PFIZER INC, DEF 14A, 1996-03-19

PFIZER INC
DEF 14A, 1996-03-19
PHARMACEUTICAL PREPARATIONS

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<PAGE>

Pfizer Inc
235 East 42nd Street
New York, NY 10017-5755

---------------------------------------

[LOGO]

WILLIAM C. STEERE, JR.
Chairman of the Board and
Chief Executive Officer

March 19, 1996

Dear Fellow Shareholder:

You are cordially invited to attend the Annual Meeting of Shareholders of Pfizer
Inc. which will be held on Thursday, April 25, 1996 at 10:00 a.m. in the Empire
State Ballroom of the Grand Hyatt Hotel, 42nd Street and Lexington Avenue, New
York, NY. Directions to the meeting site and a map of the meeting site area can
be found at the end of the attached Proxy Statement.

This booklet includes the Notice of the Annual Meeting of Shareholders and the
Proxy Statement. The Proxy Statement describes the business that will be
transacted at the Annual Meeting and also provides important information about
the Company and the items to be voted upon that you should consider when you
vote your shares.

At this year's meeting, among other things, you will be asked to consider and to
vote upon the election of three directors. All three nominees currently are
directors of the Company. Their diversified experience and backgrounds have
enabled them to contribute significantly to the success of the Company.
Accordingly, your Board of Directors recommends that you vote FOR all of the
nominees.

You also will be asked to approve the Board of Director's appointment of KPMG
Peat Marwick LLP as the Company's independent auditors for the 1996 fiscal year.
Your Board of Directors considers the firm well qualified for this position and
therefore recommends that you vote FOR this proposal.

In addition, you will be asked to approve amendments to the Pfizer Inc. Stock
and Incentive Plan to increase the number of shares of Pfizer Inc. common stock
authorized for issuance under the Plan and to extend the term of the Plan
through the year 2005. This Plan initially was approved by the Company's
shareholders in 1965 and awards made under the Plan since then have been an
important part of the Company's employee compensation program. The availability
of additional shares for use pursuant to the Plan will allow the Company greater
flexibility in its employee compensation and performance incentive program. The
Board therefore recommends that you vote FOR this proposal.

EACH OF THE ITEMS UPON WHICH YOU WILL BE ASKED TO VOTE IS DISCUSSED MORE FULLY
IN THE ATTACHED PROXY STATEMENT. WE URGE YOU TO READ THE PROXY STATEMENT
COMPLETELY AND CAREFULLY SO THAT YOU CAN VOTE YOUR SHARES ON AN INFORMED BASIS.

Your vote is important! We look forward to receiving your proxy form and hope
that you will be able to join us at the Annual Meeting.

Sincerely yours,

[SIGNATURE]
William C. Steere, Jr.

<PAGE>
PFIZER INC.

235 EAST 42ND STREET, NEW YORK, NY 10017

NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS

APRIL 25, 1996
------------------

The Annual Meeting of Shareholders of Pfizer Inc., a Delaware corporation
(the "Company"), will be held in the Empire State Ballroom of the Grand Hyatt
Hotel, 42nd Street and Lexington Avenue, New York, NY. Directions to the meeting
site and a map of the meeting site area can be found at the end of the attached
Proxy Statement. The Annual Meeting of Shareholders will be held on Thursday,
April 25, 1996, at 10:00 a.m., to consider and take action upon the following
items:

(1)the election of three directors (page 2);

(2)a proposal to approve the appointment of KPMG Peat Marwick LLP as
independent auditors of the Company for the 1996 fiscal year (page 23);

(3)a proposal to approve amendments to the Pfizer Inc. Stock and Incentive
Plan to increase the number of shares of Pfizer Inc. common stock
authorized to be issued under the Plan and to extend the term of the Plan
to December 31, 2005 (page 24); and

(4)such other business as may properly come before the Annual Meeting, or
any adjournment thereof.

Only shareholders of record as of the close of business on February 26, 1996
are entitled to notice of and to vote at the Annual Meeting of Shareholders.
Beneficial owners of Company common stock who are not shareholders of record,
but instead hold their shares in nominee names, must bring evidence of such
ownership (such as a brokerage account statement showing ownership of Company
common stock) to be admitted to the Annual Meeting of Shareholders.

