Good day, everyone and welcome to Pfizer's First Quarter 2014 Earnings Conference Call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Chuck Triano, Senior Vice President of Investor Relations. Please go ahead, sir..

Thank you, operator. Good morning and thank you for joining us today to review Pfizer's first quarter 2014 performance.

I am joined today in New York by our Chairman and CEO, Ian Read; Frank D'Amelio, our CFO; Mikael Dolsten, President of Worldwide Research and Development; Albert Bourla, President of Vaccines, Oncology and Consumer; Geno Germano, President of Global Innovative Pharma; John Young, President of Established Pharma and Doug Lankler, General Counsel.

The slides that will be presented on this call can be viewed on our home page pfizer.com, by clicking on the link for Pfizer Quarterly Corporate Performance First Quarter 2014 located in the Investor Presentations section in the lower right hand corner of this page.

Before we start, I would like to remind you that our discussions during this conference call will include forward-looking statements and that actual results could differ materially from those projected in the forward-looking statements.

The factors that could cause actual results to differ are discussed in Pfizer's 2013 Annual Report on Form 10-K and in our reports on Forms 10-Q and 8-K. Discussions during this call will also include certain financial measures that were not prepared in accordance with Generally Accepted Accounting Principles.

Reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in Pfizer's current report on Form 8-K dated today. We will now make prepared remarks and then we will move to a question and answer session.

As we expect there will be questions related to our proposal to AstraZeneca and I would also note that there are limitations to place on our responses by the U.K. Takeover Code and to such there will be some questions we are not in a position to answer at this time. With that, I will now turn the call over to Ian Read.

Ian?.

Thank you Chuck, and good morning everyone. During my remarks this morning, we will briefly recap the highlights from the quarter and provide some observations on how our strategy is progressing.

Before discussing the quarter, I’ll begin with a few words about the proposal we made to AstraZeneca to combine our two companies, and the rejection of our proposal by AstraZeneca’s Board.

The proposal we announced publicly last Friday represented a substantial premium of 32% to AstraZeneca’s shareholders based on AstraZeneca’s closing price of £37.82 on the day before speculation began regarding a potential proposal at 39% premium to the closing price of £35.86 on the day before our January proposal, and a 22% premium to the unaffected all-time high closing price since the formation of the company in 1999.

This is an opportunity for AstraZeneca’s shareholders to realize near-term value creation well in excess of its standalone prospects as well as the opportunity to effectively trade up their AstraZeneca position for equity in the new combined company with far greater potential for value creation.

Up to this point, we’ve only had access to publicly available information of AstraZeneca. Based on what we have learned through their information, we believe our revised proposal is compelling and responds to what we’ve heard from their shareholders.

We are very disappointed with their unwillingness to engage in conversations and believe it is in the best interest of both companies and AstraZeneca and Pfizer’s shareholders that we pursue a friendly negotiated transaction that can be recommended by both our Boards.

We would like to engage with AstraZeneca to gain a better understanding of their business and prospects. We believe they are an excellent strategic fit to Pfizer, and they have a strong and complementary alignment across and within our product portfolio and research platform.

That said, we remain very confident in our go-forward strategy regardless of a combination. We see this as further enhancing our strategy and consistent with creating shareholder value.

Regardless of whether we complete this transaction, the main pillars of our strategy remain in place; namely focusing on innovation and advancing our pipeline, maximizing the productivity and returns generated within our commercial businesses, and remaining good stewards of our shareholders’ capital.

We believe that our formidable proposal merits serious consideration. Given our position and strength, we will remain disciplined as we move through this process. Turning to our performance for the quarter, overall we continue to perform well in a challenging operating environment. Our financial performance was in line with our expectations.

Revenues for the quarter reflected the continuing impact of product loss of exclusivity and the expiration or near-term termination of some collaborations, a disproportionate amount of about one third of the anticipated full-year impact was recorded in the first quarter. If you exclude that impact, we had 1% operational growth.

We saw growth from many of our key revenue drivers including Lyrica, Xalkori, and Inlyta globally, Enbrel outside of the U.S. and Canada, recently launched products, Eliquis and Xeljanz in the U.S., and from our collaboration with Mylan to market generic drugs in Japan.

I would point out that our business has historically demonstrated seasonality of revenues, and this quarter was no different.

In terms of product developments we reported positive results from Prevnar 13 CapiTA study in older adults, and announced FDA approvals including supplementary new drug applications for Xeljanz to include radiographic data in the label, and for Eliquis for the prophylaxis of deep vein thrombosis, as well as FDA approval of Nexium 24-hour for over-the-counter use for the treatment of frequent heartburn in adults 18 and over.

And there were several positive elements in our pipeline, including positive results from a randomized Phase II study of palbociclib in combination with letrozole in first line treatment of ER+ HER2- advanced breast cancer.

Positive results from a randomized Phase II study of bococizumab in the reduction of LDL cholesterol, and a breakthrough therapy designation from the FDA for our meningitis B vaccine for the prevention of invasive meningococcal disease in adolescents and young adults.

For the full year revenue outlook, we anticipate key products will continue exhibiting growth, and that operational growth in emerging markets will be in the mid-single digit range rather than in the 3% range we saw in this quarter.

Typically, our sequential annual product revenue pattern exhibits relative strength in the late quarters compared to our first quarter. For the balance of 2014, we anticipate incremental revenue contributions from Eliquis, Xeljanz, Prevnar 13 adult, Duavee and the expected launch of over-the-counter Nexium.

As you know, at the beginning of this year, we implemented the new commercial operating structure to position the company for the future and to focus on maximizing growth. We have three global operating segments; global innovative pharma, global vaccines, oncology and consumer healthcare and global established product pharma.

These segments are fully functioning and are increasing the focus of management in providing greater transparency to shareholders and enhancing our ability to drive the business. As we previously committed to you, in today’s earnings announcement, we provided the revenues and costs associated with each of these operating segments.

In a few minutes, the leaders of each segment Geno Germano, Albert Bourla, and John Young, will provide you with additional context regarding the performance of their particular segment. While we have moved to this new operating structure, our overall focus and priorities have not changed.

We remain focused on driving future value creation for shareholders by delivering innovative new products, maximizing the potential of our existing products, remaining diligent in terms of capital allocation, and driving a culture that continues to foster strong ownership environment.

Reflecting on the state of our business, I am pleased with our pipeline progress. We are continuing to see the benefit of the decisions we took over three years ago when we decided to focus our research and development in the areas where we have the most expertise and where the greatest unmet medical need exists.

