Pfizer's weak drug pipeline fuels hunger for AstraZeneca

At the heart of Pfizer Inc's (PFE) pursuit of British drugmaker AstraZeneca Plc (AZN.L) is a shortage of attractive products in its own research pipeline, aggravated by a recent series of disappointing drug launches, according to some industry analysts and money managers. They view the $100-billion gambit for AstraZeneca as a return by Pfizer to the "mega-mergers" of the previous decade that allowed the U.S. company to benefit from huge cost savings and divert shareholder concern over low returns from its research and development. As recently as last year, Pfizer Chief Executive Ian Read had virtually sworn off major dealmaking, wary of the criticism that huge transactions, such as the $90 billion purchase of Warner-Lambert in 2000, had not improved the company's prospects for innovative products. "Pfizer is doing this from a position of weakness," said Michael Liss, a portfolio manager at American Century Investments who holds Pfizer shares.

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