information for Bextra suggeststhere is no increased risk of cardiovascular throtrrboembolicevents in people treated for OA and RA . Pfizer will be conductingfurther studies to confirm the long-term cardiovascular safetyprofile of Bextra in patients who require chronic treatment forarthritis with a COX-2-specific inhibitor .

In studies in general surgery, Bextra in combination with theinvestigational drug parecoxib (an intraven ous formulation)showed no increased risk of cardiovascular thronrboembolicevents.





89

by misrepresenting that Celebrex has an established safety profile . The October 20, 2004 Press

Release should have disclosed information about Celebrex, such as that mandated by the FDA in

the "black box" warning Celebrex now carries concerning the cardiovascular risks associated

with its use. The October 20, 2004 Press Release also made false and misleading statements

regarding the cardiovascular safety of l3extra in that it failed to disclose material adverse


cardiovascular and thrombotic risks associated with Bextra, demonstrated by CABG Trial 35, in

that it misrepresented that studies of Bextra showed no increased risk of cardiovascular

thromboembolic events .

215 . On November 4, 2004, Pfizer issued a press release (the 'November 4, 2004 Pres s

Release") falsely asserting the cardiovascular safety of Celebrex following a report in Canada's

National Post . The November 4, 2004 Press Release entitled "Pfizer Affirms Celebrex Safety"


fact :

Pfizer Inc today issued the following statement in response to areport in Canada's National Post newspaper concerning thecardiovascular safety of Celebrex :

The news report, based on voluntary spontaneous event reportingto Canadian Health authorities, is misleading . The story is notsupported by any clinical or epidemiological studies and has thepotential to cause undue confusion among patients and physicians .

The safety profile for Celebrex is well-established and issupported by extensive clinical studies in Canada and around theworld.

Voluntary spontaneous event reporting to health authorities is notdesigned and cannot be used to determine cause and effect . It isessential to remember that the information provided is uncontrolledand may be second-hand or incomplete .

Health Canada has acknowledged these limitations, noting "therehasn't been a causal link established" . The agency has also note d

90

that these data contain no information about patients' underlyingmedical conditions .

Millions of patients have been prescribed Celebrex since its firstapproval in 1998 and large-scale clinical studies of up to fouryears showed n o increased cardiovascular safety risk.

(Emphasis added) . The November 4, 2004 Press Release made false and misleading statements




by misrepresenting that Celebrex has a well established safety profi le showing no increased

cardiovascular risks . The November 4, 2004 Press Release should have disclosed information


carries concerning the cardiovascular risks associated with its use .

216. On November 5, 2004, P fizer filed with the SEC its Form I0-Q for the thir d

quarter of 2004 (tile "Third Quarter 2004 Form 10-Q") . The Third Quarter 2004 Form I0- Q


fact :

Celebrex is the world's most-prescribed arthritis and pain-reliefbrand. It provides proven lasting relief for the pain andinflammation of osteoarthritis (OA), rheumatoid arthritis (RA),acute pain, and primary dysmenorrhea, with a low risk ofgastrointestinal bleeding compared to non-steroidal anti-inflammatory drugs (NSAIDs) and an established cardiovascularsafety profile . . . . We have reaffirmed our confidence in the well-documented cardiovascular safety of Celebrex, and we havereleased information citing that there is no evidence of acardiovascular safety signal for Celebrex in ongoing, long-termclinical trials involving more than 6,000 patients.

Bextra is an important therapeutic option for tough-to-treat arthritispain, offering patients effective once-daily dosing and powerful

relief. Available clinical information for Bextra, based on a recen t

91

pooled analysis of nearly 8,000 patients treated with Bextra for

periods ranging from six weeks to one year , suggests no increasedrisk of cardiovascular thromboembolic events in patients withOA and RA. Pfizer will be conducting further studies to confirm

the long-term cardiovascular safety profile of Bextra in patientswho require chronic treatment for arthritis with a COX-2-specific

inhibitor.

In studies in general surgery, Bextra (valdeco. ib) in combinationwith the investigational drug parecoxib (an intravenousformulation of valdecoxib) showed no increased risk ofcardiovascular thro,nboembolic events.

(Emphasis added) . The Third Quarter 2004 Form I O-Q made false and misleading statements




by misrepresenting that Celebrex has a well documented long term safety profile . The Third

Quarter 2004 Form 10-Q should have disclosed information about Celebrex, such as that


cardiovascular risks associated with its use . The Third Quarter 2004 Form 10-Q also made false

and misleading statements regarding the cardiovascular safety of Bextra in that it failed to

disclose material adverse information then known by or recklessly disregarded by the Defendants

concerning the cardiovascular and thrombotic risks associated with Bextra, demonstrated by

CABG Trial 35, in that it falsely claimed that the studies of Bextra showed no increased risk of

cardiovascular thromboembolic events .

217 . On the November 11, 2004 episode of the Nightly Business Report, a segment

was aired where Defendant McKinnell was interviewed by Stephanie Woods ("Woods") .

During that interview, Defendant McKinnell made the following materially false and misleading


92

WOODS : Two of P fizer 's biggest drugs, Bextra (ph) and Celebrexhave oome under a cloud of uncertainty about their safety andeffectiveness . How can you guarantee people that these drugs aresafe and effective ?

McKINNELL : Well, they haven't really come under a cloud .Different drugs are different chemical entities . Vioxx has beenshown to raise blood pressure and raise cardiovascular risk . We

don't have that kind of evidence for Celebrex and Bextra . In factthe current information we have on Celebrex shows that it mightbe protective of the heart and we've just launched a two-yearstudy to show that hopefully that this drug is cardio- protective .

WOODS: There is some concern about some studies that weredone in Canada showing a correlation of cardiac risk .

McKINNELL : The FDA reviews all the data. They review all theevents that are spontaneously repo rted and their judgment is thesedrugs are safe and effective when used as recommended .

Defendant McKinnell made false and misleading statements during the Nightly Business Report

episode regarding the cardiovascular safety of Celebrex and Bextra in that he failed to disclose

material adverse information then known by or recklessly disregarded by the Defendant s

concerning the cardiovascular and thrombotic risks associated with Celebrexand Bextra,

demonstrated by the 1999 Study and CABG Trial 35, by misrepresenting that Celebrex and

Bextra were safe and that Celebrex might even offer cardio-protective benefits . Defendant

McKinnell should have disclosed information about Celebrex, such as that mandated by the FDA

in the 'black box" warning Celebrex now carries concerning the cardiovascular risks associated

with its use .

218. On November 30, 2004, Pfizer held a conference call with securities analysts (the

"November 30, 2004 Conference Call") . Among other Pfizer executives, Defendants

McKinnell, Katen and Feczko participated in the call . The November 30, 2004 Conference Call


fact :

93

KATEN : . . . Celebrex is a unique molecule. As a matter of fact,there has been a lot of noise and literature about trying to getunifying hypotheses about why COX 2s may have similar sideeffect profiles . I wish to point out that both Celebrex and Bextracome from unique chemical classes that are different from thechemical class in Vioxx and Arcoxia came from. These chemicalclass differences are noticeable at the molecular level, where theyinteract differently with cell membranes, their ability to introducefree radical reduction and oxidative intermediates, which may havean effect on abnormal vascular endothelium . They also havedifferences that manifest clinically, especially in the propensity tocause hypertension and cell retention .

Bextra, we note in long clinical trials, is very similar to traditionalNSAIDs in its ability to promote cell-retention or causehypertension, and Celebrex actually has less of a propensity forhypertensiveness and cell-retention than traditional NSAIDs. Thisis not the same with Vioxx .

This unique molecule in Celebrex, with the proven strength andsafety profile, makes it the world's most prescribed arthritis andpain-relief treatment. Pfizer is confident in the safety and reliabilityof Celebrex as an appropriate treatment . Our confidence in thecardiovascular safety of Celebrex is based on the substantial bodyof experience it has accumulated over several years in multiplecompleted studies and in ongoing trials, including trials that havelasted for up to four years .

In addition, we are now sponsoring a major clinical study to furtherassess Celebrex in osteoarthritis patients at high risk for

cardiovascular disease. This study is part of a larger cardiovascularexploration program with Celebrex that started more than 18

months ago. This new clinical trial, which will be conducted atmajor universities and hospitals around the world, is expected to

start early in 2005 . As I mentioned, early mechanistic studies

suggest that Celebrex's anti-inflammatory properties are uniqueand may in fact improve vascular function in patients with heartdisease, so we are conducting a large-scale clinical study toexamine potential cardiovascular benefits in osteoarthritis patientswith cardiovascular disease .

Bextra, our second COX -2 inhibitor, is an important therapeutic

option for tough-to-treat arthritis patients in the appropriate patient .

Bextra offers patients powerful relief and once-daily dosing.

Available clinical information from a recently pooled analysis ofOA and RA clinical trials involving nearly 8000 patients with

dosing intervals ranging from 6 to 52 weeks in duration suggest no

94

increased risk of cardiovascular thrombotic events in patients withosteoarthritis and rheumatoid arthritis .

MARA GOLDSTEIN, CIBC - ANALYST : Mara Goldstein with

CIBC. A question on Bextra. Can you comment whether or notyou have had a chance to look at the meta analysis that waspresented at AHA and when indeed you might be able to commenton that analysis ?

MCKINNELL : . . . On the meta analysis, I'll ask Joe to talk aboutthat in the future . But I guess my comment would be get a griphere. Because as Karen showed there is a reason the COX-2 agentswere developed . Its a sad fact that more Americans die each yearfrom non-steroidal induced GI bleeds than die from AIDS . They

number about 16,500 versus about 15,000 . So there are seriousside effects to the traditional non-steroidals .

We tend to think because these are older, well-known agents,we've all taken them, that they're safe . Wrong. We know about theGI risk. What we are exploring is the cardiovascular profile witheach of these agents, and you can bet they're not going to be thesame.

k * k

We have all kinds of data that shows not only is there no signalof a cardiovascular risk with Celebrex, and you have heard us

say we have over 6000 patients going out beyo nd 3 years andmany of those now beyond 4 years with no signal of acardiovascular risk, but from some of the other meta analysiswe've seen , it looks like Celebret may even have a lower riskthan any of the other non steroidal agents . We've now launched a

study to try to demonstrate that. So out of all this will come a much

greater understanding of how all the various non-steroidals, new

and old , COX-2s and the old version , stack up on a controlled

clinical study on both GI safety and cardiovascular risk . And we'reextremely confident that when this all plays out, which will take acouple of years, Celebrex is going to be the clear winneremergingfrom all of this .

FECKZO : . . . We have published -- and it was published in thestudy I referred to, which was the analysis of all RA and OApatients with Bextra was posted about a year and a bit ago - Ithink it was the summer of '03 - that showed no increased

95

cardiovascular risk. And again, those studies were not long, but

they were all-inclusive of everything that's been done on Be .vtra

in OA/RA.

(Emphasis added) . The November 30, 2004 Conference Call made false and misleading

statements regarding the cardiovascular safety of Celebrex and Bextra in that it failed to disclose

material adverse information then known by or recklessly disregarded by the Defendants



Bextra posed no increased cardiovascular risk . The November 30, 2004 Conference Call should

have disclosed information about Celebrex, such as that mandated by the FDA in the "black box"

warning Celebrex now carries concerning the cardiovascular risks associated with its use .

219. On December 1, 2004, Defendant McKinnell was quoted in an interview (the

"December 1, 2004 McKinnell Interview"') with Neil Cavuto published in Business Roundtable

Newsroom. The December 1, 2004 McKinnell Interview contained the following materially

false and misleading statements and/or omissions of material fact :

MCKINNELL: Well, let's go back to the beginning here and why

these drugs were invented in the first place . It's tragically true that

more Americans die each year from the use of the old non-steroidal anti- inflammatories, the ibuprofens, naproxens, theprophenact (ph), than die of AIDS every year . The number is about

16,500 for non-steroidal anti-inflammatory induced G.I . bleeds to

about 15,000 for -- for those dying -- dying from AIDS or AIDS

complications. These drugs were developed for a very important

reason. It is true that Vioxx showed in extensive clinical studies to

increase cardiovascular risk . But with Celebrex, for example, we

have over 6,000 patients in controlled clinical studies beyondthree years, and the most encouraging thing fve've seen in some

analyses of data, which aren't as good as controlled clinicalstudies. We've seen a protective effect, possibly, for Celebrex.

And we are now launching a program to determine if that is the

case or not .

(Emphasis added) . The December 1, 2004 McKinnell Interview made false and misleading

statements regarding the cardiovascular safety of Celebrex in that it failed to disclose materia l

96

adverse information then known by or recklessly disregarded by the Defendants concerning th e


by misrepresenting that Celebrex was safe and might even offer card io-protective benefits . The

December 1, 2004 McKinnell Interview should have disclosed information about Celebrex, suc h

as that mandated by the FDA in the "black box" warning Celebrex now carries concerning th e

cardiovascular risks associated with its use.