Looking at the compounds we have across all stages of our pipeline, I can confidently say that this part of our strategy is on track and gaining momentum. Similarly, our past and current steadfast focus on the prudent management of our capital is enhancing the overall competitiveness of our businesses.

This quarter, once again we operationally reduced our adjusted cost of sales, adjusted S&I expenses, and adjusted R&D expense in total.

We will continue to build on our solid track record of realizing benefits from cost reductions and productivity initiatives, and as we’ve done in the past we will use business development opportunities as an enabler of strategies for creating shareholder value. Overall, I believe we are performing well in a challenging operating environment.

Our pipeline is advancing. We have a strong track record when it comes to using capital to generate value, and we have an engaged and motivated work force that has embraced the culture of ownership. Collectively, these are the elements of our strategy that are helping to drive our overall business results.

Throughout this year, you will see us taking actions that execute on our plans to advance new therapies of patients, strengthen our commercial businesses, manage our cost structure, and deploy our capital in ways that yield the greatest value to our shareholders. Now I’ll turn over to Frank..

Thanks Ian and good day everyone. As always the charts we are reviewing today are included in our Web cast.

Before I begin I wanted to remind everyone that at the beginning of this year we began operating under our new commercial structure consisting of three operating segments, global innovative pharmaceuticals, global vaccines oncology and consumer healthcare, and global established pharmaceuticals.

Consequently, we are now reporting our quarterly and the annual P&L and the quarters with structure for all periods presented.

I also want to remind everyone that as a result of the full disposition of Zoetis on June 24, 2013 the financial results of the Animal Health business are reported as a discontinued operation in the consolidated statements of income for the first quarter 2013. Now let’s move on to the financials.

First quarter 2014 revenues of approximately 11.4 billion decreased 9% year over year reflecting a 3% negative impact from foreign exchange and operational decline of approximately 6% driven mainly by the expiration on October 31, 2013 of the co-promotion term of the collaboration agreements for Enbrel in the U.S.

and Canada, the ongoing expiration of the Spiriva collaboration in certain countries continued erosion for branded Lipitor in the U.S. and most other developed markets, the loss of exclusivity in subsequent multi-source generic competition for Detrol LA in the U.S. and other product losses of exclusivity in certain markets.

These were partially offset by the strong operational growth of Lyrica, Xalkori and Inlyta globally, Enbrel, outside of the U.S. and Canada, Eliquis and Xeljanz primarily in the U.S. the contribution from the collaboration to market generic medicine in Japan with Mylan.

In addition reported revenue included 57 million from transitional manufacturing and supply agreements with Zoetis.

Adjusted diluted EPS of $0.57 increased 12% primarily due to an aggregate operational decrease of 3% and adjusted cost of adjusted SI&A expenses and adjusted R&D expenses primarily resulting from cost reduction and productivity initiatives, a lower effective tax rate and a few diluted weighted average share outstanding due to our ongoing share repurchase program and the impact of Zoetic exchange offer.

Reported diluted EPS of $0.36 compared with $0.38 in the year ago quarter was positively impacted by the abovementioned items and lower restructuring and assets impairment charges compared at the year ago quarter.

Reported results were negatively impacted by the previously mentioned year-over-year decrease in revenues and the non-recurrence of income from discontinued operations associated with our Animal Business and the gain associated with the transfer of certain product rights to Pfizer’s JV with Hisun in China in the year-ago and finally higher legal charges compared with the year ago quarter.

And foreign exchange negatively impacted first quarter revenues by 3% or $364 million and had a net positive impact of $195 million on the aggregate of logistic cost of sales adjusted SI&A expense and adjusted R&D expenses.

As a result, foreign exchange negatively impacted first quarter adjusted diluted EPS by approximately $0.01 compared the year ago quarter. Now moving onto our 2014 financial guidance, historically our business has demonstrated seasonality of revenues and this quarter is no different.

That said we’re confirming all components of our adjusted 2014 financial guidance ranges and as such continue to expect our adjusted revenue to be in the range of $49.2 billion to $51.2 billion. We expect that the continued momentum from our new products including Prevnar 13 Adult, Xeljanz, Eliquis, Inlyta, and Xalkori.

The expected launch of over-the-counter Nexium and the accelerating operational growth in emerging markets will help to mitigate the impact of product LOEs and losses of alliance revenue. It’s important to note that our adjusted financial guidance continues to reflect a full year contribution from Celebrex in the U.S.

If necessary, we’ll update our financial guidance when we’re in a better position to make an informed judgment about the market exclusivity of Celebrex in the U.S. from May 30 through the end of this year.

We’d report to reported diluted EPS due to the applicability of the UK Takeover Code to our proposed combination with AstraZeneca, we’re not currently permitted to confirm or update our 2014 reported diluted EPS guidance which is our customary quarterly practice.

Preparation of certain reports by our reporting accounts financial advisors in accordance with the UK Takeover Code are currently underway.

Because Pfizer recorded a number of charges during first quarter 2014 relating primarily to the resolution of litigation-related matters, Pfizer's previously-issued 2014 reported diluted EPS guidance is no longer valid. Updated reported diluted EPS guidance will be provided as soon as practicable.

As required by the UK Takeover Code, the Pfizer Responsible Officers including Ian, Doug Lankler, our General Counsel in May confirmed that the adjusted financial guidance provided has been properly compiled based on the same assumptions set out in the adjusted financial guidance issued on January 28, 2014 and prepared in accordance with the accounting policies of Pfizer.

Now I’ll turn it over to the business leads Geno Germano, Albert Bourla, and John Young for the respective commentary and results for the Global Innovative Pharmaceutical’s Global Vaccines and Oncology and Consumer Healthcare and Global Established Pharmaceutical, Geno?.

Thanks, Frank, and hello everyone. On the Global Innovative Pharma is our research driven biopharmaceutical business focused on developing and commercializing innovative new medicines.

Our current portfolio consist of newly launched products including Eliquis and Xeljanz key in line brands including Lyrica outside of Europe and Enbrel outside of United States and Canada. In addition to the other products that we generally anticipate will maintain market exclusivity beyond 2015.

Our strategy involves making targeted investments to help grow our recently launched brands and other leading medicines in order to generate sustainable revenue growth overtime as well as making investments in R&D to support our next wave of innovative products.

Well, some of these near term investment objectives include continuing to build on a momentum with Eliquis among cardiologist focusing on its differentiated clinical profile building on the efficacy profile of Xeljanz in the United States through promotion of the data regarding inhibition of structural damage that’s now included in our labeling and also our mono-therapy indication.

Leveraging our presence in the women’s health category to launch DUAVEE in the United States as a potential new standard of care from moderate to severe vasomotor symptoms associated with menopause and prevention of postmenopausal osteoporosis.

