Pfizer's third-quarter revenues declined 3 percent to $11.6 billion, but were still above analyst estimates of $11.4 billion. Executives were quick to point out that revenues suffered by approximately 5 percent due to foreign exchange conversions. Operating revenues increased 2 percent.

It's also interesting to see the impact resulting from different health insurance systems around the world. While the economic recession has been global, sales actually grew 5 percent operationally in Europe due to mostly public health care there. In the U.S., rising unemployment meant lost health insurance and led more consumers to opt for generic drugs, if they could afford them. That led to revenues decreasing 2 percent in the U.S. Pfizer itself would be responsible for adding 20,000 people to the unemployment line by the time integration with Wyeth is complete.

The drugmaker also upped its fourth-quarter guidance to reflect Wyeth's impact. It expects earnings per share of $1.45 to $1.50 for all of 2009, up from prior guidance of $1.30 to $1.45 per share. Pfizer is pegging revenue to be $49 billion to $50 billion, up from $45 billion to $46 billion, because Pfizer will record revenue from Wyeth's products for only part of the fourth quarter. It will give a forecast for 2010 when it reports the current quarter in January.

"Excluding foreign exchange," Kindler said, "our five Pharmaceutical units and Animal Health business continued to perform well enabling us to continue to meet our commitments." Translation: Sales were down in several business divisions, with the worst decline -- 12 percent -- in the established-products business, which sells drugs that lost patent protection in at least one region and face generic competition (for example, Norvasc for blood pressure and Relpax for migraine).

Of course, an ongoing concern regards Pfizer's top blockbusters that are going to face generic competition as they lose patent protection in the next few years. And that's where the limits of cost-cutting come in. At some point, there has to be growth.

For example, Pfizer's Lipitor cholesterol drug is selling at over $12 billion annually and is responsible for a quarter of company revenue. But it's set to lose patent protection and face generics in 2011. And its sales have already declined 9 percent to $2.8 billion. Norvasc, Chantix anti-smoking drug (which was hit with an FDA warning recently), and a few others saw sales fall-offs in the double digits. Viagra sales dropped 8 percent, and pain drug Celebrex slid 4 percent, to name a few others. The exceptions are the Lyrica pain drug, Sutent oncology drug and Genotropic endocrine treatment. Outside the U.S., Lyrica grew 35 percent and Sutent 21 percent on a constant-dollar basis.

To offset the upcoming lost revenue from Lipitor, Pfizer decided to acquire Wyeth. On the conference call, Kindler said the deal makes Pfizer more diversified in its product portfolio with vaccines, biotechnology drugs, animal health, nutrition and consumer health-care products. Wyeth's pipeline includes some late-stage experimental drugs in Alzheimer, oncology and pain management. The integration plans, he added, have been carefully crafted to continue the R&D, sales and marketing and manufacturing operations smoothly as well as enhance shareholders' value. "All told, this quarter's results show that Pfizer is on the right track. The acquisition strengthens Pfizer," he said.

As for Pfizer's long-term goals, management explained that greater scale brings benefits in certain markets and for large clinical trials, but it can create impediments, as in doing innovative research. Pfizer is currently organizing into smaller units that, for now, benefit from being part of a big company. But executives also said Pfizer will always look at the mix of assets with the aim of maximizing shareholder value. And if they decide it would be better to split up the company into separate, smaller, publicly traded entities, they would do so.

After the Wyeth merger, Pfizer will have 15 percent nonpharma assets, which isn't nearly as much as Johnson & Johnson (JNJ) and Abbott (ABT). Asked whether Pfizer intends to expand its nonpharma assets, executives said they definitely set them up to grow, not to be sold and that they look at the animal health unit -- now among the world's largest -- to get bigger.

Pfizer also says its pipeline is much stronger with Wyeth and that it's leading to more submissions for FDA approvals. The company expects at least four compounds to reach the market in 2010-2011. While it acknowledges that there are always setbacks -- such as the recent one with its experimental lung-cancer compound figitumumab, where safety concerns led to a halt in patient enrollments fo a late stage clinical trial -- it still experiments with a number of products, including Sutent. Oncology, especially, is a high-risk/high-reward field. Pfizer thinks it has now a robust oncology business with 22 products in development -- certainly the strongest it's been in a while .

Pfizer now needs to integrate Wyeth's operations, deal with an approaching "patent cliff," manage and expand its new pipeline and find more avenues for growth. Perhaps by demonstrating it can manage through tough times, it will increase investors' confidence about its ability to do the rest.