220. On December 17, 2004, Pfizer executives further downplayed the cardiovascula r

risks associated with Celebrex . In an Associated Press published interview entitled "P fizer Finds

Heart Attack Risk with Celebrex, Plans to Continue to Sell Drug," Defendant Feczko stated that

"it has not [been] shown in totality that it [Celebrex] increases the risk of heart attacks . "

Defendant Feczko made false and misleading statements regarding the cardiovascular safety of

Celebrex in that he failed to disclose material adverse information then known by or recklessly

disregarded by the Defendants concerning the cardiovascular and thrombotic risks associate d

with Celebrex, demonstrated by the 1999 Study, by falsely claiming that Celebrex does not

increase the risk of heart attacks. Defendant Feczko should have disclosed information abou t

Celebrex, such as that mandated by the FDA in the "black box" warning Celebrex now carrier s


221 . Later, in a Nightly Business Report interview, Defendant McKinnell engaged i n

the following exchange with correspondent Jeff Yastine ("Yastine") :

YASTINE: I" m told the company has no plans to pull Celebrex offthe market . Why not ?

McK[NNELL : A decision to withdraw a drug is made in thecontext of all the information known about this drug . These twohigh dose long-term studies, they contradict each other to beginwith and the one showing cardiovascular risk also contradicts thegreat body of evidence we have around the long term use ofCelebrexwhen used as recommended .

97

YASTINE: Would anything happen or what would have to happento perhaps change your mind, to change Pfizer's mind about

Celebrex? Why not pull it off the market just as a preliminarycautionary measure?

McKINNELL: Well, we have to remember why this class ofmedicines was developed in the first place . It's tragically true thatmore Americans die of GI bleeds induced by traditional nonsteroidals than die of AIDS in this country, 16,500 versus about15,000 . There's a very important medical need for safe, effectivetreatment of the pain and inflammation of arthritis .

YASTINE: Is there any concern on your part just from a financialperspective? I was reading in the "New York Times" they saidabout I I percent of all new prescriptions that are written byprimary care physicians are for Celebrex . Some people, it might bea cynical comment, some people might say this is the reason whyyou're not pulling the drug off the market .

McK[NNELL : This is a very important medicine, meeting unmetmedical needs of millions of patients in the United States andCanada and in Europe . It's a needed medicine. Physicians need tobe fully informed . Patients need to discuss the risks and benefits ofthis class of medicines with their physicians and many times theywill choose Celebrex as the best choice .

YASTINE : Let's move on to Bextra which is another Cox 2inhibitor . The "New England Journal of Medicine " had an article,physicians there are recommending that physicians stopprescribing your Bextra drug and I believe the FDA last weekrequired a warning label for folks with heart ailments to be carefulusing Bextra. Is that another concern for Pfizer, for you?

McKINNELL : Well, that's not really correct. What we included

with the FDA and the Bextra label was a unique group of patients,those who have just come off coronary artery bypass grafts whohave been on heart lung machines, who have been treated with aninjectable form Bextra not yet approved in the United States andvery high doses of oral Bextra and of course Bextra's not approved

in the United States for this indication .

YASTINE: Well, give us some perspective then on this . I meanthere might be a concern about folks jumping to the conclusionthat between Vioxx, Bextra and Celebrex that that 's it for Cox 2inhibitors . Give us some perspective as to why you think thatobviously these drugs still have a great deal of value for patientsand for P fizer.

98

McKINNELL: Well, these are very different chemical agents .Vioxx and Celebrex and Bextra are from different chemicalclasses . They affect the body in different ways . We have very largebodies of evidence around the safety and effectiveness of theseagents when they're used as recommended . The key of course is tohave physicians and patients fully informed of the benefits and therisks of treatment with any of these agents . and then we leave to itthe physician and patient to choose what's in the best interest ofthe patient .

Defendant McKinnell made false and misleading statements in the Nightly Business Report

interview regarding the cardiovascular safety of Celebrex and Bextra in that he failed to disclose

material adverse information then known by or recklessly disregarded by the Defendants



Bextra posed no increased cardiovascular risks. Defendant McKinnell should have disclosed



K. Analysts Embrace The Defendants ' False And Misleading Statements In2004

222. Throughout 2004, analysts followed the Defendants' public statements and

announcements closely in connection with reporting Company developments to investors .

Analysts routinely parroted the Defendants' materially false and misleading statements .

However, all ofthe Defendants' statements failed to disclose material facts of the serious

cardiovascular risks Celebrex and Bextra posed . Nonetheless, the analysts relied on the

Defendants' statements as the basis for recommending that investors purchase the Company's

stock, and in this way, made a market hopelessly distorted by false and misleading information

For example :

On September 30, 2004, William Blair & Co ., LLC issued a report on Pfizer,stating in part, "Merck (MRK $45 .07) announced a voluntary, worldwidewithdrawal of Vioxx (rofecoxib), its COX-2 inhibitor for arthritis and acute pain .

99

The decision, effective immediately, is the result of new data from a three-yearprospective, randomized and placebo- controlled clinical trial, APPROVe(Adenomatous Polyp Prevention on Vioxx), originally intended to add labeling toreduce intestinal polyps to compete with Pfizer's Celebrex labeling . We view thisas positive for Pfizer's COX-2 inhibitors, Celebrex and Bextra, which generatedgreater than $4 billion in last 12 months revenue ;"

On October 6, 2004, Friedman Billings Ramsey issued a report on Pfizer entitled

"Can't Get Enough - Upgrading to Outperform from Market Perform, Raising

Price Target to $38," which stated in part: 'Celebrex safety holding up . Given

that Celebrex is in the same class as Vioxx, there have been concerns thatCelebrex might also harbor some unrecognized safety issues . However, on

learning of the cardiovascular risks associated with Vioxx, the company contactedindependent safety committees overseeing three long-term trials, two to examinecolon cancer (five year studies) and one to examine Alzheimer's disease (which

has been running three years) . According to the safety connnittees, there were noindications of any increased cardiovascular risk atnong study patients in any of

the trials. Similar results were seen in retrospective studies, including an FDA

funded study examining 1 .4 million patient records from Kaiser Permanente . In

this study, patients on Vioxx were found to be more likely to have heart problems,

and patients who took Celebrex were actually 14% less likely to have heartproblems than those who had taken NSAID painkillers . The authors concluded

that the differences between risk levels of Vioxx and Celebrex were statistically

significant ."

(Emphasis added) .

223. Clearly reflecting the success of Pfizer's strategy of concealing the cardiovascula r

risks of Celebrex and Bextra, and clearly reflecting how that disinformation campaign distorte d

the market, on October 21, 2004, A .G. Edwards & Sons, Inc . issued a report on Pfizer . It rated

Pfizer a "Hold ." It further stated :

PFE recently reviewed the cardiovascular profile of Bextra withhealthcare professionals, reiterating that there is no increasedrisk of cardiovascular throrrrboernbolic events in people treatedfor osteoarthritis (OA) and rheumatoid arthritis (RA) . This wasbased on a clinical trial database of 8,000 patients treated withBextra for a range of 6 to 52 weeks . PFE had also announcedresults from studies with Bextra in surgical settings (for which theproduct is not approved) . (1) In general surgery Bextra incombination with parecoxib (IV formulation) showed no increasein cardiovascular thromboembolic events .

(Emphasis added) .

100

L. 2005 Events And False And Misleading Statements

224. Even after the revelations in late 2004, regarding Celebrex and Bextra and

Merck's withdrawal of Vioxx, in 2005 Pfizer kept up its disinformation campaign falsely trying

to distinguish its COX-2's from Vioxx and otherwise concealing or deceptively minimizing the

truth that Celebrex and I3extra posed serious cardiovascular risks . From January 1, 2005 through

October 19, 2005, the Defendants made and/or caused to be issued numerous materially false and

misleading statements and/or omissions of material facts related to the safety of Celebrex and

Bextra (including studies of COX-2 inhibitors) .

225 . On January 4, 2005, USA Today published an article entitled "Pfizer leader steps

up to plate for Celebrex," in which Defendant McKinnell was interviewed by Ron Insana .

During that interview, Defendant McKinnell resolutely refused to tell the truth, which Pfizer had

long known, about Celebrex's cardiovascular risk - not just by nondisclosure and evasions, but

by outright falsehoods :

[Ron] Insana: Is there a serious risk to people who use Celebrex ona regular basis?

[Hank] McKinnell : We still believe that Celebrex, when used asrecommended, which does not mean 800 milligrams a day

continuously for three years, is safe and effective . We've had

discussions with the FDA. They haven't taken a formal position,

but what they've said publicly is that physicians should beconsidering alternatives for treatment of arthritis and pain and thatif Celebrex is the alternative they select, then it should be at the

minimally effective dose, and that's good medicine . We agree .

Insana: Given the described cardiac risks for Celebrex, why should

it still be on the market and Vioxx be ofd'?

McKinnell : There are two major differences . One is they aredifferent chemical families . They both target the COX-2 enzyme,but they're different molecules . They affect the body differently.Secondly, all of our own clinical data, which include 40,000patients, show no evidence of cardiovascular risk. In these largepatient-test studies, they show consistently that Celebrex actuall y

101

has less cardiovascular risk than people receiving no treatment atall .

Insana: A recent colon polyp study, using Celebrex as a cancerpreventive, turned up a greater incidence of heart risk amongCelebrex users than had been previously discovered . How did thathappen?

McKinnell : That's the $3.6 billion question. We can't really

understand it. It was a large, well controlled study, 2,200 patients .

There were a very small number of events, 41 in total . There were

six cardiac events in the no-treatment group, 15 in the 400-milligram (dosage) group and 20 in the 800-milligram group.

That's an increase in risk from 1% to 2%. So absolutely it's a small

number, but it is a significant finding . We don't want to

underestimate it . It is exactly contradicted, however, by a second

study, also large, also well-controlled, that we're running,adjudicated by the same group of cardiologist specialists who

found no risk . It's an anomaly . It doesn't fit with anything that we

know .

Insana: What if the FDA decides that COX-2 inhibitors, as a class,are not suitable for public consumption? What do you do as acompany?

McKinnell : We have to obviously remove the drug from themarket . That would be a shame for the millions of people who relyon Celebrex as their best option, or in some cases, their only optionto live a normal life .

(Emphasis added ) . Defendant McKinnell made false and misleading statements in the USA

Today article regarding the cardiovascular safety of Celebrex in that he failed to disclose material



by misrepresenting that clinical data for Celebrex showed no evidence of cardiovascular risk .

Defendant McKinnell should have disclosed information about Celebrex, such as that mandated



102

226 . On January 19, 2005, Pfizer filed a Form 8-K with the SEC attaching a pres s

release announcing its financial results for the fourth quarter of 2004 ( the "January 19, 200 5

Form 8-K"). In its January 19, 2005 Form 8-K, with an attached press release, Pfizer made th e

following misrepresentations, and further omitted disclosures of the dangerous facts of whic h

Pfizer was already aware :

Q27) What are the implications for Pfizer of the FDA's upcomingAdvisory Committee meeting concerning the safety of COX-2-specific medicines?

A27) . . . We will be participating in the Advisory Committeemeeting, and we look forward to a reasoned scientific discussion inwhich we will provide data in support of our belief that Celebrexand Bextra present a cardiovascular risk profile comparable to thatof non-selective non-steroidal anti-inflammatory drugs and areimportant therapeutic options . Pfizer's submission to the FDA willbe posted on the FDA website .

227. In the January 19, 2005 Form 8-K, Pfizer misleadingly spun as "new news, "

requiring "considerable additional analysis," the issue of increased cardiovascular risks o f

Celebrex and Bextra :

Q28) What new cardiovascular information has been obtainedabout Celebrex?

A28) In December 2004, three controlled prevention studiesinvolving Celebrex were halted . These three studies providepreliminary but inconsistent information . More specifically, onDecember 16, 2004, Pfizer learned of new information concerningtwo of these studies -- large, well-controlled cancer-preventionstudies involving patients who took high doses of Celebrex . Onestudy, sponsored by the National Cancer Institute and involvingpatients taking 400 mg/day and 800 mg/day of Celebrex, showedan increase in overall cardiovascular events, such as heart attack,stroke, and death, compared to placebo . The second study,sponsored by Pfizer and involving patients taking 400 mg/day ofCelebrex, did not show an increased overall cardiovascular riskover placebo. A third large, well-controlled Alzheimer's preventionstudy sponsored and conducted by the National Institute on Aging,a part of the National Institutes of Health, reported preliminaryinformation on December 20, 2004. This third study had enrolledmore than 2,400 patients over the previous 3 1/2 years to determin e

103

if Celebrex 400 mng/day or Aleve (naproxen sodium) 440 mg/daywere effective treatments to prevent the development ofAlzheimer's disease in people at risk of developing this seriousdisease. Preliminary safety results from the study indicated in part"an apparent increase in cardiovascular and cerebrovascular eventsamong the participants taking naproxen sodium when comparedwith those on placebo ." No increased cardiovascular risk was seenin patients taking Celebrex relative to placebo . We believe thesethree studies require considerable additional analysis before anyconclusions can be reached .

228. The January 19, 2005 Form 8-K made false and misleading statements regarding

the cardiovascular safety of Celebrex and Bextra in that it failed to disclose material advers e


cardiovascular and thrombotic risks associated with Celebrex and Bextra, demonstrated by th e

1999 Study and CABG Trial 35, by misrepresenting that Celebrex and Bextra were safe . The

January 19, 2005 Form 8-K should have disclosed information about Celebrex, such as that



229. On February 1 6 through 18, 2005, the FDA's Arthritis and Drug Safety and Ris k

Management Advisory Committees held a joint meeting concerning , among other things, the

safety profile of Celebrex and Bextra . During that meeting Defendant Feczko made th e


[T]he data 'demonstrates the cardiovascular safety pro fi le of ourCOX-2 inhibitors, both Celebrex, Bextra and parecoxib . "

We believe that this data shows that the cardiovascular safety ofCelebrex is at least on a par with therapeutic alternatives such asthe non-selective NSAIDs .