Continuing investment in direct to consumer advertising for Lyrica, Chantix and Viagra in the United States plus investment in growth market such as Japan. In supporting ongoing Phase III clinical studies for bococizumab, ertugliflozin and Xeljanz. Now moving to the first quarter results for the Global Innovative Pharma segment.

In the first quarter, revenue declined 4% operationally versus first quarter 2013 and this was largely due to the expiration of the Enbrel co-promotion term in the United States and Canada. Revenues were also negatively impacted by the loss of exclusivity of Lyrica in Canada in February 2013 as well as some other smaller LOEs from prior periods.

We excluded the impact of Enbrel in these LOEs underlying operational revenue growth was 10% driven primarily by continued growth of Xeljanz’s Eliquis Enbrel outside of the United States and Canada and Lyrica outside of Europe. Now I’d like to review selected financial highlights for the Global Innovation Pharma segment.

As a reminder, the revenues and expenses presented are those that were directly attributable to the GIP segment. First quarter 2014 income before taxes declined 5% operationally to $1.8 billion versus first quarter 2013. IBT as a percent of revenues on an operational basis declined modestly to 57.4%.

Increased investment in recently launched brands and key in line products partially offset by benefits from cost reduction and productivity initiatives resulted in a 12% operational increase SI&A expenses compared to prior year quarter.

Our first quarter 2014 R&D expense grew 29% operationally compared to last year as we initiated Phase III programs for bococizumab and ertugliflozin and continued investment in our expensive clinical development program for potential new Xeljanz indications.

Additionally IBT in the first quarter 2014 benefited from a significant increase and other income primarily due to trailing royalties earned on sales of Enbrel in the United States and Canada after October 31, 2013.

On that date the co-promotion term of the collaboration agreement for Enbrel in the United States and Canada expired and we became entitle to royalties for 36 month period. In conclusion we are excited about the GIP portfolio and our pipeline. We believe our focused investment strategy this year will drive sustained future revenue growth.

And now I’d like to turn it over to Albert Bourla to discuss the Global Vaccines, Oncology and Consumer Healthcare segment..

Thank you very much Geno and hello everybody. Both these comprised of three separate distinct businesses, vaccines, oncology and consumer healthcare, each poised for organic growth over time. We’ve had an eventful year so far and have several significant milestones.

First with vaccines, we presented positive results from Prevnar 13’s CAPiTA trial at the major conference which clearly demonstrated that Prevnar 13 can prevent a significant portion of pneumococcal community acquire pneumonia in adults’ age 65 and old.

Evidence from this study is important for population in which age related decline of the immune system makes it difficult to prevent disease. Hospitalizations due to pneumococcal pneumonia in adults represent a growing burden to public health systems. For example, the annual cost of adult hospitalization in the U.S. alone is estimated at $8 billion.

We look forward to further discussing this data with regulatory authorities and vaccine technical committees to help inform decisions regarding Prevnar 13 label and recommendation of the age. Regarding ACIP we have had productive interim discussion with pneumococcal working group.

We are prepared for more formal ACIP presentation in June should the CDC confirm that topic in their agenda. Second, in vaccines again, the FDA granted breakthrough therapy designation of our vaccine for meningitis B, a disease that is characterized by rapid onset with high rates of fatality. We intend to a BLA with the FDA by mid-2014.

Moving to oncology, we presented positive results palbociclib’s PALOMA-1 trial at the major conference. We are very pleased with the results which highlight the potential for palbociclib to become a new standard of care for women with ER+ HER2- advanced breast cancer.

This is encouraging information for these women who represent approximately 60% of the advanced breast cancer population. We’ve continued to have productive and ongoing discussions with the FDA about this data as well as the other necessary supporting data for a new drug application.

We continue to envision its potential by way to filing an NDA based on the PALOMA-1 data. Although, no decision has been made. Once one has been made we will communicate it public.

We also begun those in patients in two additional Phase III trials one in recurrent advanced breast cancer and one in early breast cancer and next we reported positive results for the Xalkori compare to chemotherapy in the first line setting for all positive non-small cell lung cancer.

Final with consumer health care, we receive FDA approval for Nexium 24HR for over-the-counter use. This approval represents the first significant milestone in executing our Rx to OTC strategy. The U.S. launch is set for May 27. We also continue to advance promising candidates to position the next wave of potential innovative launches including the C.

difficile and staph oral vaccines as well as our small inhibitor for hematologic cancers. Now let’s go the VOC first quarter results. For this quarter VOC segment delivered revenues of $2.2 billion which represent an increase of 1% operationally versus Q1 2013.

Please note that the revenues and expenses presented are those that were directly attributable to the VOC segment. Revenues for vaccines increased 2% operationally driven by the U.S. primarily reflecting government purchasing orders.

Internationally, revenues were flat operational with emerging markets growing at 14% rate driven primarily by China and gavi (ph) purchases but essentially offset by declines in the UK and Canada.

Oncology revenues increased 10% due to growth for new products Xalkori and Inlyta partially offset primarily by changes in Sutent buying patterns in certain markets. Consumer health care revenues declined 3% operationally due to a soft cough, cold, flu season in the U.S. and Canada in comparison with the same period last year.

Extreme winter weather negatively impacting retail traffic in the U.S.

and increased competition for our group with the return of certain brands to the market; however, it is important to note that as the year progresses we anticipate revenues to be positively impacted as more healthcare providers appreciate the value of the Prevnar 13 adult indication.

Of course the therefore potential will depend upon updated labels and recommendation of the seasons. Additionally we expect revenues to be positively impacted by the launch of Nexium 24HR and other consumer products the timing of certain national immunization programs and continued uptake of recently launched products in oncology among other factors.

I would like now to walk you through a few additional highlights from the VOC segment finance as typically regarding our income and our direct managed expenses. VOC segment income before taxes was 1.1 billion or 48.6% of our revenue. This represents an improvement of 2.8% points operationally.

Our gross margin was 1.8 billion or 81.2% of revenue, an improvement of 0.8% points compared to the year ago quarter. Due to a greater percentage year coming from our Oncology and Vaccines business as well as further cost efficiencies in manufacturing.

SI&A expenses were $531 million, this represents a 2% increase operationally primarily due to prelaunch expenses for Nexium; however, as a percentage of revenues our SI&A expense has remained consistent year-over-year.

The VOC R&D expenses were $184 million which represents an 18% decrease due to the completion of certain Phase III trials which more than offset incremental costs related to the expansion of the palbociclib clinical development program.

Thank you and I will now hand it over to John Young, Group President of the Global Established Pharmaceutical segment..

