Our Voice in the Political Process Learn which candidates Pfizer PAC supported in your community PFIZER PAC BIENNIAL REPORT 2001-2002 Pfizer is poised to do more for healthcare than any other company in history. Every day, state and federal governments make decisions that affect Pfizer and our business operations. Patent restrictions, importation, anti-DTC and marketing regulations, supplemental rebates and preferred drug lists are just a few examples of the challenges we are facing. With political decisions increasingly taking on greater importance, Pfizer needs to ensure that our voice is heard when officials consider crucial pieces of legislation. Your voice is a critical part of the policy debate that affects your company. As we have seen in past elections, each and every one of us plays a vital role in shaping our world, our environment and our communities – by taking the time to vote, whatever our political affiliation. By participating in Pfizer PAC you become a partner with Pfizer’s government affairs team to encourage positive change for the future. Your participation ensures that your voice – and Pfizer’s voice – is heard in the public policy arena. “Your help is sorely needed. While we can all take pride at being the leader in the pharmaceutical industry, we are not the industry leader when it comes to supporting candidates who value our industry. Eli Lilly and GlaxoSmithKline raise far more than Pfizer and have higher employee participation levels in their PACs. Our urgent goal is to increase the PAC from its current $1.3 million to $3 million for the next election cycle, and to raise employee participation rates from 10% to 25%.” Hank McKinnell Chairman & CEO, Pfizer Inc WHY DOES PFIZER NEED A PAC? Simply put, federal law prohibits corporations from making political contribu- tions to federal candidates. However, corporations are allowed to establish political action committees, which are funded solely through voluntary employee contributions. Pfizer’s ability to support candidates, therefore, depends entirely upon Pfizer PAC’s success in raising money from you and your colleagues. WHY IS EVERY ELIGIBLE EMPLOYEE BEING ASKED TO JOIN PFIZER PAC? A voluntary contribution from all eligible employees will create a generous pool of funds with which to support candidates who shape federal and state government policies affecting our industry. Federal and state legislation and regulation directly impact the financial well being of our company. Pfizer needs to be able to fully participate in the electoral process; therefore, we need all eligible employees to make a voluntary contribution to Pfizer PAC. 2 PAC DISBURSEMENTS FOR 2001-2002 ELECTION CYCLE In the 2001-2002 election cycle the Pfizer PAC supported 211 Congressional candidates of whom 72% were Republicans and 28% were Democrats. Pfizer PAC and corporate contributions were made to a total of 1,182 state and local candidates during the 2001-2002 election cycle, consisting of 58% Republicans, PAC BIENNIAL REPORT PAC 40% Democrats and 2% Independents. 2001-2002 PFIZER WHAT IS PFIZER PAC? Pfizer PAC is a nonpartisan organization that provides opportunities for you to participate in the American political process. By partici- pating in the political action committee (PAC), you help elect candidates who share your views. The Pfizer PAC is an employee- STATE CORPORATE POLITICAL CONTRIBUTIONS In 29 states it is legal for a corporation to contribute to state election campaigns. In these states, contributions to candidates for state offices generally come from corporate funds. WHY JOIN PFIZER PAC? Pfizer PAC is based upon the principle that if you want policy decisions to reflect your concerns, you need to become involved in the election of those people who make the decisions. Contributing to the PAC with fellow employees gives you a stronger voice and say in who gets elected. Every day, elected officials across the nation make decisions that affect Pfizer and its business operations. By becoming a PAC contributor, you reaffirm your commitment to be an active participant in the election process and help protect Pfizer’s business interests. Your participation ensures that your voice will be heard and opinion valued. 3 Joining the PAC is easy, all one needs to do is simply fill out an enrollment card or go to the PAC website at www.epacweb.com/Pfizer. Pfizer PAC is a voluntary program. You may contribute whatever you wish. You may contribute in the form of a payroll deduction or in a lump sum, up to the $5,000 annual maximum permitted by law. Whether or not you decide to PAC BIENNIAL REPORT PAC participate in the PAC, or the amount you may contribute, will not affect your 2001-2002 PFIZER run organization with a steering committee the presence of Pfizer facilities or employees made up of Pfizer employees from around in the candidate’s district or state. The PAC the country. When choosing to make a con- steering committee reviews and approves all tribution to a