In conclusion, I continue to be confident that Celebrex and Bextra

have important treatment options for arthritis patients . I actually

104

believe that there is no effective treatment for arthritis patients thatis safer than Celebrex .

At the joint meeting of the FDA's Arthritis and Drug Safety and Risk Management Advisory

Committees, Defendant Feczko made false and misleading statements regarding the

cardiovascular safety of Celebrex and Bextra in that he failed to disclose material adverse


cardiovascular and thrombotic risks associated with Celebrex and Bextra, demonstrated by the

1999 Study and CABG Trial 35, by misrepresenting that available data supports Celebrex and

Bextra's cardiovascular safety profile . Defendant Feczko should have disclosed information


carries concerning the cardiovascular risks associated with its use .

230. On April 5, 2005, Pfizer filed a Form 8-K with the SEC attaching a press releas e

(the "April 5, 2005 Form 8-K"). Although referring to "uncertainties" that included "the outlook

for our COX-2 franchise," the April 5, 2005 Form 8-K misleadingly failed to disclose Pfizer's

knowledge that its COX-2 franchise was based on dangerous products that were sure to be

investigated and either banned, strictly limited or further regulated and labeled .

231 . Rather than come clean with the medically and economically devastating truth

that Celebrex and Bextra were not only not superior to traditional NSAIDs in terms of

gastrointestinal safety, but, worse, posed substantial risks of serious cardiovascular harms, Pfizer

chose to conceal those crucial truths . Misleading patients, doctors and investors, Pfizer spun the

less damning story that COX-2's "needed more study : "

For the COX-2 portfolio, Pfizer looks forward to finalizingchanges to its U.S. labeling with the U.S. Food and DrugAdministration (FDA) as well as moving ahead with plans forclinical studies to further explore the benefits as well as the risks ofthe COX-2 specific medicines compared to older, non-selectivemedicines . In the interim, Pfizer remains focused on theimportance of these products for millions of patients around th e

105

world. "We believe that, with continued clinical work andappropriate labeling, these medicines will remain importanttreatment options for patients and doctors for many years to come,"Katen said .

The April 5 . 2005 Form 8-K made false and misleading statements regarding the cardiovascular

safety of Celebrex and Bextra in that it failed to disclose material adverse information then

known by or recklessly disregarded by the Defendants concerning the cardiovascular and

thrombotic risks associated with Celebrexand Bextra, demonstrated by the 1999 Study and

CABG Trial 35, by misrepresenting that Celebrex and Bextra were safe . The April 5, 2005 Form

8-K should have disclosed information about Celebrex, such as that mandated by the FDA in the

"black box" warning Celebrex now carries concerning the cardiovascular risks associated with

its use .

IX. APPLICABLE GAAP VIOLATIONS

A. Failure To Comply With Regulation S-K, Item 303

232. Federal Regulations strictly govern what must be included in documents filed

with the SEC. Specifically, Regulation S-K provides, in part, that annual and period reports

must contain a section entitled "Management's discussion and analysis of financial condition and

results of operations" (the "Management Discussion"). See I7 C .F.R. § 229.10, et seq .

233 . Items 303 of Regulation S-K, 17 C .F.R. § 229 .303 ("Item 303"), governs what

must be contained in the Management Discussion . Item 303 requires, in part, that the

Management Discussion must :

Discuss registrant's financial condition, changes in financialcondition and results of operations . The discussion shall provideinformation as specified in paragraphs (a)(1) through (5) of thisItem and also shall provide such other information that theregistrant believes to be necessary to an understanding of itsfinancial condition, changes in financial condition and results ofoperations .

106

234. Paragraph (a)(3) of Item 303 requires, in part, that the Management Discussio n

discuss a company's "results of operations" as follows :

(i) Describe any unusual or infrequent events or transactions or anysignificant economic changes that materially affected the amountof reported income from continuing operations and, in each case,

indicate the extent to which income was so affected . In addition,

describe any other significant components of revenues or expenses

that, in the registrant's judgment, should be described in order tounderstand the registrant's results of operations .

(ii) Describe any known trends or uncertainties that have had or thatthe registrant reasonably expects will have a material favorable orunfavorable impact on net sales or revenues or income fromcontinuing operations . If the registrant knows of events that willcause a material change in the relationship between costs andrevenues (such as known future increases in costs of labor ormaterials or price increases or inventory adjustments), the changein the relationship shall be disclosed .

235 . Congress provided instructions in the Notes to Item 303 to clarify what is required

of publicly - fi ling companies like Pfizer . Instructions I - 3 provide :

1 . The registrant's discussion and analysis shall be of thefinancial statements and of other statistical data that theregistrant believes will enhance a reader's understanding ofits financial condition, changes in financial condition and

results of operations . Generally, the discussion shall coverthe three year period covered by the financial statements

and shall use year-to-year comparisons or any other formatsthat in the registrant's judgment enhance a reader'sunderstanding. However, where trend information is

relevant, reference to the five year selected financial dataappearing pursuant to Item 301 of Regulation S-K (§

229 .301) may be necessary .

2 . The purpose of the discussion and analysis shall be toprovide to investors and other users information relevant to

an assessment of the financial condition and results ofoperations of the registrant as determined by evaluating the

amounts and certainty of cash flows from operations andfrom outside sources .

3 . The discussion and analysis shall focus specifically on

material events and uncertainties known to managementthat would cause reported financial information not to b e

107

necessarily indicative of future operating results or offuture financial condition. This would include descriptionsand amounts of (A) matters that would have an impact onfuture operations and have not had an impact in the past,and (B) matters that have had an impact on reportedoperations and are not expected to have an impact uponfuture operations .

236 . The Defendants had knowledge of material adverse information concerning th e

cardiovascular and thrombotic risks associated with Celebrex and Bextra and the impact that

those risks could have on Pfizer and its financial statements during the Class Period and, had an

obligation to disclose such risks pursuant to Regulation S-K, Item 303 . Their failure to do so

renders their Class Period SEC filings materially incomplete, false and misleading . The

materially incomplete, false and misleading SEC filings include : November 1, 2000 Form 8-K

(all dates are "filed" dates and all filings include attachments such as financial results and press

releases) ; January 24, 2001 Form 8-K; March 28, 2001 Form 10-K405 ; November 13, 2001

Form 10-Q; July 15, 2002 Form 425 ; August 13, 2002 Form 10-Q ; October 16, 2002 Form 425

(press release) ; November 13, 2002 Form 10-Q; March 27, 2003 Form 10-K ; April 22, 2003

Form 8-K; May 14, 2003 Form 10-Q; July 25, 2003 Form 8-K ; October 22, 2003 Form 8-K ;

January 22, 2004 Form 8-K; April 20, 2004 Form 8-K ; May 7, 2004 Form 10-Q ; July 21, 2004

Form 8-K; August 6, 2004 Form 10-Q ; October 15, 2004 Form 8-K; October 20, 2004 Form 8-

K; November 5, 2004 Form 10-Q ; January 19, 2005 Form 8-K ; February 28, 2005 Form I O-K ;

April 5, 2005 Form 8-K; April 19, 2005 Form 8-K ; May 6, 2005 Form 10-Q ; July 20, 2005 Form

8-K; and August 8, 2005 Form 10-Q .

B. Failure To Comply With Regulation S- X

237 . At all relevant times during the Class Period, Pfizer represented that its financial

statements were prepared in conformity with GAAP, the uniform rules, conventions and

procedures that define accepted accounting practice . As set forth in Statement of Financia l

108

Accounting Concepts ("SFAC") No . 1, "Objective of Financial Reporting by Business

Enterprises ," one of the fundamental objectives of financial reporting is to provide accurate and

reliable information concerning an entity's financial performance during the period being

presented . For example , SFAC No. 1, 42 states :

Financial reporting should provide information about anenterprise's financial performance during a period . Investors andcreditors often use information about the past to help in assessingthe prospects of an enterprise . Thus, although investment andcredit decisions reflect investors' and creditors' expectations aboutfuture enterprise performance, those expectations are commonlybased at least partly on evaluations of past enterprise performance .

238 . GAAP defines acceptable accounting practices . Both annual and interim (e .g. ,

quarterly) financial statements must be prepared in accordance with GAAP . The SEC requires

GAAP presentation in Regulation S-X, 17 C .F.R. §210 .4-01(a)(1), which provides that financial

statements filed both annually and quarterly with the SEC must comply with GAAP, except

quarterly statements are not required to have the same level of footnote disclosure . If the filings

do not comply with GAAP, they are "presumed to be misleading and inaccurate," despite

footnote or other disclosure. See Regulation S-X, 17 C .F .R. §210.4-01(a)(1) (emphasis added) .

239. GAAP consists of a hierarchy of authoritative literature . The highest authority i s

comprised of Financial Accounting Standards Board (`FASB") Statements of Financial

Accounting Statements ("SFAS'), FASB Interpretations ("FIN"), APB Opinions ("APB"), and

AICPA Accounting Research Bulletins ("ARB") . GAAP provides other authoritative

pronouncements including, among others, AICPA Statements of Position ("SOP'), Consensus

Positions of the FASB Emerging Issues Task Force ("EITF"), and the FASB Concept Statements

("FASCON') .

109

240. The responsibility for preparing financial statements that conform to GAAP rest s

with corporate management, as set forth in AU Section 110 .03 of the AICPA Professiona l

Standards :

The financial statements are management's responsibility . . . .

Management is responsible for adopting sound accountingpolicies and for establishing and maintaining internal control,

that will, among other things initiate, record, process, and reporttransactions (as well as events and conditions) consistent withmanagement's assertions embodied in the financial statements .

The entity's transactions and the related assets, liabilities, andequity are within the direct knowledge and control of management

. . . . TI:us, the fair presentation of financial statements inconformity with [GAAPJ is an implicit and integral part of

management's responsibility .

(Emphasis added) .

241 . As such, GAAP imposes upon public companies , such as P fizer, a duty to :

1 . disclose in periodic reports filed with the SEC "knowntrends or any known demands, commitments, events oruncertainties" that are reasonably likely to have amaterial impact on a company's sales revenues, incomeor liquidity, or cause previously reported financialinformation "not to be necessarily indicative of futureoperating results or future financial condition ." 17C.F.R. § 229.303(a)(l)-3(3) and Instruction 3 ; and

2. "make full and prompt announcements of material factsregarding the company's financial condition," as::[i]nvestors have legitimate expectations that publiccompanies are making, and will continue to make,prompt disclosure of significant corporatedevelopments ." SEC Release No. 34-8995, 3 Fed . Sec .L. Rep. (CCH) ¶ 23,120A, at 17,095 17 C.F .R. §241 .8995 (October 15, 1970) ; SEC Release No . 18271,

[1981-1982 Transfer Binder] Fed . See . L. Rep. (CCH)83,049, at 84,618 (November 19, 1981) .

242. Pursuant to these requirements, and as detailed herein, the Defendants cause d

Pfizer to represent that its financial statements complied with SEC regulations and were prepare d

in conformity with GAAP in all material respects when that was not the case . As a result,

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Pfizer's financial statements were materially false and misleading . See Regulation S-X, 17

C. F . R. § 210.4-0 1 (a)(1) .

C. Failure To Disclose Increasing Contingent Liabilitie s

243 . In addition to their failure to disclose, and misrepresentation of, known problems

with Celebrex and Bextra, the Defendants defrauded investors during the Class Period by failing

to disclose, as GAAP requires in the context of the Company's financial statements, the

Company's contingent liabilities and signil :icant risks and uncertainties related to Celebrex and

Bextra .

244. GAAP requires that financial statements disclose contingencies when it is at least

reasonably possible (i.e ., a greater than slight chance) that a loss may have been incurred . See

SFAS No . 5, ~ 10. The disclosure is required to indicate the nature of the contingency and shall

give an estimate of the possible loss, a range of loss, or state that such an estimate cannot be

made . Id.

245 . The SEC considers the disclosure of such loss contingencies to be so important t o

an informed investment decision that it issued Article 10-01 of Regulation S-X 17 C .F.R.

§ 210.10-01, which provides that although disclosures in interim period financial statements may

be abbreviated and need not duplicate the disclosure contained in the most recent audited

financial statements, "where material contingencies exist, disclosure of such matters shall be

provided even though a significant change since year end may not have occurred ."

246. In addition, GAAP requires that financial statements disclose significant risks and

uncertainties associated with an entity"s business . See Disclosure of Risks and Uncertainties,

Statement of Position No. 94-6.

247 . In violation of GAAP, Pfizer's Class Period financial statements improperly

failed to disclose both (a) the risks associated with Celebrex and Bextra ; and (b) that it s

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concealment and misrepresentation of those risks, exposed Pfizer to further substantial risks an d

uncertainties, as detailed herein .

248. Instead of disclosing the very real and substantial contingencies that accompanie d

the sales of Celebrex and Bextra (e .g., personal injury claims and other litigation) in th e

Company's SEC filings, the Defendants attempted to minimize their significance by referring

generally to product liability and other suits by misleadingly stating :

We and certain of our subsidiaries are involved in various patent,product liability, consumer, commercial, environmental, and taxlitigations and claims; government investigations; and other legalproceedings that arise from time to time in the ordinary course ofour business . We do not believe any of them will have a materialadverse effect on our financial position .

See Pfizer Quarterly Report for the First Quarter of 2004 on Form 10-Q .