Thank you, Alert, and good morning everyone. Global Established Pharma is a large and highly diverse business with unique opportunities across portfolios and geographies. It’s a significant cash generator and its Pfizer’s largest business.

For the first quarter of 2014 the GEP business accounted for just over half of Pfizer’s total revenue and about two thirds of Pfizer’s total revenue from the emerging markets comes from GEP. Notably during the first quarter, emerging markets comprised nearly 30% of the GEP segment revenues.

Contributed to some perceptions of this business traditional commodity generic products in develop markets are actually very small part of the GEP portfolio. And it came through in May by 5% of GEP revenues.

We see our GEP strategic priorities as two fold, one is optimized the financial performance of the decline in components in the developed markets. And two focus on the current and future areas of growth and reversing the decline in trend. I am not optimizing the business margins over the mid to longer term.

Before I get into the details of the GEP performance of quarter one, I’d like to give a quick overview of the business and have it structured. GEP is comprised of three components I have different market dynamics. Two of these components are in the developed markets.

First, Peri-LOE includes major brands have recently aloft or are approaching a lots of exclusivity. Such as, Celebrex, Lyrica in Europe, Zyvox, Pristiq and Detrol. Secondly legacy established products include mature off pattern products such as Lipitor and Novex and we also have targeted opportunities that exist in this product grouping.

We expect to see a decline in both of these areas, featuring tense erosion from generic competition. However, we will continue to focus on growing the patterned brands prior to the loss of market exclusivity, as well as to optimize the transactions of brands to the off pattern stage and extend their life beyond LOE.

The third component is the emerging markets including the BRIC-MT markets. This includes all GEP product sold in emerging countries and growth opportunities in emerging markets including the BRIC-MT’s. This component is expected to grow steadily driven by favorable macro-economic and improving social-economic conditions in these countries.

Growth opportunities represents fourth dynamic of the GEP business, that includes organic and inorganic initiatives such as partnerships product enhancements and are by similar portfolio spanning both developed and emerging markets.

We anticipate these opportunities will drive revenue growth and legacy EP developed and emerging markets portfolios overtime. Now let’s go to the GEP first quarter results.

For this quarter GEP delivered revenues of $6 billion which represents of 10% decline operationally, the Peri-LOE products in developed markets experienced an overall decline of 17% operationally. Due to lots of exclusivity and subsequent multi store generic competition for Detrol LA in the U.S.

and for Viagra in most European markets, as well as the determination of the co-promotion agreement for Aricept in Japan and the decline in our share of revenues resulting from the winder determination of this three our co-promotion agreement for certain markets.

However it’s important to note that certain pattern protected products have shown positive operational growth including Lyrica in Europe, Pristiq in the U.S. and developed international as well as Inspira in developed international markets.

Our legacy established product in developed markets experienced a 10% operational decline from early due to the continued share erosion by generic versions of Lipitor in the U.S. in most developed international markets.

The legacy emerging markets increased 1% operationally, growth was negatively impacted by certain onetime of shares under moving this operational growth would have been 4% driven by BRIC-MT markets.

The growth opportunities increased 10% operationally driven primarily by contributions from the collaboration with Mylan to market generic drugs in Japan and Quillivant XR sales in the U.S.

These growth opportunities performance is reflected in the previously mentioned operational results of legacy established products in the emerging markets components. The revive one final metric for how we measure GEP’s underlying performance, expiring alliance product to LOE and Lipitor in developed markets.

The operational revenue decline in the first quarter 2014 for the remaining 92% of GEP’s portfolio was 2%, other post to 10% for the segment overall. I’ll now walk you through a few additional highlights from GEP financials and we’ll explains what it’s driving some of the rations and how I see them revolving.

In terms of the ratios, obviously speaking to our direct managed expenses relative to our revenues, income before taxes that is directly attributable to GEP was $4 billion in the first quarter 2014 or almost 68% of GEP’s revenue. This represents and improvements of 1.7 percentage points on an operational basis.

Our gross margin as $5 billion, or 83% of revenue this is representative of the portfolio profile of the GEP business that is mainly composed to pushed LOE on Peri-LOE brands with a smaller contribution from generics. As large brands with market exclusivity this gross margin will come under pressure.

GEP, SINA expenses were $837 million in the quarter this represented a 20% operational decrease and it’s primarily driven by the increased sale force expenses in the both develop and emerging markets, as well as resource allocation favoring higher growth opportunities within the emerging markets.

This 20% reduction also reflects a favorable onetime item this quarter related to administrative expenses. We will continue make SI&A expense discipline a focus of the management of our business. The GEP R&D expenses for the quarter are 2.3% revenue and represent a 23% operational decline.

This is the result of focused reductions in operational expenses, partially offset by higher spending for clinical trials associated with the development of our biosimilars portfolio. Moving forward we expect to increase investment in those assets that have entered and will enter Phase III.

In summary, while GEP is expected to go through a period of revenue decline over the next few years primarily due to the LOEs of major brands in developed markets.

We are focused on building our revenue base and stabilizing margins over the mid to longer term and following the period of anticipated LOEs we expect revenue growth to return other growth opportunities become a more substantial piece of the GEP business in the future. Thank you and I’d now like to hand it back to Frank..

Thanks, John. Now moving on to key takeaways our first quarter 2014 results were in line with our expectations with effective loss of exclusivity of certain products, the expiration in near term terminations of certain collaboration agreements and a continued challenging operating environment.

We confirmed all components of our 2014 adjusted financial guidance which continues to reflect the full year contribution with Celebrex in the US, we’re now operating under our new commercial structure and presentation of our financial results for the new structure provides transparency and to each of our global segments, with respect to our late stage R&D pipeline we achieved a statistically significant primary endpoint resulting in our PALOMA-1 Phase II breast cancer study of Palbociclib and began dosing patients for two Phase III breast cancer trials and we presented positive results of our CAPiTA trial which demonstrated Prevenar 13 prevented a first episode of vaccine type community acquired pneumonia in adults 65 years or older.

We continue to create shareholder value through a prudent capital allocation. Today the 2014 we’ve repurchased $1.7 billion or approximately 54.3 million shares and we continue to expect to repurchase $5 billion of our common stock this year. Finally we remain committed to delivering attractive shareholder returns in 2014 and beyond.

Now I’ll turn it back to Chuck..

Thanks, Frank and I want to thank the audience for listening, I know the prepared remarks were longer than typical but given it was the first quarter with the new financials for the segments we wanted to give our business leaders some time to walk through their segments and the financials.

We’ll get ready for the Q&A session and I think I would just reiterate once more related to questions regarding AstraZeneca we will limitations placed on the responses by the UK takeover code. With that operator, if we could please poll for questions, thank you..