By order of the Board of Directors,

[SIGNATURE]
C. L. Clemente
SECRETARY

New York, NY
March 19, 1996

IMPORTANT

WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING OF SHAREHOLDERS IN
PERSON, PLEASE VOTE BY MEANS OF THE ENCLOSED PROXY FORM. WE ASK YOU TO MARK
YOUR CHOICES, SIGN, DATE AND RETURN THE PROXY FORM AS SOON AS POSSIBLE IN
THE ENCLOSED BUSINESS REPLY ENVELOPE. IF YOU RETURN A SIGNED PROXY FORM
WITHOUT MARKING IT, IT WILL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATIONS
OF THE BOARD OF DIRECTORS. BY PROMPTLY SIGNING AND RETURNING YOUR PROXY FORM
YOU WILL ASSIST THE COMPANY BY REDUCING EXPENSES RELATING TO ADDITIONAL
PROXY SOLICITATIONS.
<PAGE>
PFIZER INC.
235 EAST 42ND STREET, NEW YORK, NY 10017
PROXY STATEMENT

March 19, 1996

This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Pfizer Inc. (the "Company") of proxies for use at the
Company's Annual Meeting of Shareholders to be held on April 25, 1996 ("Annual
Meeting"), or any adjournment thereof. Holders of record of shares of Company
common stock ("Common Stock") at the close of business on February 26, 1996 (the
"Record Date") are entitled to vote at the Annual Meeting and each shareholder
will have one vote for each share of Common Stock registered in his or her name.
On the Record Date, there were issued and outstanding and entitled to vote at
the Annual Meeting 639,181,479 shares of Common Stock. As of the Record Date, to
the Company's knowledge, no person owned beneficially five percent or more of
the outstanding shares of Common Stock.

This Proxy Statement and enclosed proxy form are first being mailed to the
Company's shareholders on or about March 19, 1996.

QUORUM AND TABULATION OF VOTES

The By-laws of the Company (the "By-laws") provide that a majority of the
shares of Common Stock issued and outstanding and entitled to vote, present in
person or by proxy, shall constitute a quorum at a meeting of shareholders of
the Company.

Votes at the Annual Meeting will be tabulated by two independent judges of
election appointed by the Company. Shares of Common Stock represented by a
properly signed and returned proxy are considered as present at the Annual
Meeting for purposes of determining a quorum.

Pursuant to the By-laws, directors of the Company must be elected by a
plurality vote. In the event that more than two candidates run for the same
office, a plurality vote ensures that the person elected will be the one who
receives the greatest number of votes, even if that number does not constitute a
majority of the votes cast. Pursuant to the By-laws, all other questions shall
be determined by a majority of the votes cast thereon, except as may otherwise
be provided in the Certificate of Incorporation of the Company, by the rules of
the New York Stock Exchange, or by law.

Brokers holding shares of Common Stock for beneficial owners must vote those
shares according to the specific instructions they receive from the owners. If
specific instructions are not received, however, brokers may vote those shares
at their discretion, depending on the type of proposal involved. The rules of
the New York Stock Exchange preclude brokers from exercising their voting
discretion on certain proposals. Absent specific instructions from the
beneficial owner in such a case, the broker may not vote on that proposal. This
results in what is known as a "broker non-vote" on such a proposal. When a
majority of the shares of Common Stock issued and outstanding is required for
approval of a proposal, a "broker non-vote" has the effect of a negative vote.
When a majority of the shares of Common Stock present and entitled to vote or a
majority of the votes cast is required for the approval of a proposal a "broker
non-vote" has the effect of reducing the number of required affirmative votes.

<PAGE>

Directors will be elected by a favorable vote of a plurality of the shares
of Common Stock cast with respect to the election of directors (Item 1) at the
Annual Meeting. Votes "withheld" from director-nominee(s) will not count against
the election of such nominee(s). Brokers have discretionary authority to vote on
this proposal.