X. SCIENTER/FRAUDULENT INTEN T

A. General Allegations Of Scienter

249 . The Individual Defendants were active , culpable, and primary participants in th e

fraud by virtue of (1) their receipt of information reflecting the cardiovascular and thromboti c

risks associated with Celebrex and Bextra described herein and/or their failure to revie w

information they had a duty to monitor ; (2) their actual issuance and control over Pfizer's

materially false and misleading statements ; (3) their supervision over employees and actual

direction of policies that encouraged the fraud ; and (4) their association with the Company which

made them privy to confidential information concerning the Company . The Individual

Defendants knew or recklessly disregarded the materially false and misleading nature of the

information they caused to be disseminated to the investing public . The Individual Defendants

also knew or recklessly disregarded that the cardiovascular and thrombotic risks associated wit h

Celebrex and Bextra that caused Pfizer's financial statements to be materially false an d

misleading would adversely affect the integrity of the market for the Company's common stoc k

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and would cause the price of the Company's common stock to be artificially inflated . The

Individual Defendants acted knowingly or in such a reckless manner as to constitute fraud and

deceit upon Plaintiffs .

250. As a result of having reviewed or having access to various studies, including th e

1999 Study and CABG Trial 35, the Defendants engaged in a pattern of deceit by failing to

disclose such material adverse information The Defendants also manipulated data from clinica l

studies on Celebrex and Bextra which was certain to have a material adverse effect on the future

expected revenues of Celebrex and Bextra. Accordingly, the Defendants engaged in a scheme t o

defraud and engaged in a practice that operated as a fraud on Pla intiffs .

251 . The Defendants' scienter is evidenced by the intentional concealment of the 199 9

Study and the CABG Trial 35, the fact that Pfizer had worked closely on all aspects of Celebrex

since its co-promotion agreement with Searle in February 1998, the fact that scientific

knowledge and the results of trials were widely disseminated among the Celebrex and Bextra

brand teams, and the fact that senior management worked closely with the Celebrex and Bextra

brand teams .

B. The Individual Defendants Were In Positions Of Actual Control And/OrSupervision Of Pfizer's Manipulative Practices

252. The Individual Defendants directed , knew about or recklessly disregarded the

fraudulent practices implemented under their watch . As officers of the Company, Defendants

McKinnell, LaMattina, Katen, Cawkwell and Feczko each knew, through direct knowledge or

knowledge learned through the supervisory nature of their positions or recklessly disregarde d

and failed to disclose, material adverse information ; were involved in the decisions concernin g

Celebrex and Bextra made at the Company ; and, made false and misleading statements o f

material fact.

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253. At Pfizer. all the top management had knowledge of the lack of disclosure of

material adverse information concerning the cardiovascular and thrombotic risks associated with

Celebrex and Bextra . Plaintiffs' counsel spoke with Dr . John J. Talley, who invented Celebrex

in 1993 and Bextra in 1994. Dr. Talley worked under the direction of Dr . Philip Needleman, the

chief scientist and head of Pfizer's (then Searle's) research and development on selective COX -

2 inhibitors . According to Dr. Talley, members of senior management were well aware of the

clinical studies that were conducted on Celebrex and Bextra . Statements by former employees o f

Pharmacia (now Pfizer) who worked on Celebrex, Krista S . Fox, Paul V. Dodson and Andrew

Watson, confirf'n that any negative effect or problem with a drug was reported to top

management . The Celebrex and Bextra brand teams, knew all about the science behind Celebrex

and Bextra including early medical trials and the undisclosed negative cardiovascular effects .

(See supra Section V.F) .

L Defendant McKinnel l

254. As Pfizer's President, Chief Executive Officer and Chairman of the Board of

Pfizer, Defendant McKinnell spearheaded Pfizer's launch of Celebrex and Bextra and steered

Pfizer's failure to disclose material adverse information and the issuance of false and misleading

statements concerning Celebrex and Bextra throughout the Class Period . Furthermore, as a

senior officer, McKinnell knew about the results of the clinical trials of Bextra and Celebrex .

255 . As CEO of Pfizer during the Class Period, McKinnell had the opportunity to

commit fraud . Defendant McKinnell signed the Company's SEC filings, made statements during

interviews and conference calls which contained materially false and misleading statements

and/or omitted to state material facts . In his position as CEO, McKinnell signed Pfizer's

certifications pursuant to §302 of the Sarbanes-Oxley Act of 2002, and he is responsible for the

accuracy of the Company's public statements concerning Celebrex and Bextra . McKinnell mad e

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materially false and misleading statements concerning Celebrex and Bextra's cardiovascular

effects and he failed to disclose in the Company's SEC filings the necessity that Celebrex carry a

black box warning label, the lack of medical and commercial viability of Bextra, and the

constantly increasing liabilities Pfizer was incurring in connection with Celebrex and Bextra

which caused Pfizer's financial results and future growth prospects to be materially misleading .

256. Defendant McKinnell had a motive to commit the fraud alleged herein because he

had a tremendous stake in Pfizer's success . Indeed, his reputation was intimately connected with

the success of the Company and its blockbuster drugs, including Celebrex and Bextra .

Furthermore, during the Class Period, Defendant McKinnell's compensation was tied directly to

the performance of the Company . Defendant McKinnell received more than $17 million in

annual salary and bonuses plus millions of dollars in awards of common stock, stock options and

other compensation under the Company's various executive compensation incentive award

plans, plus other lucrative remuneration and compensation, including the use of the Company's

transportation, as well as a handsome retirement package . As noted in the paragraph below,

McKinnell was highly motivated to continue to receive the lucrative compensation and ever

increasing bonuses until his retirement.

257. As referenced in Pfizer's SEC No Action Letter, filed December 19, 2005 ,

Pfizer's senior executive officers, including McKinnell, will receive pension benefits pursuant to

Pfizer's Nonfunded Supplemental Retirement Plan (as amended through 1/96) . Therefore, upon

his retirement in 2008, Defendant McKinnell will receive a retirement plan, including a pension

plan, that is worth approximately $83 million or approximately $6 .5 million a year . Defendant

McKinnell's current 2005 salary is $6 .5 million. While most Americans' pensions are less than

their salary while employed, as long as McKinnell holds his job through 2008, McKinnell's

retirement will be as lucrative as his present salary . Because McKinnell's lucrative retiremen t

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package is available to him only if he holds his job through 2008, his retirement plan provided

further incentive to make Celebrex and Bextra "blockbuster" drugs at any cost .

H. Defendant LaMattina

258. As Pfizer's Senior Vice President and President of Pfizer's Global Research an d

Development since October 2003, and having worked at Pfizer for some 30 years, Defendant

LaMattina knew virtually every fact regarding the Company's research and development .

Indeed, Defendant LaMattina has played an important part in Pfizer's research and development

department for thirty years . Furthermore, as a senior officer, LaMattina knew about the clinical

trials of Bextra and Celebrex .

259 . As an executive officer and a member of Pfizer's Leadership Team, the highes t

level decision-making group within the Company, Defendant LaMattina had the opportunity to

commit fraud . As a member of Pfizer's Leadership Team, Defendant LaMattina made major

decisions effecting corporate finance, capital investment, operations of Pfizer's core businesses,

human resources, legal strategy, corporate affairs and government relations .

260. Defendant LaMattina had motive to commit the fraud alleged herein, because he

also had a tremendous stake in Pfizer's success . During the Class Period, LaMattina's

compensation was tied directly to the performance of the Company, and over the years, including

during the Class Period, he received millions of dollars in annual salary and bonuses, restricted

stock and stock options and other lucrative compensation under the Company's various

executive compensation and incentive plans . As noted in Section X .C . below, LaMattina's

salary and bonuses were tied directly to the Company's growth and performance .

iii. Defendant Kate n

261 . As a member of the Corporate Management Committee and Pfizer's Leadership

Team. Defendant Katen had the opportunity to commit fraud by making strategic decision s

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effecting corporate finance, capital investment, operations of Pfizer's core businesses, human

resources, legal strategy, corporate affairs and government relations . As President of Pfizer

Human Health since 2005 and prior thereto, as President of Pfizer-U.S . Pharmaceutical Group

and Executive Vice President and President of Pfizer-Global Pharmaceuticals during the Class

Period, Defendant Katen was actively involved in the launch of every new pharmaceutical

product at Pfizer since 1975, including Celebrex and Bextra . Furthermore, as a senior officer,

Katen knew about the clinical trials of Celebrex and Bextra .

262. Since 1975, Defendant Katen has been in a high level supervisory position . Katen

has personally assembled and supervised cross-functional groups, including scientists,

physicians, and sales people, to launch Pfizer's pharmaceutical products . The team members

under Defendant Katen's supervision often worked together for the full period of a drug, often

more than a decade, during which time the product would undergo clinical trials and await

regulatory approval by the FDA as well as be marketed and sold .

263. During the Class Period, Katen's compensation was tied directly to th e

performance of the Company . As one of Pfizer's most senior executives, Katen received

millions of dollars in annual salary, bonuses, and awards of common stock, stock options and

other compensation and lucrative benefits from the Company under the Company's various

executive compensation and incentive plans . As noted in Section X .C . below, Katen's salary and

bonuses were tied directly to the Company's growth and performanc e

264. As a public voice for Pfizer, Defendant Katen was in the position t o

communicate, as she did during the Class Period on conference calls and in press releases and

other public documents, false and misleading statements concerning Celebrex's and Bextra's

cardiovascular effects. Defendant Katen made numerous public statements concerning Celebrex

and Bextra during the Class Period that were materially false and misleading and/or omitte d

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material facts concerning the medical and commercial viability of Celebrex and Bextra as a

result of the severe cardiovascular and thrombotic risks that Celebrex and Bextra presented .

265 . As one of three possible candidates for McKinnell 's position , as noted i n

Business Week Online, dated October 13, 2005, Defendant Katen needed Bextra and Celebrex to

be blockbuster drugs to bolster Pfizer's growth and performance .

iv. Defenda nt Feczko

266. As Vice President, Executive Vice President of Pfizer Global Research an d

Development, and President of Pfizer Worldwide Development, Defendant Feczko had the

opportunity to communicate, as he did during the Class Period on conference calls and in pres s

releases, false and misleading statements concerning Celebrex`s and Bextra's cardiovascula r

safety . Furthermore, as a senior officer at Pfizer, Feczko knew about the clinical trials of Bextr a

and Celebrex .

v. Defendant Cawkwel l

267. As Pfizer 's worldwide medical director for Celebrex, Defendant Cawkwell ha d

the opportunity to communicate as she did during the Class Period in statements to the press ,

false and misleading information about Celebrex and Bextra . Furthermore, as worldwide

medical director, Cawkwell knew about the clinical trials of Bextra and Celebrex.

C. Pfizer's Compensation Policies Provided Motive To The IndividualDefendants To Perpetuate The Celebrex And Bextra Frau d

268. Pfizer's 100 highest-ranked employees, including inside directors, are eligible t o

compete in the 2001 Performance-Contingent Share Award Plan . Employees receive variable

long-term incentive stock awards . Officers at the senior vice president level and above receive d

half of the value of their annual variable long-term incentive award in the form of performanc e

shares and half in the form of stock options . The performance share awards were based on two

performance criteria - 50% diluted earnings per share growth, and 50% total shareholder return -

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measured over a performance period relative to the performance of a peer group . For example,

McKinnell earned 192,000 shares for the 1997-2001 performance period ; 169,920 shares for the

1998-2002 performance period ; and 75,060 shares for the 1999-2003 performance period . The

Individual Defendants received a number of Performance-Contingent Shares in addition to

receiving performance-contingent share awards and stock options .

269. Pfizer's executive compensation package is broken into three components :

salary, annual incentive and long-term incentive with an emphasis on performance-based

incentive compensation . Pfizer's compensation policies - which were reviewed and approved

each year by the Compensation Committee of the Board - created a strong incentive for the

Individual Defendants to continue to conceal and recklessly disregard that the cardiovascular and

thrombotic risks associated with Celebrex and Bextra that caused Pfizer's financial statements to

be materially false and misleading which would adversely affect the integrity of the market for

the Company's common stock and would cause the price of the Company's common stock to be

artificially inflated .

270. As noted below, from at least 2000 through the end of the Class Period,

Defendants McKinnell, LaMattina, and Katen received lucrative compensation and ever-

increasing cash bonuses .

271 . From 2000 through 2005, McKinnell's base salary was $10 .8 million, he received

bonuses of $20 million, $5 .7 million in restricted stock, $3 .5 million in options, and $26 million

in long term incentive payouts all tied to the financial performance of the Company .

272. Similarly, from 2000 through 2005, LaMattina's base salary was close to $3

million, he received bonuses of over $2 .4 million, $1 .7 million in restricted stock, $375,000 in

options, and $3 .6 million in long-term incentive payouts all tied to the financial performance of

the Company .

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273 . Katen, too, received lucrative compensation . From 2000 through 2005, Kate n

received a base salary of over $5 .9 million, bonuses of over $6 .9 million, $3 .3 million in

restricted stock awards, $1 .37 million in options, and $14 million in long-term incentive payout s

all tied to the financial performance of the Company.