(Operator Instructions) Your first question comes from Mark Schoenebaum from ISI Group..

Good morning Frank thanks a lot for taking the question. If I could just throw one at you, I’m sure you’ve gotten this in all kinds of one-on-one meetings, but it might be good just to address it again.

You know the big concern I guess about the AZ deal or proposed deal is that you guys obviously think there’s something wrong with Pfizer if Pfizer wasn’t able to acquire AstraZeneca, so I was just wondering, Ian or Frank, if I could just get a general reaction to that.

And then number two, the Street as I understand, it is currently modeling pretty dramatic revenue decreases for GEP as well as more modest decreases for GIP over the long term, and I heard in the prepared remarks you talked about a return to growth in GEP and I was just wondering if you could expand on that a little bit and help us out.

I know you did a little bit, but I’d appreciate some more color if possible. And then finally, an easy one for Frank, since you have 2013 segment information at least for the 1Q 13 in the press release, is there any chance that those numbers could be audited such that that would become year one? Thank you very much..

Thank you Mark for your one question, you know I think we’ve gone out of our way to say that this, I see this AZ deal as a way to accelerating an already good strategy.

I think we’ve gone at pains in this release to point out the exciting developments in our pipeline, the evolution of fixing of any core, the way we return value to shareholders, and so I definitely feel that we did this out of position of strength.

In fact we having approached AZ in December and having received a negative from them in confidential conversations decided to wait until we had results of Palbociclib and adult vaccine, so that if we came back into the market it would be seen as we’re coming back from a position of strength.

So, you know we will continue to operate our business, continue to drive shareholder value and feel very confident about our standalone strategies.

I’m going to ask John to talk a little bit about GEP, and I believe it was interesting enough in GEP when you took out the loss of exclusivity or loss of the deal with Amgen you know and other small LOEs, it was 10% growth which is a really good growth in that area, solid in that area. John, regarding GEP..

So, thanks for your question Mark, I think we’ve -- certainly in my prepared remarks and in the meetings that we’ve had with the analyst community, one of the things that we’ve been very clear on is that we knew that in the short to medium term, we will see pressure on revenues as we experience losses of exclusivity from some of the major brands in our portfolio that are either already post LOE and are still coming under pressure, so brands would include Lipitor falling into that bucket or some of the major brands that we have in our portfolio that have yet to lose exclusivity but will do so over the coming few months and years, so brands like Lyrica in EU, like Celebrex in the U.S., like Zyvox and so on.

So to be clear we certainly know that this is a business portfolio which will come under revenue pressure in the short to medium term.

But in the medium to longer term we certainly see our revenues plateauing and having the opportunity to return to growth, and the underlying drivers for that opportunity that we see in the medium term would include our biosimilars portfolio.

We believe we’re going to have a strong biosimilars portfolio of we hope ultimately five biosimilars that we will aim to bring to market. Clearly, the landscape for that type of portfolio in the regulatory environment is still evolving, but we have regulators that have clarified the regulatory pathway.

We actually believe that as a very positive opportunity for growth. And additionally, we see the opportunities for growth with this portfolio in some of the emerging markets including China as an example, but not limited to China, remain very positive. Our China business continues to perform well.

And additionally, we see additional opportunities for growth with certain key partnerships such as Hisun in China and our Teuto partnership.

So when we put all of those things together, whilst in the short to medium term we certainly will see continued pressure on revenues in the medium to long term, we do believe that this business does have a number of underlying factors which will enable us to return to growth in the medium to long term, so hopefully that answers your question Mark..

Thank you, Frank..

And Mark, no change from what I’ve said previous. 2014 year one, three years prospective audited financials, and I think the key here is remember audited financials require more than an income statement. They require a balance sheet, a cash flow statement, another comprehensive income statement, and the shareholders equity statement.

So, no change from what I’ve said previously..

Thanks Frank. Next question please..

Your next question comes from David Risinger from Morgan Stanley..

Thanks very much. Good morning, Ian and Frank, and the rest of the team. I just had two questions.

First, with respect to Xeljanz obviously the competitive landscape will evolve down the line, but you’ve talked about driving greater uptake, could you just comment on why you wouldn’t consider discounting more to drive greater share? Obviously, the plans are using safety concerns to limit formulary adoption in an attractive Tier 2 status position, but really the plans obviously get tremendous rebates on Humira and Enbrel, so I guess I am just wondering how we should think about the pricing strategy for Xeljanz and if pricing can be a greater lever to driver greater uptake? And I guess just a follow on to that is since you’ve asked for just one question, could you just update us on the once a day formulation development and filing timing? Thank you..

Thank you, David.

Geno could you take those questions?.

Yes, and obviously Dave we’re keenly aware of the kind of pricing and access and reimbursement environment for Xeljanz and then frankly in the whole class of biologics for RA and have run all the scenarios and frankly at this point in time we think the best thing to do is to continue to build on the positive profile that we’re seeing with Xeljanz the data from our Phase III studies from our long term extension now we have the structured data in our label.

We have positive outcomes from patient reported outcomes analysis and we think that that will give us the strength that we need with physicians and with payers to continue to grow the business. We saw a nice increase from fourth quarter of ’13 to the first quarter this year with a 16% uptick in prescriptions and we continue to gather momentum.

So we’re feeling pretty good about that. With regard to the once a day we are putting the data together and I believe we’re planning to file next year..

Thanks Geno.

Next question please operator?.

Your next question comes from Chris Schott from JPMorgan..

Great, thanks very much, and I appreciate all the business unit details it’s very helpful to understand the company here.

So two questions, the first was if you actually split your business into three standalone entities can you quantify how much more operating expense or dyssynergy the company would incur I think which would be a helpful data point as the street looks to value your various business units? My second question is just managing the company in this business structure it’s been four months.

Maybe the business unit leaders could you just talk about what they’re finding in terms of the strategy and expense structure of the business.

I guess my question is should we think about are there incremental cost cutting or updated strategic priorities for one of more of these units over time as the new management teams kind of further review their franchises or is everybody pretty comfortable in terms of how the business that they’re positioned today and how they’re being managed? Thanks very much..

So Chris on this idea of three segments I think I would sort of withdraw the market to the view that there are actually two major segments inside the company.

There is an innovative core and there is an Established Products and as we look to the future optionality, I'll be more focused on that and looking at multiple businesses with multiple dissynergies.

So we don't really think there's any material dissynergies, if these businesses were to be standalone or these two segments, in fact, we think that management focus overcomes those types of dissynergies.