Passage of the proposal to approve the appointment of KPMG Peat Marwick LLP
(Item 2) requires the approval of a majority of the votes cast on this proposal.
Abstentions as to this proposal will not count as votes cast "for" or "against"
this proposal and will not be included in calculating the number of votes
necessary for approval of this proposal.

Passage of the proposal to approve amendments to the Company's Stock and
Incentive Plan to increase the number of shares of Common Stock authorized to be
issued under the Plan and to extend the term of the Plan to December 31, 2005
(Item 3) requires the approval of a majority of the shares of Common Stock
issued and outstanding. Abstentions and broker non-votes as to this proposal
will have the same effect as a vote cast "against" the proposal. The New York
Stock Exchange determines whether brokers have discretionary authority to vote
on a given proposal.

If a properly signed proxy form is returned to the Company by a shareholder
of record and is not marked, it will be voted in accordance with the
recommendations of the Board on all proposals.

A shareholder of record may revoke a vote at any time before the Annual
Meeting by the submission of a written revocation of the proxy to the Company,
by the return of a subsequently-dated proxy form to the Company, or by the
shareholder's personal vote at the Annual Meeting.

ITEM 1 -- ELECTION OF THREE DIRECTORS

During 1995, the Company's Board of Directors ("Board") met eleven times.
All of the Company's directors attended seventy-five percent or more of the
meetings of the Board and Board committees on which they served in 1995.

The Board is divided into three classes. One class is elected each year for
a three-year term. This year the Board has nominated three individuals, all of
whom are now directors of the Company, to serve for three-year terms.
Biographies of the nominees and the other members of the Board are set forth
below. The Board unanimously recommends that shareholders vote "FOR" the three
nominees for directors.

The Board expects that all of the nominees will be available for election.
In the event that any nominee should become unavailable, however, the Proxy
Committee (as noted on the proxy form) shall vote for a nominee or nominees who
would be designated by the Board, unless the Board chooses to reduce the number
of directors serving on the Board.

SECURITY OWNERSHIP OF MANAGEMENT

As of February 22, 1996, the nominees, other directors, and certain
executive officers of the Company who are not directors of the Company, as named
in the following table, according to information confirmed by them, owned
beneficially, directly or indirectly, the number of shares of Common Stock
indicated; held options, exercisable within 60 days after that date, to purchase
the number of shares of Common Stock indicated pursuant to the Company's Stock
and Incentive Plan; and held the number of units indicated pursuant to the
Company's Nonfunded Deferred Compensation and Unit Award Plan for Non-Employee
Directors. As of such date, no such person beneficially owned more than .13
percent of the outstanding Common Stock; all directors and executive officers as
a group owned 1,889,697 shares of Common Stock, and options, exercisable within
60 days after that date, to purchase 2,329,621 shares of Common Stock, which
together amounted to less than one percent of the outstanding Common Stock. As
of February 22, 1996, no director or executive officer owned any of the
Company's convertible debentures.

2
<PAGE>

Constance J. Horner............54 Guest Scholar since 1993 at The Brookings Institution, Shares: 2,992
an organization devoted to nonpartisan research, Units: 609
education and publication in economics, government and
foreign policy and the social sciences. Commissioner,
U.S. Commission on Civil
Rights since 1993. Served at the White House as
[PHOTO] Assistant to the President and as Director of Presi-
dential Personnel from August 1991 to January 1993.
Deputy Secretary, U.S. Department of Health and Human
Services, from 1989 to 1991. Director of the U.S.
Office of Personnel Management from 1985 to 1989.
Director of Ingersoll-Rand and The Prudential Insurance
Co. of America. Director of the Company since 1993.
Member of the Company's Corporate Governance Committee.

Thomas G. Labrecque............57 Chairman and Chief Executive Officer and a Director of Shares: 3,400
The Chase Manhattan Corporation, a bank holding Units: 609
company, and The Chase Manhattan Bank, N.A. since 1990.
President of The Chase Manhattan Corporation and The
Chase Manhattan Bank,
N.A. from 1981 to 1990. Member of the Business
[PHOTO] Roundtable, the Council on Foreign Relations, the
Council on Competitiveness and the Trilateral
Commission. President of The Bankers Roundtable and the
International Monetary Conference. Director of the
Company since 1993. Member of the Company's Executive
Compensation Committee.