XI. FRAUD ON THE MARKET

274. At all relevant times, the market for Pfizer's common stock was efficient for th e

following reasons, among others :

Pfizer common stock met the requirements for listing, and was listed and

actively traded on the NYSE (symbol PPE), a highly efficient and

automated market ;

b. As a regulated issuer, Pfizer filed regular reports with the SEC ;

Pfizer regularly communicated with public investors via establishedmarket communication mechanisms, including through regulardisseminations of press releases on the national circuits of major newswireservices and through other wide-ranging public disclosures, such ascommunications with the financial press and other similar reportingservices ;

d . Pfizer was regularly followed by numerous securities analysts employedby major brokerage firms headquartered in the United States and overseaswho wrote reports that were distributed to the sales forces and certaincustomers of their respective brokerage firms . Each of these reports waspublicly available and entered the public marketplace ;

e. The material misrepresentations and omissions alleged herein would tendto induce a reasonable investor to misjudge the value of Pfizer's securities ;and

Without knowledge of the misrepresented or omitted facts, Plaintiffspurchased or otherwise acquired Pfizer common stock between the timethat the Defendants made the material misrepresentations and omissionsand the time that the truth was revealed, during which time the price ofPfizer common stock was artificially inflated by the Defendants'misrepresentations and omissions .

275 . As a result of the foregoing, the market for Pfizer common stock promptly reacte d

to current information regarding Pfizer from publicly available sources and reflected such

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information in the trading price of Pfizer common stock . Under these circumstances . a

presumption of reliance applies.

XII. NO SAFE HARBOR

276. As alleged herein, the Defendants acted with scienter because at the time that the y

issued public documents and other statements in Pfizer's name, they knew or recklessly

disregarded the fact that such statements were materially false and misleading or omitted

material facts . Moreover, the Defendants knew such documents and statements would be issue d

or disseminated to the investing public, knew that persons were likely to rely upon those

misrepresentations and omissions, and knowingly and recklessly participated in the issuance and

dissemination of such statements and documents as primary violators of the federal securities

laws .

277. As set forth in detail throughout this Complaint, the Defendants, by virtue of thei r

control over, and/or receipt of Pfizer's materially misleading statements and their positions with

the Company that made them privy to confidential proprietary information concerning Celebrex

and Bextra, used such information to artificially inflate Pfizer's financial results . The

Defendants created, were informed of, participated in and knew of the scheme alleged herein to

distort and suppress material information pertaining to Celebrex's and Bextra's medical risks and

tenuous commercial viability . With respect to non-forward looking statements and omissions,

the Defendants knew and recklessly disregarded the falsity and misleading nature of that

information, which they caused to be disseminated to the investing public .

278. The statutory safe harbor provided for forward-looking statements under certain

circumstances does not apply to any of the false statements pleaded in this Complaint . None of

the statements pleaded herein are "forward-looking" statements and no such statement was

identified as a "forward-looking statement" when made . Rather, the statements alleged herein t o

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be false and misleading by affirmative misstatement and/or omissions of material fact all relate

to facts and conditions existing at the time the statements were made . Moreover, cautionary

statements, if any, did not identify important factors that could cause actual results to differ

materially from those in any putative forward-looking statements .

279 . In the alternative, to the extent that the statutory safe harbor does apply to an y

statement pleaded herein which is deemed to be forward-looking, the Defendants are liable for

such false forward- looking statements because at the time each such statement was made, the

speaker actually knew andlor recklessly disregarded the fact that forward-looking statements

were materially false or misleading and/or omitted facts necessary to make statements previously

made not materially false and misleading, and/or that each such statement was authorized and/or

approved by a director and/or executive officer of Pfizer who actually knew or recklessly

disregarded the fact that each such statement was false and/or misleading when made . None of

the historic or present tense statements made by the Defendants was an assumption underlying or

relating to any plan, projection, or statement of future economic performance, as they were not

stated to be such an assumption underlying or relating to any projection or statement of future

economic performance when made nor were any of the projections or forecasts made by the

Defendants expressly related to or stated to be dependent on those historic or present tense

statements when made-

XIII. LOSS CAUSATION

280 . Plaintiffs were damaged as a result of the Defendants' fraudulent conduct set forth

herein. From the beginning of the Class Period through October 2004, the Defendants repeatedly

misrepresented the safety and efficacy of Celebrex and Bextra and failed to disclose material

information. Pfizer's stock price during the Class Period rose to $47 .44 on December 19, 2000

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and its average closing price was between approximately $31 to $41 throughout 2001, 2002,

2003 and a good part of 2004 .

281 . During this time, Plaintiffs, composed of TRSL., other named plaintiffs and

thousands, if not millions of class members, purchased Pfizer stock at artificially inflated prizes .

Plaintiffs suffered damages as the truth gradually came out which negatively affected Pfizer's

stock price . For example, beginning in mid-October 2004, Pfizer stock began to decline as the

market started to learn the true dangers of Celebrex and Bextra and that they are not, and never

should have been, the blockbuster drugs that Pfizer had touted to the market for so many years .

Between October 18, 2004 and October 22, 2004, Pfizer's shares fell $1 .26 from $29.00 to close

at $27.74 per share - a 4.3% decline that reduced Pfizer's market capitalization by more than

$9.5 billion .

282. Subsequently, on November 17, 2004, David Graham of the FDA further

questioned the safety of Pfizer's COX-2 drugs Celebrex and Bextra, further undermining their

perceived status as blockbuster drugs . Accordingly, between November 17, 2004 and November

24, 2004, Pfizer's shares fell $1 .20 from $27.99 to close at $26.79 per share - a 4.3% decline that

reduced Pfizer's market capitalization by more than $9 .0 billion .

283. On December 17, 2004, Pfizer finally revealed what it had known for years,

although it did not admit its prior knowledge, that Celebrex, one of its largest-selling drugs, was

linked to an increased risk of heart attack . The market reacted swiftly and negatively, punishing

Pfizer's stock . Between the close on December 16, 2004 and December 20, 2004, Pfizer' s

shares fell $4 .69 from $28.98 to close at $24.29 per share - a 16.2% decline that reduced Pfizer"s

market capitalization by more than $35 .3 billion .

123

284 . On February 1, 2005, the results of the 1999 Study were publicly disclosed in an

article published in the New York Times . Between the close on January 31, 2005 to the close on

February 1, 2005, Pfizer's stock fell from $24 .16 to $23 .86, a 1 .2% decline .

285 . Beginning in 2005, Pfizer was forced to withdraw Bextra from the market entirel y

and place a "black-box" warning on Celebrex that should have been included from the launch of

the drug. As the market began to understand the full impact of these revelations on Pfizer s

future revenues and earnings, its stock began another precipitous decline . Thus, on July 20,

2005, Pfizer released its Form 10-Q for the Second Quarter of 2005, showing a decline in

revenue from COX-2 drugs . Between the close on July 19, 2005 and July 26, 2005, Pfizer's

shares fell $1 .14 from $27 .38 to close at $26.24 per share - a 4 .2% decline that reduced Pfizer's

market capitalization by more than $8 .5 billion .

286. Thereafter, on October 20, 2005, Pfizer released its results for the Third Quarte r

of 2005, and informed the market that the declines in its revenue caused by the revelations about

Celebrex and Bextra were not short-term phenomena, but would continue into the future . The

market again reacted negatively, and between the close on October 19, 2005 and October 26,

2005, Pfizer's shares fell $2 .91 from $23 .97 to $21 .06 per share -- a 12 .1% decline that reduced

Pfizer's market capitalization by more than $21 .4 billion,

XIV. TOLLING ALLEGATION S

287. Between December 15, 2004 and June 16, 2005, numerous class actions wer e

filed in various federal district courts, including 23 actions in the Southern District of New York,

three actions in the District of Connecticut , two actions in the District of New York, and one

action in the Northern District of Illinois . These securities class actions were consolidated under

In re Pfizer Securities Litigation , MDL 05-1688 (RO). Thus, because the proposed class period

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does not extend back beyond five years, see 28 U.S.C . § 1658(b)(2), none of Plaintiffs' claims

are time-barred .

288 . In any event, statements by the Defendants during the Class Period assured

Plaintiffs and the investing public that any partly cloudy skies or mild winds were not warnings

of a storm. By falsely assuring Plaintiffs and the investing public that no study showed an

increased risk for heart attack and stroke, the Defendants acted like weathermen in connection

with any early storm warnings - the Defendants had all the information, technology and

expertise to render the forecast . They assured Plaintiffs and the investing public that the clouds

would surely break and the wind would surely die down, giving way to an overall calm and

sunny day for Celebrex and Bextra . In this way, any statute of limitations is tolled. Plaintiffs

and the investing public were not at fault for being caught without their umbrellas after the

Defendants assured them that no umbrellas were necessary because no storm was coming .

XV. CLASS ACTION ALLEGATION S

289. Lead Plaintiff and the named plaintiffs bring this action as a class action pursuant

to Rule 23(a) and (b)(3) of the Federal Rules of Civil Procedure on behalf of all persons and

entities who purchased Pfizer common stock during the Class Period and who suffered damages

as a result of their purchases (the "Class") . Excluded from the Class are (1) the Company and

the Individual Defendants ; (2) members of the immediate family of each of the Individual

Defendants; (3) the subsidiaries or affiliates of the Company or any of the Defendants ; (4) any

person or entity who is, or was during the Class Period, a partner, officer, director, employee or

controlling person of the Company or any of the Defendants; (5) any entity in which any of the

Defendants has a controlling interest (6) the legal representatives, heirs, successors or assigns of

any of the excluded persons or entities specified in this paragraph; and (7) the insurance carriers,

or their affiliates who insure the Defendants .

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290. This action is also brought on behalf of a subclass of state and municipal pensio n

plans that purchased Pfizer common stock during the Class Period and that are bringing claims

under state law, as authorized by the provisions of the Securities Litigation Uniform Standard s

Act ("SLUSH"), 15 U.S .C. § 77v(a), (the "Subclass") .

291 . The members of the Class and Subclass are so numerous that joinder of al l

members is impracticable . As of the date of this Complaint, there were approximately 7 .37

billion shares of Pfizer common stock outstanding . While Plaintiffs do not know the exact

number of Class members, Plaintiffs believe that there are, at minimum, thousands of members

of the Class who purchased Pfizer common stock during the Class Period .

292. A class action is superior to other available methods for the fair and efficient

adjudication of this controversy .

293. Common questions of law and fact exist as to all members of the Class an d

Subclass, and predominate over any questions affecting, solely individual members of the Clas s

and Subclass . Among the questions of law and fact common to the Class and Subclass are :

a. Whether the federal securities laws were violated by the Defendants' acts as

alleged herein ;

b. Whether the SEC filings, and other public statements published an d

disseminated to the investing public and purchasers of the common stock during the Class Period

omitted and/or misrepresented material facts about the business affairs, financial condition and

present and future prospects of the Company ;

c. Whether the Defendants omitted to state and/or misrepresented material fact s

about the financial condition, profitability and present and future prospects of the Company ;

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d . With respect to Plaintiffs' claims under the Exchange Act, whether th e

Defendants acted willfully or recklessly in omitting to state and/or misrepresenting material facts

about the financial condition, profitability and present and future prospects of the Company ;

e . Whether the market price of Pfizer common stock during the Class Period wa s

artificially inflated due to the non-disclosures and/or misrepresentations complained of herein ;

and

f Whether the members of the Chss and Subclass have sustained damages, and ,

if so, what is the proper measure thereof .

294. Plaintiffs' claims are typical of the claims of the members of the Class . Plaintiffs

will fairly and adequately protect the interests of the members of the Class and have retaine d

counsel competent and experienced in class and securities litigation. Plaintiffs have no interests

that are adverse or antagonistic to the Class .

295 . Similarly, Lead Plaintiff's claims are typical of the claims of the members of th e

Subclass. Lead Plaintiff will fairly and adequately protect the interests of the members of th e

Subclass and have retained counsel competent and experienced in class and securities litigatio n

Lead Plaintiff has no interests that are adverse or antagonistic to the Subclass .

296. A class action is superior to other available methods for fair and efficient

adjudication of the controversy since joinder of all members of the Class (and Subclass) is

impracticable . Furthermore, the expense and burden of individual litigation make it impossible

for the C lass and Subclass members individually to redress the Defendants' wrongful conduct .

Furthermore, Lead Plaintiff knows of no difficulty which will be encountered in the management

of this litigation which would preclude its maintenance as a class action .

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COUNT ONE(VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT

AND RULE 10b-5(b) PROMULGATED THEREUNDER)

297. Plaintiffs repeat and reallege each and every allegation contained in the foregoing

paragraphs of this Complaint as if fully set forth herein . This claim is asserted against all of the

Defendants .

298. During the Class Period, the Defendants : (a) deceived the investing public,

including Plaintiffs, as alleged herein ; (b) artificially inflated and maintained the market prices of

Pfizer securities ; and (c) caused Plaintiffs to purchase or otherwise acquire Pfizer common stock

at artificially inflated prices .

299 . The Defendants made untrue statements of material fact and/or omitted to stat e

material facts necessary to make the statements made not misleading, and/or substantially

participated in the creation of the alleged misrepresentations, which operated as a fraud and

deceit upon Plaintiffs, in an effort to maintain artificially high market prices for Pfizer common

stock in violation of Section 10(b) of the Exchange Act and Rule 10b-5(b) . The Defendants

consistently made materially false and misleading statements and omitted to state material facts

regarding the cardiovascular dangers that Celebrex and Bextra posed during the Class Period,

thus materially misrepresenting Celebrex and Bextra's medical and commercial viability .