And on the, sort of getting at this stage given we've taken so long with prepared remarks, I'm really going to just say that I think we feel that we've laid by our opening comments the major strategies of these businesses and during the year it will be ample time I think for the business unit leaders to have conversations with you.

Frank, do you want to add something to that?.

Yeah. Just a couple of quick things on the first point, Ian on the standalone to respond to Chris.

Chris, we gave you all the detail we could relative to kind of the direct managed and then the allocated piece with the big chunks of the allocated piece being research and development through PAC, medical and then corporate centers, so finance, IT, those kinds of functions.

In terms of hypothetically, if they were separate companies, there'd be some incremental cost, right? There's one CFO in the company today. They'd each need their own CFO and they'd each need their own General Counsel. So, there'd be those kinds of incremental costs.

Then, we didn't assign any of the interest expense or the interest income to the businesses either. We left it out of the allocation. So, there's some items clearly that would be incremental if they were to be standalone but to Ian's point, I don't think there's anything that would be really material to those being standalone..

That’s correct. Well, our next question please..

Your next question comes from Jami Rubin from Goldman Sachs..

Just a couple. On Prevnar 13, you had mentioned that the next ACIP meeting is June.

What are the potential outcomes of that meeting? I would assume that the most realistic outcome given the results of CAPiTA would be that the, the Prevnar 13 would be included in the 65 and older mandated vaccination schedule, if you could confirm that? And then, just one other question or rather two other questions on the new business structure.

Ian, how does the business development process work in the context of the new structure? So, if VOC wants to make an acquisition or GIP or GEP, I may have gotten those wrong, wanted to make acquisitions, are they competing with each other for capital? How do you assess which of the three groups get capital to make acquisitions? And just finally Frank, I noticed when you broke down the three businesses that there is a very large R&D expense, $896 million allocated under Other.

How do we think about that Other business? How do we allocate that across the three businesses?.

Well, Jami, thank you for the questions. I'm going to just answer the Prevnar 13, because I think we're -- to say -- we took a long time in the prepared remarks, they will consider in June. Normally, the usual practice is for ACIP to have two meetings, one to debate and then the second meeting they would vote on.

They may decide to short-step that in June and both discuss and vote but the normal pattern would be a discussion in June and then a vote in October.

Albert do you want to add anything to that or is that fine?.

That's fine. It's not unprecedented what they have done it one….

It's unprecedented -- we're working with them. The data was really good, but we're working with the agencies as hard as we can to get them to see and get excited about this data.

On BD, how it works is? That there is a corporate cost of capital and BD is run corporately, in essence each business unit will have projects that they bring forward to the corporation. Competition for capital is not necessarily -- we're not necessarily limited in capital. There's a competition for good ideas and best returns.

And I think the most important thing of this structure is that it puts the business leaders on the accountability side of the projects they want to get funding for.

So I think it clears up and makes it very, very -- it's good governance that inside the company now, a BUD that says I want to do this project and I stand by it and I'm a champion by it and the accountability attached is which I think brings a great judgment and a great discipline to capital allocation.

Frank, do you want to add anything to that?.

No. I was going to answer Jami's third question on the ecos, I don't have anything to add on the business dev point. Jami, I think, the best way for me to explain this is to point you into the certain pages of the release and just quickly walk you through it, if that's okay.

So, if you go to Chart number 18, you'll see up on the top quarter ended March 30th, 2014,and there's a column called Other and in that column called Other, there's an R&D expense line which amounts to $896, which is the number you quoted.

If you go to the next page and you go to the tables on the bottom, but the one higher up on Page 19 you'll see the $896 off to the far right column and then you'll see the breakdown of that between the different organizations.

Then if you go to the next page and you go to the table again, but the bottom three numbers, you'll see in the last number there, research and development expenses and you see how we give percentage ranges to drive at each of the BU.

So we try to provide drill down for you all so you could see how we take the numbers and then how we drill them down and we gave you ranges of allocation to enable to you to do that by position..

Your next question comes from Jeff Holford from Jefferies..

Thanks for taking my question. I don’t know what to answer this to, but obviously AstraZeneca in terms of its statements has pushed back around valuation to mix of cash and equity and also execution risk.

Would characterize conversations you’ve had with shareholders voicing similar concerns or perhaps there is a slight different perception as you go around asking about that? And just another side question, just on GEP, I wonder if you could breakdown the current R&D spending in terms of what would be on newer projects such as biosimilars and what might be associated most of the older based business products? Thank you..

We listen to the shareholders and we thought it was a compelling offer which fully valued AZ and we’re waiting commentary back or further commentary back from AZ.

On the R&D I’m giving you quite a lot of statistics in the backup pages for you to allocate R&D, but perhaps John, do you want to make a couple of comments on the main sort of around spending gap?.

Yes. Obviously, the precedent we don’t sort of go into detail on the sort of breakdown of R&D expenses in overall. I think what I’ve mentioned, Jeff, in my sort of opening comments, is that, that obviously includes operational expenses for the business unit as a whole and also includes the expenses for the development of the biosimilars portfolio.

I think at this point that’s probably is as much detail as I can give..

Your next question comes from Seamus Fernandez from Leerink..

So first question for Frank and then the second question is actually on Prevnar 13.

Frank, can you just talk about your cash and borrowing capacity and remind us what your current reading is and what the difference in the borrowing costs might be from the current rating to a single step down in the rating? Then separately as we think about Prevnar 13 and the adult indication, obviously there has been quite a bit of impressive data already accrued in terms of the herd immunity that we have already seen presented to the ACIP.

I am just wondering, if you could help us understand that in terms of the evaluation of Prevnar 13 particularly in international markets and the willingness for national immunization programs to pay for the adult indication? Then just a last question on Prevnar 13, the ACIP also reviewed a possibility of a three dose schedule for Prevnar 13.

Can you just update us quickly on how a three dose schedule might actually evolve or if that’s a very unlikely situation or if the product is already being used mostly at a three dose schedule?.

Okay, so I will ask Frank to answer the cash and borrowing and costs and then will ask Albert to take the Prevnar adult and the ACIP three dose question..

So Seamus let me start with on the current ratings with S&P - I’ll do long-term ratings first; S&P were AA. Moody’s were A1, Fitch were an A plus. On the short-term ratings with S&P we’re at A1 plus, with Moody’s we’re at P1, with Fitch we’re in F1.

In terms of cash and borrowing capacity, the end of last year [audio gap] dollars, obviously given that, given our ratings, we have a significant amount of borrowing capacity and in terms of a change in rating, well that due to our borrowing cost.

Obviously, you got to make assumptions without notches, but I don’t think there’d be any material notch change. So whatever changes they were would not be material. And quite frankly, if you look at the capital markets these days and investment grade paper it’s a very favorable market..

