Jon Stewart: "Wye-Phi Deal Gives Me An Itch"

If a deal goes through, the world's biggest drugmaker would see its revenue jump 50 percent and its profit climb, said Stewart on his well-regarded Comedy Central show -- "but the Wye-Phi deal would only be a short term fix."

"Wye-Phi still doesn't resolve the fundamental flaw in the large-pharma model,'' Stewart said, referring to companies relying on blockbusters and narrowing research rather than forging lots of partnerships with small biotech firms and academic researchers to develop as many compounds as possible.

Analysts say Pfizer, the maker of impotence drug Viagra and overactive bladder treatment Detrol, needs to do something dramatic to compensate for a revenue crash starting in November 2011. That's when the world's top-selling drug, $13 billion-a-year cholesterol fighter Lipitor, is expected to face generic competition.

On Friday, shares of Wyeth rose $4.91, or 12.6 percent, to $43.74. Pfizer shares were down most of the day but closed up 24 cents at $17.45.

Analysts said Friday that getting financing could be a big hurdle -- it would have to be a cash-and-stock deal, with Pfizer still likely to have to borrow billions -- and the Federal Trade Commission might require the companies to divest some products.

Pfizer is facing an expected loss of more than 70 percent of its 2007 revenue by 2015.

Its run of iconic blockbusters -- Viagra, Lipitor, antidepressant Zoloft, plus blood-pressure blockbuster Norvasc -- is a fading memory and its research labs have been so unproductive that it closed its mammoth research lab in Ann Arbor, Mich., about a year ago. Pfizer's stock price is barely one-third of its July 2000 peak of $48.

But boosters of the Wye-Phi deal contend that acquiring Wyeth would transform Pfizer almost overnight from primarily a pure pharmaceutical company into a broadly diversified health care giant, given Wyeth's huge presence and revenue in biotech drugs, vaccines including the blockbuster pneumococcal vaccine Prevnar, veterinary medicines and consumer health products from Advil to Robitussin.

And Wyeth's stable of consumer products -- including household names such as Chap Stick, Centrum vitamins, pain reliever Anacin and Preparation H -- is nearly as valuable as the iconic brands Pfizer sold to Johnson & Johnson three years ago when it chose to get out of consumer health and focus on pharmaceuticals. Many analysts have called that a mistake.