300. As a result of their making and/or their substantial participation in the creation of

affirmative statements and reports to the investing public, the Defendants had a duty to promptly

disseminate truthful information that would be material to investors in compliance with th e

integrated disclosure provisions of the SEC as embodied in SEC Regulation S-K (17 C .F .R. §

229.10, et seq .) and other SEC regulations, including accurate and truthful information with

respect to the Company's operations and performance so that the market prices of the

Company's publicly traded securities would be based on truthful, complete and accurat e

128

information . With regard to the efficacy and medical and commercial viability of Celebrex and

Bextra, the Defendants consistently failed to perform this duty .

301 . The Defendants, directly and indirectly, by use of the means and instrumentalities

of interstate commerce and/or the mails, made, or substantially participated in the creation of,

untrue statements of material facts and/or omitted to state material facts necessary in order to

make the statements made about the Company and/or Celebrex and Bextra in light of the

circumstances under which they were made, not misleading, as set forth herein .

302. The Defendants had actual knowledge of the misrepresentations and/or omissions

of material fact set forth herein, or acted with reckless disregard for the truth in that they failed to

ascertain and to disclose such facts, even though such facts were available to them .

303 . The facts alleged herein give rise to a strong inference that each of the Defendant s

acted with scienter . The Defendants' own internal information concerning Celebrex and Bextra

provided the Defendants with statistically significant information showing that Celebrex and

Bextra carried severe cardiovascular and thrombotic risks, such that the medical and commercial

viability of the drug, as well as the revenue stream associated with it, was consistently threatened

during the Class Period . The Defendants knew or recklessly disregarded that the financial results

publicly disseminated to investors during the Class Period were significantly driven by sales of

Celebrex and Bextra all over the world and that this material source of Company revenues

remained at risk because of the dangers that Celebrex and Bextra posed to people taking the

drug. The Defendants knew and/or recklessly disregarded the facts available to them during the

Class Period which indicated that Celebrex required a "black box" warning label and that Bextra

did not belong in the market .

304 . The Defendants carried out a deliberate scheme to protect the gigantic revenue

source that Celebrex and Bextra represented for Pfizer, and the Defendants knew that Celebre x

129

and Bextra's sales results would be incorporated into Pfizer's quarterly and annual financial

statements and publicly-disseminated reports to investors .

305 . In addition to having actual knowledge and/or recklessly disregarding the

fraudulent nature of their statements and conduct, each of the Defendants also had a strong

motive to engage in the fraudulent scheme set forth herein . Maintaining a strong stock price was

essential to Pfizer's ability to expand its markets as well as to maintain the artificially inflated

value of each of the Individual Defendants' holdings of Pfizer shares . Notwithstanding these

Defendants' knowledge that Celebrex and Bextra posed severe cardiovascular and thrombotic

risks to patients taking the drug, the Defendants knowingly and/or recklessly failed to disclose

such material risks. Disclosure of the true facts concerning Celebrex and Bextra would have

seriously impaired Pfizer's position in the pharmaceuticals marketplace . In addition, bonuses

available to the Individual Defendants were heavily dependent on meeting the ever growing

financial targets set by Pfizer .

306 . As a result of the dissemination of the materially false and misleading informatio n

and failure to disclose material facts, as set forth above, the market price of Pfizer's common

stock was artificially inflated throughout the Class Period. Unaware that the market price of

Pfizer common stock was artificially inflated, and relying directly or indirectly on the false and

misleading statements made by the Defendants, or upon the integrity of the market in which

Pfizer common stock traded, and the truth of any representations made to appropriate agencies

and to the investing public, at the times at which any statements were made, and/or in the

absence of material adverse information that was known or with deliberate recklessness

disregarded by the Defendants but not disclosed in public statements by the Defendants,

Plaintiffs purchased or acquired Pfizer's common stock at artificially high prices and were

damaged when the truth was revealed over time .

130

307 . At the time of said misrepresentations and omissions , Plaintiffs were ignorant of

their falsity, and believed the false statements to be true . Had Plaintiffs known that Celebrex and

Bextra presented such severe cardiovascular and thrombotic risks, facts which wer e

misrepresented and/or not disclosed by the Defendants , Plaintiffs would not have purchased

Pfizer common stock at all or, would not have done so at the a rt ificially inflated prices that they

paid .

308 . The Defendants' materially false and misleading statements and omissions o f

material fact caused Plaintiffs to suffer losses in connection with their investments in Pfizer

common stock. Pfizer's stock price collapsed as the truth was revealed over time regarding the

medical and commercial viability of Celebrex and Bextra. By October 20, 2005, the disclosure

ofPfzer's Celebrex and Bextra-related fraud reduced the share price by more than $21 per share

and caused a loss of market capitalization of more than $111 billion .

309. By reason of the foregoing, the Defendants violated Section 10(b) of the

Exchange Act and Rule I0b-5(b) promulgated thereunder, and are liable to Plaintiffs for

damages suffered in connection with purchases of Pfizer common stock during the Class Period .

COUNT TWO(VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT AND RULE

10b-5 (a) AND (c) PROMULGATED THEREUNDER)

310 . Plaintiffs repeat and reallege each and every allegation contained in each of the

foregoing paragraphs of this Complaint as if fully set forth herein . This claim is asserted against

all of the Defendants .

311 . This Count is brought solely and exclusively under the provisions of Rule 1Ob-

5(a) and (c) . Accordingly, Plaintiffs need not allege in this Count nor prove in this case that any

of the Defendants made any misrepresentations or omissions of material fact for which they may

also be liable under Rule lOb-5(b) and/or any other provisions of law .

131

312. During the Class Period, the Defendants carried out a common plan, scheme, and

unlawful course of conduct that was intended to and did : (i) deceive the investing public,

including Plaintiffs ; (ii) artificially inflate the market prices of Pfizer common stock : and (iii)

cause Plaintiffs to purchase Pfizer common stock at artificially inflated prices .

313. In furtherance of this unlawful plan, scheme and course of conduct, th e

Defendants employed devices, schemes and a rt ifices to defraud and knowingly and/or recklessly

engaged in acts, transactions , practices , and courses of business that operated as a fraud and

deceit upon Plaintiffs in connection with purchases of Pfizer common stock, in violation of

Section 10 (b) of the Exchange Act and Rule I Ob-5(a ) and (c) promulgated thereunder.

314 . The Defendants ' fraudulent devices, schemes, arti fices and deceptive acts ,

practices, and course of business included the knowing and/or reckless suppression and

concealment of information regarding Celebrex and Bextra's dangers and the corresponding

continuing threat to Celebrex and Bextra's medical and commercial viability during the Class

Period . The Defendants knowingly suppressed and concealed such information to distort the

balance of facts available to Pfizer's investors that would be included in the Company's financial

statements disseminated to investors during the Class Period .

315 . Plaintiffs reasonably relied upon the integrity of the market in which Pfizer's

common stock traded .

316. During the Class Period, Plaintiffs were unaware of the Defendants' fraudulent

scheme and unlawful course of conduct . Had Plaintiffs known of the Defendants' unlawful

scheme and unlawful course of conduct, they would not have purchased Pfizer common stock or

if they had, they would not have purchased such common stock at the artificially inflated prices

paid for such common stock .

132

317, As a direct and proximate result of the Defendants' scheme to defraud and such

unlawful course of conduct, Plaintiffs suffered damages in connection with purchases of Pfizer

common stock during the Class Period .

318. By reason of the foregoing, the Defendants violated Section 10(b) of the

Exchange Act and Rule I Ob-5(a) and (c) promulgated thereunder and are liable to Plaintiffs for

damages suffered in connection with purchases of Pfizer common stock during the Class Period .

COUNT THREE(VIOLATION OF SECTION 20(a) OF THE EXCHANGE ACT )

319. Plaintiffs repeat and reallege each and every allegation contained in the foregoing

paragraphs of this Complaint as if fully set forth herein . This claim is asserted against

Defendants McKinnell, LaMattina and Katen (the "Control Defendants") .

320. The Control Defendants acted as controlling persons of Pfizer within the meanin g

of Section 20(a) of the Exchange Act, as alleged herein . By virtue of their respective high- level

positions and active participation in and/or awareness of the day-to-day operations at Pfizer, each

of the Control Defendants had the power to influence and control and did influence and control,

directly or indirectly, the decision- making of the Company, including the content an d

dissemination of the various public statements and SEC filings that Lead Plaintiff alleges were

false and misleading. The Control Defendants were provided with, or had unlimited access to,

copies of reports, clinical studies, press releases, public filings and other statements alleged

herein to be misleading prior to and/or shortly after these statements were issued and had the

ability to prevent the issuance of the statements or to cause the statements to be corrected .

321 . In particular, the Control Defendants had direct and supervisory involvement in

the day-to-day operations of the Company, and, therefore, are presumed to have had the power to

control or influence the particular transactions giving rise to the securities violations as alleged

herein, and exercised the same .

133

322 . As set forth in the preceding paragraphs of this Complaint, Pfizer and th e

Individual Defendants violated Section 10(b) of the Exchange Act and Rules 10b-5(a), 10b-5(b) ,

and 10b-5(c) promulgated thereunder and Section 18 of the Exchange Act .

323. By virtue of their positions as controlling persons, the Individual Defendants

named as Control Defendants in this Count are liable pursuant to Section 20(a) of the Exchange

Act. As a direct and proximate result of their wrongful conduct, Plaintiffs suffered damages i n

connection with purchases of Pfizer common stock during the Class Period .

COUNT FOUR(COMMON LAW FRAUD ON BEHALF OF THE SUBCLASS )

324. Lead Plaintiff incorporates herein by reference and realleges each and ever y

allegation contained in the preceding paragraphs of this Complaint as if fully set forth herein .

325. This cause of action is asserted by Lead Plaintiff on behalf of itself and th e

Subclass against the Defendants, based on common law principles of fraud, deceit an d

conspiracy .

326. As alleged herein, each of the Defendants made material misrepresentations, o r

omitted to disclose material facts, to Lead Plaintiff and the Subclass regarding Celebrex and

Bextra's commercial and medical viability .

327 . In addition, the Defendants each conspired with each other for the purpose of

misleading Lead Plaintiff and the Subclass regarding Pfizer's financial condition, and eac h

committed overt acts, including the making of false and misleading statements, in furtherance o f

such conspiracy .

328. The aforesaid misrepresentations and omissions by the Defendants were made

intentionally, or at a minimum recklessly, to induce reliance thereon by Lead Plaintiff and the

Subclass when making investment decisions .

134

329. The aforesaid misrepresentations and omissions by the Defendants constitute

fraud and deceit .

330. The aforesaid conduct by the Defendants also constitutes conspiracy to commit

fraud and deceit .

331 . Lead Plaintiff, the Subclass and/or their agents reasonably relied on the

Defendants' representations when deciding to purchase Pfizer's common stock .

332. At the time Pfizer's common stock was purchased by Lead Plaintiff and th e

Subclass, Lead Plaintiff and the Subclass did not know of any of the false and/or misleadin g

statements and omissions .

333 . As a direct and proximate result of the fraud and deceit of the Defendants, Lea d

Plaintiff and the Subclass suffered damages in connection with their purchases of Pfizer' s

common stock .

COUNT FIVE(STATE SECURITIES LAWS VIOLATIONS AGAINST ALL DEFENDANTS

ON BEHALF OF LEAD PLAINTIFF AND THE SUBCLASS )

334. Lead Plaintiff repeats and realle;es each and every allegation contained above a s

if fully set forth herein .

335 . This Count is brought pursuant to those state securities laws that have a privat e

right of action of each of the states in which the members of the Subclass are located.

336. As set forth above, the Defendants, and each of them, made or caused to be made

statements in applications, reports and documents that were filed with the SEC and/or otherwis e

disseminated to the public, which were, at the time and in light of the circumstances under which

they were made, false or misleading with respect to material facts .

337. Lead Plaintiff and the Subclass read and relied upon the Defendants' publi c

statements in deciding to purchase Pfizer common stock.

135

338. Lead Plaintiff and the Subclass relied upon the statements contained in the reports

and documents set forth above not knowing that such statements were false and misleading .

339. The statements contained in such reports, as set forth above, were materially false

and misleading because the Defendants knew or had access to the materially adverse non-publi c

information about the commercial and medical viability of Celebrex and Bextra .

340 . The Defendants ' conduct in making or causing to be made false and misleading

statements resulted in the Company falsely reporting its financial condition.

341 . In connection with the purchase of Pfizer common stock, the Lead Plaintiff an d

the Subclass and their agents had a right to rely and did reasonably rely upon the false an d

misleading statements of the Defendants regarding the financial statements and/or financia l

condition and performance of Pfizer .

342. The material misstatements and falsehoods by the Defendants , all of which are

detailed above, had the direct effect of artificially inflating the price of Pfizer's stock, and Lea d

Plaintiff and the Subclass and their agents relied on those material misstatements in purchasin g

P fizer stock at such artificially inflated prices .

343 . When the truth was finally revealed, Lead Plaintiff and the Subclass wer e

significantly damaged by the resulting precipitous drop in the stock's trading price .

344 . The Defendants directly and indirectly, with scienter and/or recklessly, i n

connection with the sale of Pfizer common stock, made untrue statements of material fact and/o r

omitted to state material facts necessary in order to make the statements made, in the light of th e

circumstances under which they are made, not misleading.

345. As a direct and proximate result of the Defendants' wrongful conduct, Lead

Plaintiff and the Subclass suffered damage s in connection with their purchases of Pfizer commo n

stock .