Let me start first with the herd effect and then I will speak about the dosing schedule. While Prevnar 13 has led to substantial reduction in the incidence of pneumococcal disease, the residual disease burden in the U.S. and globally is still significant. Even a decade after the introduction in the infant program, in U.S.

alone, there are 440,000 cases of non-bacterial pneumococcal pneumonia. They account for 300,000 hospitalizations, 200,000 emergency room visits, and unfortunately 90,000 deaths. And globally, WHO has also similar estimation. 600,000 to 800,000 adult annual deaths due to septa caused pneumonia which is the leading cause of cough.

We need to understand that the scientific community and us of course do not regard the herd effect as an alternative to direct vaccination. So in summary, we believe that the vaccination with Prevnar 13 represents a compelling value proposition for healthcare systems around the world. Moving now on the dose schedule.

First of all, we support the continued scientific exchange on the topic, but having said that, we have a vaccine schedule in the U.S. that has demonstrated success, and we believe that this clinically proven FDA approved CDC recommended four dose schedule is the optimal way to protect the U.S.

infants and young children from pneumococcal disease and also we believe there are no data in the U.S. population to make a decision to divert from this four dose schedule, that it is proven to be so successful..

Thank you, Albert. From my point of view and I think from society's point of view, the Prevenar 13 vaccination schedule delivers considerable value and we see that value to society in the overall treatment and don't necessarily really look at it as a per dose cost. It's more an overall value delivered by the protection.

Mike, do you want to add a little bit about the herd effect?.

Albert described it very well and I could just comment, kind of one clinical aspect, what we learned in Netherlands is that when we typed the serotypes from the pneumonia and IPD cases, which was possible by a proprietary assay that we have developed, it was nicely shown that a significant fraction, about a quarter of the cases requires to serotypes from the regional Prevenar to 7-valent which clearly shows that although there has been immunization, there is a residual serotypes remaining in the population and herd effect is not sufficient to protect.

Finally, I just want to add a medical aspect that - with increasing age you're more susceptible to severe outcomes and increased fatality, first by age, underlining the importance that Albert alluded to, to get the campaign rather earlier than later in adults for protection..

Your next question comes from John Boris from Suntrust..

Thanks for taking the question. Just first question is for Frank, when we look retrospectively at the last big breakup that we had which was Abbott spinning off AbbVie, when we look back at that transaction there was some dilution that was associated with it.

By our math, the breakup of the two companies was about 15% dilutive in retrospect to what the separate companies would have earned if they'd stayed as one. In this instance, you're breaking up into three.

What is the potential dilutive effect operationally and potentially from any tax leakage by breaking the entity up into three different businesses? Second question, just for Ian, you indicated in your opening comments that once you had the palbo data and the Prevenar data that, that positioned you at least from a position of strength to be able to go back to AZN.

Is your assumption that on palbo that you'll be able to file in '14 and then launch in '15 and are you assuming you're going to get a universal vaccination recommendation on Prevenar going forward, and is that the position of strength that you're coming at this from?.

Thank you, you know on this whole issue of Abbott and AbbVie, we really can't comment on how they went about restructuring and what expenses they incurred and what dilution they incurred.

I do believe though just from memory that, that, I think if you took the value of the two separate companies after they did this and you stripped out general market movement, they still created many billions of dollars of value. So, I think that's a more important issue than the dilution or the small incremental cost of the separate companies.

By the way, as I've tried to reemphasize, John, we are not talking about -- if we are -- there's no decision been taken regardless of separating these companies, and certainly, we are not talking about of three or four ways split, we are talking about two major segments, just to emphasize that.

On this question of yours on position of strength, I was not trying to assume any action on the part of the FDA or the ACIP panel, I was just talking about the strength of the data and the data is compelling and that one would expect the marketplace to follow the data. So thank you for the question..

Your next question comes from Tim Anderson from Sanford Bernstein..

Thank you, couple of questions that are both merger related.

What things do you think that a merged Pfizer and Astra can do better than Astra alone? In other words, what do you see as potential weaknesses of Astra standalone business either in terms of product mix or R&D abilities or geographic positioning or anything else? Then, I want to go back to a question I asked on the call you guys did last week just to confirm or reconfirm Pfizer's intentions assuming it acquires Astra, is it again most likely that you would take the post-merger entity and eventually split it up completely into separate publically traded companies because it's kind of a different story if the answer to that is no.

So, I guess I am just looking for some continued assurances here and not promises but rather what's most likely or is there something about in version and re-domiciling in the U.K.

that would make a full split-up like that more difficult?.

Yes. So I think if you look from our point of view, if you look at AZ and it's my view not their view, so I am talking of my view of their strategy, not their view of their strategy that they have had a strategy of confronted with massive LOEs. They have gone out and they have licensed in and brought in lots of products from other companies.

In fact, most of their pipeline is licensed in products with very few developed nationally.

But -- so we look at that and we look it to fit with our portfolio, especially immune Oncology area, where they have assets which standalone or probably coming late to the market, but if they were combined with our portfolio, I think it strengthened their portfolio substantially. And then when you look at their products, they fit into our categories.

So we believe that with our marketing presence and our ability in those categories, we can make more out of those products that they can standalone. But the power of this deal for us is these three components, it’s the fit on the portfolio; it's a nice fit with the early pipeline, but it's not a pipeline story per se.

It's also a removing of overlaps and making the organization more efficient.

And I do believe you’re seeing, you will continue to see a trend in the industry towards as governments pressurize on access and pricing, they are really telling the industry you need to get more efficient, you need to bring to market higher value products at a lower cost and there are ways -- different ways of doing that, there’s internal improvements in your efficiencies which Pfizer has done and been very effective at.

There is asset swaps as you saw going on between GSK and Novartis, which also gets to -- getting companies to remove overlaps or there is industry consolidation which -- this would be an example of that.

And then the third component of value here which is really important for Pfizer is its ability to free the balance sheet up and get our tax rate down, which would enable a lot of different strategies.

And so all three of these elements are important, I've been asked would you do it if you didn't have this part or you didn't have that part? I mean the answer is I'm doing it because I have all three parts and it strengthens our strategy right now and creates I believe compelling shareholder value.

I would say on your other question that we are interested in preserving optionality that we've set up. We would see the integration of AstraZeneca with Pfizer along the way that we are organized. We would preserve that optionality.

We would focus on managing those businesses as efficiently as possible and no decision has been taken about the future as there's been no decision taken about our businesses at this moment in time, but we would conserve that optionality..

Thank you, Ian. Next question please..