Jean-Paul Valles...............59 Chairman of Minerals Technologies Inc. ("MTI"), a Shares: 131,530
resource and technology-based company that develops, Options: 66,000
produces and markets specialty mineral, mineral-based Units: 5,338
and synthetic mineral products, since 1989. Chief
Executive Officer of MTI since
1992. Formerly Vice Chairman of the Company from March
[PHOTO] to October 1992. Executive Vice President of the
Company from 1991 to 1992. Senior Vice President of the
Company from 1989 through 1991. Senior Vice President
-- Finance of the Company from 1989 to 1990 and Vice
President -- Finance of the Company from 1980 to 1989.
Director of the Company since 1980.
</TABLE>

- --------------------------

(1) This table does not include the following number of shares held in the names
of family members, as to which beneficial ownership is disclaimed: Dr.
Valles -- 29,020.

(2) As of February 22, 1996, these units are held under the Pfizer Inc.
Nonfunded Deferred Compensation and Unit Award Plan for Non-Employee
Directors. The value of a director's unit account is measured by the price
of the Common Stock. The Plan is further described in this Proxy Statement
under the sub-heading "Benefit Plans for Non-Employee Directors."

3
<PAGE>

<TABLE>
<CAPTION>
AMOUNT OF BENEFICIAL
OWNERSHIP OF SHARES
OF
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION, COMMON STOCK, (1)
APRIL 25, 1996 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS OPTIONS AND UNITS (2)
- --------------------------------- ------------------------------------------------------- ---------------------
<S> <C> <C>
DIRECTORS WHOSE TERMS EXPIRE IN 1997
M. Anthony Burns...............53 Chairman of the Board since 1985, Chief Executive Shares: 3,400
Officer since 1983, President and Director since 1979, Units: 609
of Ryder System, Inc., a provider of transportation and
logistics services in the Americas and Western Europe.
Director of The Chase Manhattan
Bank, N.A., The Chase Manhattan Corporation and J.C.
[PHOTO] Penney Company, Inc. Member of the Business Roundtable
and the Business Roundtable's Policy Committee and
Chairman of its Health, Welfare and Retirement Income
Task Force. Director of the Company since 1988. Chair
of the Company's Executive Compensation Committee.
George B. Harvey...............65 Chairman, President, and Chief Executive Officer since Shares: 3,081
1983 and Director since 1980 of Pitney Bowes, a Units: 3,039
provider of mailing and office systems and management
and financial services. Director of Connecticut Mutual
Life Insurance Company,

McGraw-Hill, Inc., and Merrill Lynch & Co., Inc.
[PHOTO] Director of the Company since 1994. Member of the
Company's Executive Compensation Committee.
Stanley O. Ikenberry...........61 President Emeritus and Regent Professor of the Shares: 6,496
University of Illinois, a comprehensive public re- Units: 14,857
search university with campuses at Urbana-Champaign and
Chicago. President of the University from 1979 through
July 1995. Director of Harris

Bank, Utilicorp United Inc. and the Chairman of the
[PHOTO] Board of Carnegie Foundation for the Advancement of
Teaching. Director of the Company since 1982. Chair of
the Company's Audit Committee.
Franklin D. Raines.............47 Vice Chairman since 1991 of Fannie Mae (Federal Shares: 1,200
National Mortgage Association), a company that provides Units: 4,271
a secondary market for residential mortgages through
portfolio purchases, issuance of mortgage-backed
securities, and other services.
General Partner in municipal finance at the investment
[PHOTO] banking firm of Lazard Freres & Co. LLC from 1985-1990.
Director of Fannie Mae and The Boeing Company. Director
of the Company since 1993. Member of the Company's
Audit Committee.
</TABLE>

- --------------------------

(1) This table does not include the following number of shares held in the names
of family members, as to which beneficial ownership is disclaimed: Dr.
Ikenberry -- 3,000.