136

346. By reason of the foregoing, the Defendants proximately caused Lead Plaintiff and

the Subclass damages .

COUNT SIX(VIOLATION OF SECTION 18 OF THE EXCHANGE ACT )

347 . Plaintiffs repeat and reallege each and every allegation contained in the foregoing

paragraphs of this Complaint as if fully set forth herein . This claim is asserted against

Defendants McKinnell, LaMattina and Katen .

348. During the Class Period, the Defendants named in this Count : (a) deceived the

investing public, including Plaintiffs, as alleged herein ; (b) artificially inflated and maintained

the market prices of Pfizer securities ; and (c) caused Plaintiffs to purchase or otherwise acquire

Pfizer securities at artificially inflated prices .

349. In numerous filings with the SEC, the Defendants made untrue statements o f

material fact and/or omitted to state material facts necessary to make the statements made not

misleading, and/or substantially participated in the creation of the alleged misrepresentations,

which operated as a fraud and deceit upon Plaintiffs, in an effort to maintain artificially high

market prices for Pfizer common stock . The Defendants consistently made materially false and

misleading statements and omitted to state material facts regarding the cardiovascular dangers

that Celebrex and Bextra posed during the Class Period, thus materially misrepresenting

Celebrex and Bextra's medical and commercial viability .

350. As a result of their making and/or their substantial participation in the creation of

affirmative statements and reports to the investing public, the Defendants had a duty to promptly

disseminate truthful information that would be material to investors in compliance with the

integrated disclosure provisions of the SEC as embodied in SEC Regulation S-K (17 C .F.R .

§ 229 .10, et seq .) and other SEC regulations, including accurate and truthful information with

respect to the Company's operations and performance so that the market prices of the

137

Company's publicly traded securities would be based on truthful, complete and accurate

information . With regard to the efficacy and medical and commercial viability of Celebrex an d

Bextra, the Defendants failed to perform this duty .

351 . The Defendants, directly and indirectly, by use of the means and instrumentalitie s

of interstate commerce and/or the mails , made or substantially participated in the creation o f

untrue statements of material facts and/or omitted to state material facts necessary in order t o

make the statements made about the Company and/or Celebrex and/or Bextra in light of the

circumstances under which they were made not misleading, as set forth herein .

352 . Relying directly on the false and misleading statements made by the Defendants

in SEC filings, Plaintiffs purchased or acquired Pfizer 's securities at artificially high prices and

were damaged thereby.

353 . At the time of said misrepresentations and omissions in Pfizer's SEC filings ,

Plaintiffs were ignorant of their falsity and believed the false statements to be true . Had

Plaintiffs known that Celebrex and Bextra presented such severe cardiovascular and thromboti c

risks, facts which were misrepresented and/or not disclosed by the Defendants in their SE C

filings, Plaintiffs would not have purchased such securities or, if they had purchased suc h

securities, they would not have done so at the artificially inflated prices that they paid .

354 . The Defendants ' materially false and misleading statements and omissions o f

material fact in Pfizer's SEC filings caused Plaintiffs to suffer losses in connection with thei r

investments in P fizer securities .

355. By reason of the foregoing, the Defendants violated Section 18 of the Exchang e

Act and are liable to Plaintiffs for damages that they suffered in connection with their purchase s

of Pfizer common stock during the Class Period .

138

COUNT SEVEN(VIOLATION OF SECTION 20A OF THE EXCHANGE ACT )

356 . Plaintiffs repeat and reallege each and every allegation contained above as if fully

set forth herein .

357. This Claim is asserted against Defendants McKinnell, LaMattina and Katen (the

"Section 20A Defendants"), and is based upon Section 20A of the Exchange Act, 15 U.S.C . §

78t-1, in connection with their insider trading in Pfizer common stock .

358. Defendant McKinnell engaged in the following sales of Pfizer common stoc k

during the Class Period selling almost 809,134 of the shares he held, reaping $29,755,919 i n

proceeds . The shares sold by McKinnell during this period represented 14 .40% of the shares of

Pfizer stock he owned .

Date of Number Price per % MonthlyDisposition Share

Proceeds HoldingsHoldings Sold

disposed Of

10/26/2000 180,000 $45 .3 $8,149,40 560,69 24.30°/

10/23/2001 302,05 $42.61 $12,870,43 715,081 29.70°/

02/27/2003 3,59 $29.3 $105,50 1,084,60 0 .33°/

02/25/2004 15,72 $37.2 $584,97 1,149,08 1 .35°/

08/16/2005 307,76 $26.11 $8,035,61 1,580,27 16 .30°/

Average is :Total 809,134 , S29,755,9 1 14.400/

359. Defendant Katen engaged in the following sales of Pfizer common stock durin g

the Class Period selling almost 372,536 of the shares she held, reaping $13 .2 million in proceeds .

The shares sold by Katen during this period represented 7.44% of the shares of Pfizer stock sh e

owned .

139

Date ofDisposition

# SharesDisposed Of

Price perShare

Proceeds Holdings % MonthlyHoldings Sold

08/18/2000 36,000 $42.71 $1,537,560 365,009 8.98%

11/06/2000 36,000 $44.01 $1,584,360

10/19/2001 84,960 $42.00 $3,568,320 436,393 16.30%

02/21/200202/25/2002

6,0981 .1927,290

$41 .03$40.98

$250,20 1$48,84 8

02/27/2003 2,157 $29.33 $63,265 635,040 0.34%

11/182003 64,800 $34.37 $2,227,176 639,678

02/26/2004 16,049 $37.15 $596,220 666,097 2.52%

02/24/2005 58,135 $26.20 $1,523,137 811,879 6.68%

05/10/2005 8,045 $27 .790 $223,571 807,878 .99%

05/10/2005 59,100 $27.780 $1,641,798 748,778 7 .32%

Class Perio dTotals 372 ,536 $13,264 ,107

Average is :7.44%

360. Defendant LaMattina engaged in the following sales of Pfizer common stoc k

during the Class Period selling almost 67,073 of the shares he held, reaping $1 .8 million in

proceeds . The shares sold by LaMattina during this period represented 6 .08% of the shares o f

Pfizer stock he owned.

Date ofDisposition

# SharesDisposed Of

Price perShare

Proceeds Holdings % MonthlyHoldings Sold

02/24/2005 21,651 $26.200 $567,256 367,381 5 .57%

02/26/2004 5,633 $37.15 $209,266 293,488 1 .88%

05/06/2005 39,789 $27.820 $1,106,930 329,302 10.78%

Class PeriodTotals

67 ,073 $1,883,452Average is :

6 .08%

140

361 . The Section 20A Defendants collectively sold more than 1,248,743 shares o f

Pfizer common stock , reaping total proceeds in excess of $44.9 million .

362. The Section 20A Defendants knowingly or with deliberate recklessness sold thei r

Pfizer common stock during the Class Period while in possession of material, adverse, non-

public information. As set forth in Exhibit A, attached hereto, contemporaneously with sales o f

Pfizer stock by these Defendants, Plaintiffs purchased Pfizer common stock sold by these

Defendants .

363. By reason of Plaintiffs' purchases of Pfizer stock contemporaneously with certai n

of the Defendants' sales of stock, Plaintiffs suffered recoverable damages . Under Section 20A of

the Exchange Act, the Section 20A Defendants are liable to Plaintiffs for all profits gained and

losses avoided by them as a result of these contemporaneous transactions .

XVI. PRAYER FOR RELIEF

WHEREFORE, Plaintiffs pray for relief and judgment, as follows :

A. Declaring this action to be a proper Class action pursuant to Fed . R. Civ .

P. 23 ;

B. Awarding compensatory damages against all of the Defendants, jointl y

and severally, in favor of Plaintiffs for all losses and damages suffered as a result of th e

Defendants' wrongdoing alleged herein, in an amount to be determined at trial, together wit h

interest thereon ;

C. Awarding Plaintiffs their reasonable costs and expenses incurred in thi s

action , including a reasonable allowance of fees for Plaintiffs' attorneys and experts ; and

D. Awarding Plaintiffs such other and further relief as the Court may dee m

just and proper .

141

XVII. JURY DEMAND

Plaintiffs demand a trial by jury as to all issues so triable .

Dated : February 16, 2006GRANT & EISENHOFER P .A.

By: _ 6` WJay W . i enhofer (JE 5503 )

James R . Banko (.1'&9686)Diane Zilka (DZ-9452)45 Rockefeller Center, 15`x' Floor630 Fifth AvenueNew York, NY 10111Telephone : (212) 755-6501Facsim ile : (212) 307-3216

and

Geoffrey C . JarvisSteve GrygielBrian M . RostockiChase Manhattan Centre1201 North Market StreetWilmington, DE 19801Telephone : (302) 622-7000Facsimile : (302) 622-7100

Attorneysfor Lead Plaintiff The Teachers'Retirement System of Louisian a

OF COUNSEL :

Richard S . SchifirinDavid KesslerAndrew L. ZivitzBenjamin J . SweetMichelle M. BackesSCI-IIFFRIN & I3ARROWAY, LLP280 King of Prussia Roa dRadnor, PA 19087Telephone: (610) 822-2229Facsimile : (610) 667-705 6

Attorneys for Michael Feitler,Christine Fleckles, and Paul Schapka

142

SCHEDULE A

Schedule ATeachers' Retirement System of Louisian a

Pfizer, Inc . Common Stock Transactions : October 31, 2000 - October 19, 2005

..___~_ - --- ---- -Purcfilases----------- ----------- --- ------ - --Safes --------__-M . .. . ------___-----

Trade Date Shares Price Total Trade Date Shares Price Total

10131/00 Balance 687 .52 5

11120100 40,000 543 .3125 $1,732,500.0 012/19!00 20,000 $47 .3750 $947,500.0 0

1130101 3,200 543 .9334 5140,586 .8 86119101 48,000 $43 .0846 $2,068,060 .8 06119101 20,000 $43.3900 $867,800,0 06127101 20,000 $42 .2700 $845,400 .0 0

10129101 135,300 $42 .8728 $5,800,669.8 412/18/01 108,000 $41 .1241 $4,441,402 .8 0121 19101 38.000 841 .2248 $1,566,542 .4 02114102 32,000 $40.9200 $1,309,440 .0 04112/02 28,000 $39.0393 $1,093,100 .4 07/26102 23,000 $28 .3200 5651,360 .0 08119102 21,900 $33.6000 $735,840,0 08119102 9,600 $33 .9416 $325,839 .3 68119102 287,800 $33 .9554 $9,772,364 .1 28121102 9,600 $33.8000 $324,480 .008127102 59,000 $34.6949 .$2,046,999 .1 08128102 5,000 532.9422 $164,711 .0 09!12102 6,500 530.1100 $185,715 .0 0

10121/02 35,000 532 .3300 $1,131,550 .00112/03 1,800 $30.9450 $55,701 .00217103 16,000 $29.0803 $$465,284 .80

4123103 33,958 531 .1500 $1,058,103 .2 05113103 45,000 533 .4000 $1,503,000 .0 05121103 25,000 $31 .3280 $783,200,006!23103 27,700 $35 .5300 $984,181 .00

718103 35,000 $34.4420 $1,205,470 .009!16103 10,000 $31 .9500 $319,500.009/22103 20,800 $ 31 .2000 5648 .960 .009122103 30,000 831 .1400 $934,200.0 09/22/03 72,300 $31 .1536 $2,252,405 .2 81013103 20,000 $30 .9775 $619,550 .0 0

10!30103 10,000 530 .9200 $309,200 .0012003 117,800 834 .0855 84,015,271 .9 0

1 2122/03 300 534 .4500 $10,335 .0 0115104 36,000 $36 .5300 $1,315,080 .0 0

2113104 400 537 .3400 $14,936 .0 03004 11,000 536 .8700 $405,570 .0 0315104 141,600 $37 .3700 $5,291,592 .0 0

3117104 15,600 $34 .9400 $545,064 .0 03118104 22,600 $34 .5200 $780,152 .0 0

513104 80,900 $36 .0042 $2,912,739 .785114104 148,100 $35 .4000 $5,242,740 .0 05119104 71,700 $35 .3118 52,531,856 .06

613104 103,000 835 .9866 $3,706,619,8 06110104 4,700 535 .7900 $168,213 .0 06110/04 700 $35.8000 $25,060 .006110104 5,900 $35.7800 $211,102 .006125104 31,600 5318175 51,068,633.007116104 10,200 $32.2500 $328,950.009124104 8,200 $29,7700 5244,114,0 01017104 56,500 $29.8000 $1,743,300.0 01017104 8,800 $29.2500 $257,400.0 01017104 1,100 $29.8573 $32,843.03

12/15!00 26,400 $45 .6056 $1,203,987 .8 412/15/00 34,000 $45 .4375 $1,544,875 .0 012 119100 4,200 $47 .5625 $199,762 .5 0

3121101 7,500 536 .7000 5275,250 .0 0512101 60,000 $43 .0625 $2,583,750 .00

9127101 10,700 $39 .0477 $417,810 .3 92113102 8,200 $41 .1600 $337,512 .006118102 135,300 536 .1095 $4,885,615 .3 58120102 58,225 534 .0700 51,983 .725 .7 58126102 1,600 533 .9700 $54,352 .009122103 68 $31 .2600 $2,125 .68