candidate, the Pfizer PAC recommendations for PAC contributions on a considers candidates’ views on issues that monthly basis. impact Pfizer and our employees as well as employment status. Contributions to the Pfizer PAC are not tax deductible as charitable contributions for Federal income tax purposes. Additionally, if required by law, the amount of your contribution, together with your name, address, occupation and employer will be publicly disclosed. PFIZER PAC LEADERSHIP COUNCIL In 1998, Pfizer PAC established the Pfizer PAC Leadership Council. The Leadership Council is based upon the premise that if you want policy decisions to reflect your concerns, you need to become involved in the election of those people who make important decisions. By contributing $500 or more per year to the Pfizer PAC, you will be a member of the Pfizer PAC Leadership Council. Whether you choose to join the PAC Leadership Council, prefer to join with a smaller amount to the PAC, or not join at all, is up to you and will not affect your employment status. 4 PAC BIENNIAL REPORT PAC "For the past several years, some candidates and elected officials have spent an enormous amount of time and money attacking our industry. Some attack the industry because they want to see government run health care, while others find us 2001-2002 PFIZER an inviting target because they feel we are unable to respond to their attacks. Patent protection, direct-to-consumer advertising restrictions, price controls, preferred drug lists, supplemental rebates and personal injury lawsuits are just a few of the many issues being debated in Congress and our state capitols across the country. By joining the PAC, you can help Pfizer make our voice heard and have a real impact on government decision-making." Chuck Hardwick Senior Vice President, Worldwide Government & Public Affairs WHO PICKS THE CANDIDATES WHO RECEIVE PFIZER PAC MONEY? The Pfizer PAC Steering Committee, made up of employees from different facilities around the country, oversees the evaluation of candidates for the Pfizer PAC to support. When selecting candidates for funding, Pfizer PAC gives priority to the following: Candidates’ views on matters of concern to Pfizer and its employees, The presence of Pfizer employees or facilities in a candidate’s state or district, In the case of incumbents, a candidate’s proven legislative leadership and ability, A candidate’s commitment to improving the pharmaceutical industry climate. CAMPAIGN FINANCE REFORM In 2002, President Bush signed campaign finance reform legislation into law. Does this mean that corporations no longer have a role in making political contributions? The campaign finance reform legislation that passed went into effect on November 6, 2002 and bans corporations from contributing corporate 5 funds to political parties such as the Democratic National Committee and the Republican National Committee. Typically, these contributions pay for Get- Out-The-Vote drives and/or ads to promote one party’s candidate over another. The ban on activities funded by corporate contributions makes it crucial that we increase participation in the Pfizer PAC. The additional PAC funds raised PAC BIENNIAL REPORT PAC will offset the recently enacted limits on corporate political activity as well as support and enhance Pfizer’s direct and field based lobbying efforts. 2001-2002 PFIZER COMMITTEES POLITICAL CONTRIBUTIONS PFIZER PAC POLICY COMMITTEE STEERING COMMITTEE Chairman Member Chuck Hardwick Dan Collier Senior Vice President, Worldwide Vice President, Government & Public Affairs Sales Specialty Division New York, NY Treasurer Richard Passov Member Vice President & Treasurer Forest Harper Vice President, Secretary Pfizer for Living Share Card George Evans Program, Pharmaceuticals Senior Assistant General Counsel Headquarters New York, NY Member Rich Bagger Member Senior Vice President, John Keenan Government Relations Public Affairs 6 PGRD Member Ann Arbor, MI Ken Bowler Vice President, Member Government Relations Gary Platt Director/Team Leader Member Information Technology Jeff Kindler Parsippany, NJ Senior Vice President PAC BIENNIAL REPORT PAC & General Counsel Member Philip Rose Member Director of Distribution, Robert Mallett Pfizer Global Manufacturing Senior Vice President, Memphis, TN Corporate Affairs 2001-2002 PFIZER Member Mike Taylor Senior Vice President, PGRD Global Project Management Groton, CT Member Cheryl Wood Order Fulfillment Manager, Pfizer Global Manufacturing Reno, NV PARTY DISTRICT PAC CORP. ALABAMA SENATE W Sen. Jeff Sessions R 3,000 STATE Sen. William C. Armistead Jr. R 750 W Rep. Scott Beason R 51 500 W Sen. Roger H. Bedford D 6 1,000 W Rep. Robert Bentley R 63 500 W Sen. Steve French R 15 500 W Rep. Victor Gaston R 100 500 W Rep. Laura Hall D 19 500 W Rep. Albert Hall D 22 500 W Rep. Seth Hammett D 92 500 W Rep. Allen W. Layson D 61 250 W Rep. Michael J. Millican D 17 1,000 W Attorney General Bill Pryor R 500 W Governor Bob Riley R 500 Rep.