You next question come from Marc Goodman from UBS..

There’s couple of things. First, you had mentioned last time on the call about palbo that you were going to be meeting with the FDA. I just wanted to know if that meeting actually had taken place, if you have it scheduled yet. I was a little unclear about your comments on palbo there.

Second, the meningitis B vaccine, when will we see the data? And then three, on biosimilars can you just remind us of when will we start to see data from the studies there, these pivotal Phase IIIs and filings start to occur? Thanks..

Okay. Thank you. On palbo, it is scheduled. It is extremely imminent and once we've had that meeting and once we have any confirmation from the FDA, we will let you know, but we're still in discussions with the FDA.

On Mening B, I don't know who's the best here -- Mikael, do you have the data or there’s…?.

Yeah. I can just mention that, we are in the process of sharing data at conferences.

It includes experiences from our Phase I, Phase II and dosing schedules and also they're recording data, strong data on combining Mening B with vaccines that are used in these age groups, such as GARDASIL or the typical adolescence vaccines, different schedules in Europe and U.S., hence we would present soon at the European Society for Paediatric Infectious Diseases and later in this fall, corresponding U.S.

presentation too..

Thank you.

John, biosimilars?.

So, we'll get back to you with some specifics on our plans for presentation of the data. I mean, just to remind you, we have two of our portfolio, which are in Phase III, we have rituxumab, which initiated a Phase III or initiates Phase III in second half of this year. We have trastuzumab where Phase III has already been initiated.

So, rituxumab will go into Phase III in second half of the year, trastuzumab is already there. So, it'll be some time before we see the readout of those studies, but we'll get back to you separately in regard to your question about when any plans to present any other of our Phase I data..

Yeah. Thank you and I would say internally that Mikael is very satisfied with the profile that we're exhibiting and the ability to say that is biosimilar and we're very pleased with the science we have and the capabilities around this development area..

Right. We can move to the next question..

Your next question comes from Steve Scala from Cowen..

Thank you. I have three brief one. First, why is stage R&D such a high percent of the total, 56% of R&D is unallocated to any division, which seems high versus your peers. Second is there still uncertainty around Celebrex U.S.

sales from May 30th to the end of the year given the settlements? And then lastly, Ian, are you willing to give any assurances of limited R&D cuts in U.S. like you did in the U.K.? Thank you..

Thank you.

Could we do, first of all the -- yes, the early stage and the allocation algorithm there and then dub you on through the uncertainty?.

So, I think the best way to answer this Steve is the way we manage the organization, which is all of the post-POC R&D spend is in the business units, the new operating segments, the pre-POC R&D spend. So all the discovery, the research up and through inclusive of POC is in Mikael Dolsten’s organization WRD.

That’s what you’re seeing in the other column. That’s really what’s driving that. So that’s why you get the split that we currently have..

Yes, so on Celebrex both Mylan and Actavis have sued the FDA having concluded that FDA will give Teva, 180 days exclusivity. They believe that unless the courts overseeing those suits rule in Mylan and Actavis’ favor and change FDA’s ruling that Teva is going to have exclusivity.

We previously settled with Teva and as part of that settlement the earlier stage Teva can launch December 2014 their exclusivity would begin then..

Frank do you want to add to that?.

Just -- and I should have mentioned partner alliance too, regulatory toxicology all those kinds of things Pharm Sci are all in that other column as well..

So, on your question about the integration of the two companies, I think we’ve made some commitments to the combined Company’s presence in the U.K. and we clearly will stay with a massive presence in the U.S. as a combined Company..

The next question comes from Vamil Divan from Credit Suisse..

On the VOC unit, Albert, you mentioned these are really three different businesses kind of blended into one.

Can you just talk about that one specifically in terms of the synergies and overlaps you see that may give or probably keep them all as one unit as opposed to being structured maybe differently? And then second just on the consumer side, you’ve highlighted the news around Nexium 24HR always have some displaying news for your singular potential being in OTC product, just given your -- you’ve been generally bullish on the Rx OTC switch opportunity, how important do you see to have consumer business internally to be able to profit from that opportunity as opposed to maybe do alliances with other companies that might have consumer if you didn’t have one yourself?.

Vamil, thank you for the questions. First question remind me again was on….

The three separate….

Well, look, see, these units are independent global units that are run basically separately. I think any type of -- and Albert is a very experienced business leader and has three division heads reporting to him.

Any type of synergies between those businesses is more of the nature of managerial talent and leveraging strategies across great leaders and not really address towards synergizing the operational infrastructure those businesses, as all these things, they are global and they have their own culture and their own focus which is part of the reason why we made them global businesses.

On the other side, from the point of view of the corporation, consumer business is an important business for us. We see there’s a great store of value. We’ve made acquisitions in that business, and the OTC strategy is a component of the value of that business. But we are not just managing that business only because we have an OTC strategy.

We see acquisitions as part of that strategy and switches and organic growth and freshness index in the business and continuing to make sure that business grows. Thank you for the question..

And we have time for our last question please, operator..

Your final question comes from Alex Arfaei fro BMO Capital Markets..

Ian at one point would you consider going directly to the AstraZeneca shareholders. You mentioned a premium that you are offering plus as well as your disappointment by the company’s lack of engagement.

Then on the pipeline and approaching AstraZeneca from a position of strength, other than palbo and Prevnar 13 in adults, what are the other key assets that you believe may not be adequately appreciated by the Street? Thank you..

We’ve made public our offer to the Board. We remain considering all our options on how we progress these discussions. I think on our -- you are talking about our pipeline, I think you have got PCSK9 which is we will arrive at the market, we expect roughly at the same time as the other major competitors in that with outcomes data.

We have palbo, we have all the trials around palbo, Prevnar 13 adult. We have got the mening B. We have got the SGLT2 ertugliflozin with Merck. We have the Xeljanz life extensions around that.

Around that continuing growth in Eliquis, continuing growth in Xeljanz, continuing growth in Oncology portfolio and in Inlyta and Xalkori, some very good fast following products in Oncology that could come to market, given we think they are very differentiated.

So frankly opportunities abound inside our Company both from the inline portfolio, the emerging markets opportunities, the pipeline recent launches and to be launched and then if you look at the sort of across of vaccines, Oncology and give a very nice portfolio of unique opportunities.

So, as I say, we're doing this because we see an opportunity create additional value from this acquisition or combination not because we feel any negativity towards our present strategy which we feel is very strong. Okay, thank you..

Thank you everybody for your time today..

Thanks everybody..

Ladies and gentlemen, this does conclude the Pfizer's first quarter 2014 earnings conference call. Thank you for participating. You may now disconnect..