4
<PAGE>

<TABLE>
<CAPTION>
AMOUNT OF BENEFICIAL
OWNERSHIP OF SHARES
OF
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION, COMMON STOCK,
APRIL 25, 1996 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS OPTIONS AND UNITS (1)
- --------------------------------- ------------------------------------------------------- ---------------------
<S> <C> <C>
DIRECTORS WHOSE TERMS EXPIRE IN 1998
Grace J. Fippinger.............68 Vice President, Secretary and Treasurer from 1984 Shares: 8,282
through 1990 of NYNEX Corporation, an exchange Units: 600
telecommunications and exchange access services
company. Director of the Bear Stearns Compa-

nies, Inc. Director of the Company since 1976. Member
[PHOTO] of the Company's Executive Committee and Corporate
Governance Committee.
James T. Lynn..................69 Senior Advisor to Lazard Freres & Co. LLC, Investment Shares: 7,000
Bankers, since 1992. Chairman and Chief Executive Units: 609
Officer of Aetna Life and Casualty Company from 1984 to
1992 and Director from 1979 to 1992. Director of TRW
Inc. Director of the Compa-

[PHOTO] ny since 1979. Member of the Company's Corporate
Governance Committee. Chair of that Committee from 1986
through January 1995.
Paul A. Marks..................69 President and Chief Executive Officer since 1980 of Shares: 5,462
Memorial Sloan-Kettering Cancer Center, a private Units: 44,960
health care institution devoted to cancer prevention,
patient care, research and education. Di-
rector of several Dreyfus Mutual Funds, Life Tech-
[PHOTO] nologies, Inc. and Tularik Inc. Director of the Com-
pany since 1978. Chair of the Company's Corporate
Governance Committee and member of the Company's
Executive Committee.
</TABLE>

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(1) As of February 22, 1996, these units are held under the Pfizer Inc.
Nonfunded Deferred Compensation and Unit Award Plan for Non-Employee
Directors. The value of a director's unit account is measured by the price
of the Common Stock. The Plan is further described in this Proxy Statement
under the sub-heading "Benefit Plans for Non-Employee Directors."

5
<PAGE>

of New York, serving from 1975 to 1993. Director of the
[PHOTO] Company since 1971. Member of the Company's Executive
Committee and Audit Committee.
William C. Steere, Jr..........59 Chairman of the Board of the Company since 1992. Chief Shares: 188,797
Executive Officer of the Company since April 1991. Options: 390,780
President of the Company from 1991 to 1992. Senior Vice
President of the Company from
1989 to 1991. Vice President of the Company from 1983
[PHOTO] to 1989, and President -- Pharmaceuticals Group from
1986 through January 1991. Director of the Federal
Reserve Bank of New York, Minerals Technologies Inc.,
Pharmaceutical Research and Manufacturers of America
(PhRMA) and Texaco Inc. Member of the Business
Roundtable. Director of the Company since 1987. Chair
of the Company's Executive Committee.
</TABLE>

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(1) As of February 22, 1996, includes shares credited under the Savings and
Investment Plan to employees of the Company included in this table. The Plan
is further described in this Proxy Statement under the heading "Employee
Benefit and Long-Term Compensation Plans." This table does not include the
following number of shares held in the names of family members, as to which
beneficial ownership is disclaimed: Mr. Pratt -- 60,000.

6
<PAGE>

<TABLE>
<CAPTION>
AMOUNT OF BENEFICIAL
OWNERSHIP OF SHARES
OF
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION, COMMON STOCK, (1)
APRIL 25, 1996 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS OPTIONS AND UNITS
- --------------------------------- ------------------------------------------------------- ---------------------
<S> <C> <C>
NAMED EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Edward C. Bessey...............61 Vice Chairman of the Company from 1992 through 1995.(2) Shares: 92,156
President, U.S. Pharmaceuticals Group from 1992 through Options: 211,504
1995. Executive Vice President of the Company from 1991
to 1992. Senior Vice President of the Company from 1989
to 1991. Vice President of the Company from 1983 to
1989, and President -- Hospital Products Group from
1982 through 1991. Responsible for the Consumer Health
Care Group from 1991 through 1995. Director of The
Green Point Savings Bank. Director of the Company from
1987 through 1995.
Henry A. McKinnell, Jr.........53 Executive Vice President of the Company. Responsible Shares: 50,330
for the Company's U.S. Pharmaceuticals Group, Consumer Options: 185,504
Health Care Group, Corporate Finance Division, and
Corporate Strategic Planning and Policy. Director of
Aviall, Inc.
Robert Neimeth.................60 Executive Vice President of the Company; President of Shares: 112,312
the Company's International Pharmaceuticals Group. Also Options: 199,524
responsible for the Company's Animal Health Group and
the Hospital Products Group.
John F. Niblack................57 Executive Vice President -- Research and Development. Shares: 37,473
Responsible for the Company's Central Research, Drug Options: 121,920
Regulatory Affairs, Licensing and Development and
Quality Control Divisions.
</TABLE>