12119/03 64,600 $34 .1024 $2,203,015 .0 44121104 15,900 $37 .0400 $588,936.006117104 40,400 535 .1328 $1,419,365 .1 26!21104 44,400 835 .4000 51,571,760.006128104 1,200 $34 .1450 840,974 .001113104 26,500 529 .9800 $794,470.00

114105 101,000 526 .3153 $2,657,845.301/5/05 53,000 826 .4600 51,402,380.00

1111105 40,300 526 .1200 $1,052,636.0 0217105 372,900 524 .9007 $9,285,471 .0 3

3116105 51,000 $26 .1575 51,334 .032 .503/17105 40,000 $25 .9977 $1,039,908.0 03!22105 158,900 525 .7050 54,084,524 .50

417105 45,000 $26 .5022 $1,192,599.0 05119/05 101,000 $28.4700 $2.875,470 .0 06124105 551,900 $28 .5270 $15,744,051 .306124105 151,367 $28.5200 $4,316,986 .8 46/29105 97,300 827 .8710 $2,711,848 .30

716105 247,900 $26 .8155 $6,647,562 .4 5811105 84,300 $26.6228 52 .244,302 .0 4

8118105 55,000 526.0045 $1,430,247 .5 010110/05 20,000 $24 .4163 5488,326 .0 010117/05 23,500 524 .1900 $568,46500

_ . ._._ . ._.^.. ... . . . . . .... . Purchases -------- - --- - -------- - . ._ --------------------------Sales -------------------------------

Trade Date Shares Price Total Trade Date Shares Price Tot a

1114104 20,000 $28 .3700 $567,400 .0011!4104 25,800 $28.3700 $731,946.0 01114104 1,900 $28 .6284 $54,393 .9 61218104 30,500 $27 .4420 $836,981 .0 01219104 3,000 $27 .4200 $82,260 .0 0

12!17104 47,100 $24,9500 $1,175,145 .0 012121104 101,900 $24 .9900 $2,546,481 .0 0

117105 158,900 $26 .5006 $4,210,945 .3 41111105 2,600 $26 .1200 $67,912 .0 06124105 523,600 525,5130 $14,929,406 .8 0

715105 184,000 $27,0792 $4,982,572 .8 0717105 10,000 $26 .5000 $265,000.0 0

7!19105 150,000 $27 .4367 $4,115,505 .00811 105 58,700 $26.6732 $1,565,716 .84813105 100,000 $26.7192 $2,671,920.00

9114105 3,200 $25.9850 $63,152.0 09120105 35,300 525 .6070 $903,927.1 09130105 53,200 524 .9733 $1,328,579 .5 6

10!18105 63,500 $24 .1656 51,534,515 .60

SCHEDULE B

CERTIFICATION OF NAMED PLAINTIFFPURSUANT TO FEDERAL SECURITIES LAW S

[, (print name ) / ~ Y ~~~i° `> (" Plaintiff') declare, as to the claims asserted under the federa l

securities laws, that :

Plaintiff has reviewed the Complaint and authorizes its filing .

2. Plaintiff did not purchase the security that is the subject of this action at the direction of Plaintiff's counsel or in order to

participate in any private action ,

3 . Plaintiff is willing to serve as a representative parry on behalf of the class, including providing testimony at deposition an d

trial, if necessary.

4 . Plaintiffs transaction( s) in the Pfizer, Inc. (NYSE: PFE) security that is the subject of this action during the Class Period

is/arc as follows' :

No. of Shares Buv/Sell Date Price Per Share

too d3 2 2! l7 Z' e2

' List additional transactions an a separate sheet of paper, if necessary .

5 . Plaintiff has complete authori ty to bring a suit to recover for investment losses .

6. During the three years p ri or to the date of this Certi fi cation, Plaintiff has sought to serve or served as a representative partyell

or a class in the following actions fi led under the federal securities laws (if none , so indicate) : &1d

Plaintiff will not accept any payment for serving as a representative parry on behalf of the class beyond the Plaintiffs pro

rata share of any recovery, except such reasonable costs and expenses (including lost wages) directly relating to the representation of the clas s

as ordered or approved by the Court.

I declare under penalty of pctju ry that the foregoing is true and correct

Executed this j D day of F A , 2o0.(

n um

)k,11 C /cz i ~ritC.~Print Name

CERTIFICAT ION OF NAMED PLAINTIFFPURSUANT TO FEDERAL SECURITIES LAW S

t, (print name ) t 5 1 • ►~ ~{ ~J ("Plainti ff') declare, as to the claims asserted under the federal

securities laws, that :

1 . Plaintiff has reviewed the Complaint and authorizes its filing-

2 . Plaintiff did not purchase the security that is the subject of this action at the direction of Plaintiffs counsel or in order to

participate in any private action-

Plaintiff is willing to serve as a representative party on behalf ofthe class, including providing testimony at deposition and

trial, if necessary.

4 . Plaintiffs transaction(s) in the Pfizer, Inc. (NYSE : PFE) security that is the subject of this action during the Class Perio d

is/are as follows`:

No. of Shares Buy/Sell Date Price Per Share

flv u/60 Bu !a zt ~uov 4~5~ /5_ U lE r

u q040 3'List additional transactions on a separate sheet of paper, it necessary .

5. Plaintiffhas complete authority to bring a suit to recover for investment losses .

6. During the three years prior to the date of this Ce rtification, Plaintiff has sought to serve or served as a representative party

or a class in the following actions filed under the federal securities laws (if none, so indicate) : N O N. G

7. Plaintiff will not accept any payment for serving as a representative pa rty on behalf of the class beyond the Plaintiff's pro

rata share of any recovery, except such reasonable costs and expenses (including lost wages ) directly relating to the representation of the class

as ordered or approved by the Court.

I declare under penalty of perjury that the foregoing is true and correct .

Executed this JJ day of J A Nt4AL1 z4U~7~.

Signature

Print Name

CERTIFICATION OF NAMED PLAINTIFFPURSUANT TO DERiL SECURITIES LAWS

1, (print name ) ti 1 sC h k , A ("Plaintiff") declare, as to the claims asserts , under the federal

securities laws, that:

1 . Piaintlff has reviewed the Complaint and authorizes its filing.

2 . Plaintiff did not purcbase the security that is the subject of this action at the direction of Plaintiffs counsel or in order to

participate in any private action. .

3 . Plaintiff is willing to serve as a representative party on behalf of the class, including providing testimony at deposition an d

trial, if necessary ,

4 . Plaintiffs transaction(s) in the Pfizer, Inc. (NYSE : PFE) security that is the subject of this action during the Class Perio d

istare as follows' :

No. of Shares BuylSeEt Date Price Per Share

Q 44a G 11 ;X660V.2

'List additional transactions on a separate sheet of paper, if necessary .

5 . Plaintiff has complete authority to bring a suit to recover for investment losses .-

6. During the three years prior to the date of this Certification , Plaintiff has sought to serve or served as a representative party

or a class in the following actions filed under the federal securities laws (i f none, so indicate) :T

7 . Plaintiff will not accept any payment for serving as a representative party on behalfof the class beyond the Plainti ff s pro

rata, share of any recovery , except such reasonable costs and expenses ( including lost wages ) directly relating to the representation of the class

as ordered or approved by the Court .

I declare under penalty of perj ury that the foregoing is true and correct .

Executed this J day of -,A 9/ 200

Si~naturc

'AVc~ CRA?k APrint Name

EXHIBIT A

PartyTradeDate

SharesSold

SharesPurchased

Sale PricePurchasePrice pe r

Share

Total SaleValue

Tota l

PurchaseValue

MCKINNELL, HENRY A. 10126/2000 180,000 $45 .3300 $8,159,400 .00

Fleckles, Christine (Plaintiff) 10/26/2000 100 $44 .3125 $4,431 .2 5

Fleckles, Christine (Plaintiff) 1111/2000 50 $43 .3750 $2,168.75

KATEN, KAREN L . 11 1612000 36,000 $44 .0100 $1,584,360 .00

Scha ka, Paul (Plaintiff) 11/612000 200 $44 .5000 $8,900.0 0

MCKINNELL, HENRY A. 10123/2001 302,052 542 .6100 $12,870,435 .72

TRSL 10/29/2001 135,300 $42 .8728 $5,800,689 .8 4

KATEN, KAREN L . 2/21/2002 7,290 540,9800 $298,744 .20

Feitler, Michael (Plaintiff) 2/2112002 100 $41 .4000 $4,140.00

MCKINNELL, HENRY A . 2/25/2004 15,725 $37 .2000 $584,970 .00

KATEN, KAREN L . 2/26/2004 16,049 $37 .1500 $596,220 .3 5

LAMATTINA, JOHN L . 2126/2004 5,633 537 .1500 $209,265 .9 5

TR S L 3/2/2004 11,000 $36 .8700 $405,570 .0 0

Total 562,749 146,750 $24,303,396 .22 $6,225,899 .84

UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF NEW YORK

In re Pfizer Inc. Securities Litigation C.A. No. 04 Civ . 9866 (RO)

CERTIFICATE OF SERVIC E

1 hereby certify that true and correct copies of the attached CONSOLIDATED CLASSACTION COMPLAINT were served via U .S. Mail on the 16`x' day of February, 2006 . on thepersons listed below :

Frederick Taylor lsquith, Sr., Esq .Mark C. Rifkin, Esq .WOLF HALDENSTEIN ADLER

FREEMAN & HERZ LL P270 Madison AvenueNew York, NY 10016

John G . Emerson, Jr ., Esq .Scott E. Poynter, Esq .Elizabeth Watson, Esq .EMERSON POYNTER LLP2228 Cottandale Lane, Suite 100Little Rock, AK 72202

Donald J . Enright, Esq .Michael G . McLellan, Esq .FINKELSTEIN, THOMPSO N

& LOUGHRAN1050 30`x' Street, NWWashington, DC 20007

Eric J . Belfi, Esq .Aaron Daniel Patton, Esq.MURRAY, FRANK & SAILER LLP275 Madison Avenue, Suite 80 134x' FloorNew York, NY 1001 6

Jack G . Fruchter, Esq .ABRAHAM FRUCHTER &

TWERSKY, LLPOne Pennsylvania Plaza, Suite 2805New York, New York 1011 9

Marc A. Topaz, Esq .Richard A . Maniskas, Esq .Tamara Skivirsky, Esq .SCHIFFRIN & BARROWAY, LLP280 King of Prussia Roa dRadnor, PA 19087

Samuel 1-I . Rudman, Esq .David A . Rosenfeld, Esq .LERACH COUGHLIN STOI A

GELLER RUDMAN & ROBBINS LLP200 Broadhollow RoadMelville, NY 117€7

William S . Lerach, Esq .Darren J . Robbins, Esq .Arthur C . Leahy, Esq .LERACH COUGHLIN STOIAGELLER RUDMAN & ROBBINS LLP

401 B Street , Suite 170 0San Diego, CA 9210 1

Thomas McKenna, Esq .GAINEY & MCKENNA485 5 " ' AvenueNew York, NY 10007

Eric J . Bela, Esq .Paul T . Curley, Esq .MURRAY, FRANK & SAILER LLP275 Madison Avenu e, Suite 80 1301 Floo rNew York, NY 10016

David B . Kahn, Esq. Russell A, Ingebritson, Esq.DAVID B. KAHN & ASSOCIATES, LTD. TNGEBRITSON & ASSOCIATES, P.A .One Northfield Plaza 100 South Fifth Street, Suite 45 0Suite 100 Minneapolis, MN 55402Northfield, IL 6009 3

Richard A. Lockridge, Esq_Karen Hanson Riebel, Esq .LOCKRIDGE GRINDAL NAUEN P.L.L.P.100 Washington, Avenue South, Suite 2200Minneapolis, MN 55401

Sherrie R. Savett, Esq .Barbara A. Podell, Esq .Phyllis M . Parker, Esq .BERGER & MONTAGUE, P .C .1622 Locust Stree tPhiladelphia, PA 1910 3

Stanley M . Grossman, Esq .Mare I . Gross, Esq .H. Adam Prussin, Esq .POMERANTZ HAUDEK BLOCKGROSSMAN & GROSS, LLP100 Park Avenue , 26th FloorNew York, NY 1001 7

Alfred G . Yates, Jr., Esq .Gerald L. Rutledge, Esq .LAW OFFICE OF ALFRED G.YATES JR., PC519 Allegheny Building429 Forbes AvenuePittsburgh, PA 1521 9

David R. ScottSCOTT & SCOTT108 Norwich AvenueColchester, CT 06415

Donald J. Enright, Esq .Michael G . McLellan, Esq .FINKELSTEIN, THOMPSON

& LOUGHRAN1050 30 11 Street, NWWashington, DC 2000 7

Frederick Taylor Isquith, Sr ., Esq .Gregory M . Nespole, Esq.Christopher S . Hinton, Esq .WOLF HALDENSTEIN ADLERFREEMAN & HE, RZ LLP270 Madison AvenueNew York, NY 100 1 6

Curtis Victor Trinko, Esq.Jeffrey B . Silverstein, Esq .LAW OFFICES OF CURTIS V.TRINKO, LLP16 West 46th Street, Seventh FloorNew Yorlc, NY 1003 6

Greg Markel, Esq .Jason Halper, Esq_Tom M. Fini, Esq .CADWALADER, WICKE, RSHAM

& TAFT LLPOne World Financial CenterNew York, NY 1028 1

. Dwx~~ 6 ot4vtt-.Tarns R . Banko (.TB-9686)

GRANT & EISENHOFER P.A. Jay W. Eisenhofer (JE 5503)...

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