Zyprexa

(Risinger or one of his associates own the shares of Pfizer and Merck; Merrill Lynch has investment-banking relationships with Pfizer, Merck, Eli Lilly, Schering-Plough and Wyeth.) Monday's gain couldn't quite lift Pfizer into the plus column for 2005.

Its shares had fallen 16% through Friday on declining sales of drugs like Celebrex for arthritis, and on concern over the company's thin research pipeline and looming patent expirations.

Pfizer will lose exclusivity on Zoloft in June 2006.

The antidepressant accounted for $2.7 billion in U.S.

sales in 2004, or about 5.1% of domestic revenue.

Pfizer also loses exclusivity on Xanax XR, an antianxiety drug, in January, and on Fragmin, a treatment for blood-vessel clotting, next December.

"Pfizer is becoming a value play," says Rauch.

"You're certainly not expecting a lot of growth in the future." The stock trades at 13 times Reuters Research's 2005 earnings consensus of $1.94, vs.

an average price/earnings ratio of 21 for drug makers.

The 2005 consensus stands 8% below the company's 2004 earnings of $2.12 a share.

In 2006 the company is expected to earn $2.03 a share.

Quote: "Part of what people were worried about was that historically generic companies were successful i...

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