- --------------------------

(2) Mr. Bessey retired as an employee and resigned as a director of the Company
as of January 1, 1996.

7
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS

The following table sets forth information concerning the compensation
during the last three fiscal years of the Company's Chief Executive Officer and
its next four most highly compensated executive officers serving at the end of
1995 (hereafter referred to collectively as the "Named Executive Officers") for
all services rendered by them to the Company.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
--------------------------------------- -----------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
AWARDS PAYMENTS
------------------------ ---------

<CAPTION>
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING LTIP
NAME AND SALARY BONUS(1) COMPENSATION(2) AWARDS(3) OPTIONS(4) PAYOUTS(5)
PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------- -----------------------------------
W. C. Steere, Jr. ........... 1995 1,030,000 2,060,000 24,560 0 150,000 2,036,250
Chairman/CEO
`` `` `` ............... 1994 1,016,667 1,925,000 20,511 0 78,600 641,000
`` `` `` ............... 1993 1,100,000 800,000 9,614 600,023 75,000 0
- ----------------------------------------------------------------------------------------------------------------------
E. C. Bessey ................ 1995 625,000 620,000 20,236 0 0 733,050
Vice Chairman; President,
U.S. Pharmaceuticals Group
`` `` `` ............... 1994 600,000 606,000 25,800 0 21,750 230,760
`` `` `` ............... 1993 600,000 275,000 16,170 100,023 16,500 0
- ----------------------------------------------------------------------------------------------------------------------
H. McKinnell, Jr. ........... 1995 608,000 720,000 17,350 0 60,000 733,050
Executive V.P.
H. McKinnell, Jr. ........... 1994 528,333 521,000 23,749 0 26,630 230,760
Executive V.P. & CFO;
President -- HPG
`` `` `` ............... 1993 505,000 290,000 16,233 135,020 30,000 0
- ----------------------------------------------------------------------------------------------------------------------
R. Neimeth .................. 1995 574,917 626,000 14,970 0 50,000 610,875
Executive V.P.; President --
International
Pharmaceuticals Group
`` `` `` ............... 1994 497,500 449,000 14,141 0 21,490 192,300
`` `` `` ............... 1993 485,000 245,000 9,427 105,048 15,000 0
- ----------------------------------------------------------------------------------------------------------------------
J. F. Niblack ............... 1995 569,833 615,000 4,123 0 50,000 610,875
Executive V.P. -- Research
and Development
`` `` `` ............... 1994 515,000 432,000 3,701 0 21,450 192,300
`` `` `` ............... 1993 500,000 225,000 0 75,018 25,000 0

<S> <C>

ALL OTHER
NAME AND COMPENSATION(6)
PRINCIPAL POSITION ($)
<S> <C>
- ----------------------------- ---------------
W. C. Steere, Jr. ........... 119,015
Chairman/CEO
`` `` `` ............... 73,253
`` `` `` ............... 64,000
- -----------------------------
E. C. Bessey ................ 206,345
Vice Chairman; President,
U.S. Pharmaceuticals Group
`` `` `` ............... 35,098
`` `` `` ............... 32,600
- -----------------------------
H. McKinnell, Jr. ........... 45,373
Executive V.P.
H. McKinnell, Jr. ........... 32,865
Executive V.P. & CFO;
President -- HPG
`` `` `` ............... 26,600
- -----------------------------
R. Neimeth .................. 41,120
Executive V.P.; President --
International
Pharmaceuticals Group
`` `` `` ............... 29,803
`` `` `` ............... 25,400
- -----------------------------
J. F. Niblack ............... 40,204
Executive V.P. -- Research
and Development
`` `` `` ............... 29,673
`` `` `` ............... 24,000
</TABLE>

- ------------------------------

(1) The amounts shown in this column for 1995 constitute the Annual Incentive
Awards made to each officer based on the Board's evaluation of each
officer's performance. These awards are discussed in further detail in the
Executive Compensation Committee Report on page 11 of this Proxy Statement.

