Pfizer to acquire Wyeth

US drugmaker Pfizer is to buy rival Wyeth in a deal worth $68 billion, making it the biggest merger announced on Wall Street since the credit crunch and creating what both companies call "the worldÔÇÖs premier biopharmaceutical company."┬á  The acquisition will also be the largest merger in the pharmaceutical industry since Pfizer purchased Warner-Lambert for $93.4 billion in 2000. ┬á  From 2011, Pfizer, maker of Viagra, is expected to lose billions of dollars in sales to cheaper rival generics of its cholesterol treatment Lipitor, and Wyeth faces the same problem next year, as it will lose patent protection on its best-selling antidepressant Effexor XR. ┬á "With our combined biopharmaceuticals business, it will lead in primary and specialty care as well as in small and large molecules," said Jeffrey Kindler, chairman and chief executive of Pfizer, who will run the new company.  ┬áThe merger will allow Pfizer, the worldÔÇÖs largest drug firm, to protect itself from a decline in revenues when Lipitor and other products lose patent protection, and thanks to WyethÔÇÖs presence in biotech drugs and vaccines the acquisition will also help Pfizer diversify its product portfolio.┬á  Wyeth president and CEO Bernard Poussot said, ÔÇ£Wyeth and Pfizer are highly complementary businesses, and together we can build the best diversified health care company in the world.┬á We believe we can better execute our strategy and can accomplish far more together in the years ahead than either company could have achieved on its own.ÔÇØ ┬á The deal will also allow the two companies to cut cost by cutting jobs in overlapping areas, as drug spending is expected to come under pressure with government attempts to reduce the cost of medical care. ┬á Pfizer has raised $22.5 billion from banks to finance the deal and said it will reduce dividends "in connection with the proposed transaction between Pfizer and Wyeth". ┬á "Deals of this quality and this magnitude will rekindle enthusiasm and hope about equity markets," said Andre Bakhos, Princeton Financial Group president, but analysts disagreed on whether the deal might lead to other mergers in the sector.┬á┬á "I wouldn't extrapolate this deal and say we're going to see a lot more deals because it's still a difficult financing environment," said Peter Boockvar, equity strategist at Miller Tabak & Co.