(FOOTNOTES CONTINUED ON NEXT PAGE)

8
<PAGE>

(2) The amounts shown in this column represent tax payments made by the Company
on behalf of the Named Executive Officers relating to their use of Company
automobiles and for personal financial counseling. These payments in 1995
were as follows: relating to use of the Company automobiles -- Mr.
Steere -- $19,757; Mr. Bessey -- $15,491; Dr. McKinnell -- $11,787; and Mr.
Neimeth -- $11,201; relating to receipt of personal financial
counseling -- Mr. Steere -- $4,803; Mr. Bessey -- $4,745; Dr.
McKinnell -- $5,563; Mr. Neimeth -- $3,769; and Dr. Niblack -- $4,123.

(3) The amounts shown in this column represent the dollar values on the date of
grant (February 17, 1994) of the following number of restricted shares of
the Company's Common Stock awarded as part of 1993 compensation: Mr.
Steere -- 10,390 shares; Mr. Bessey -- 1,732 shares; Dr. McKinnell -- 2,338
shares; Mr. Neimeth -- 1,819 shares; and Dr. Niblack -- 1,299 shares. All
such shares of restricted stock have vested or will vest as follows:
one-third on February 17, 1995, one-third on February 17, 1996, and
one-third on February 17, 1997. Dividends will be paid during the restricted
period. The market value of these shares (including those shares that vested
on February 17, 1995 and on February 17, 1996) as of December 31, 1995,
using a market value of $63 per share, was as follows: Mr.
Steere -- $654,570; Mr. Bessey -- $109,116; Dr. McKinnell -- $147,294; Mr.
Neimeth -- $114,597; and Dr. Niblack -- $81,837.

(4) The 1994 and 1993 amounts shown in this column have not been adjusted for
the Company's June 1995 two-for-one stock split.

(5) The 1995 amounts shown in this column represent the dollar market value of
shares of the Company's Common Stock on February 22, 1996 (the payment date)
earned by the Named Executive Officers pursuant to the Company's
Performance-Contingent Share Award Program using the closing sales price of
the Company's Common Stock ($67.875) on the New York Stock Exchange on that
date. The number of Performance-Contingent Shares awarded to each executive
officer was as follows: Mr. Steere -- 30,000; Mr. Bessey -- 10,800; Dr.
McKinnell -- 10,800; Mr. Neimeth -- 9,000; and Dr. Niblack -- 9,000. This
Program is discussed in greater detail in the report of the Executive
Compensation Committee on page 11 of this Proxy Statement and also under the
heading "Employee Benefit and Long-Term Compensation Plans," which begins on
page 17.

(6) The amounts shown in this column constitute Company matching funds under the
Company's Savings and Investment Plan (a retirement savings plan) and
related supplemental plan. These plans are described in this Proxy Statement
under the heading "Employee Benefit and Long-Term Compensation Plans," which
begins on page 17. In the case of Mr. Bessey, this amount also includes
$156,937 paid to Mr. Bessey in consideration of the forfeiture, upon his
retirement on January 1, 1996, of 2,310 restricted shares of the Company's
common stock, awarded as part of his 1993 compensation. For purposes of this
cash payment, Mr. Bessey's restricted shares were valued using the average
of the high and low trading price of the Company's common stock ($67.938) on
the New York Stock Exchange on February 16, 1996.

OPTION GRANTS IN 1995

The following table shows all options to purchase the Company's Common Stock
granted to each of the Named Executive Officers of the Company in 1995 and the
potential value of such grants at stock price appreciation rates of 0%, 5% and
10%, compounded annually over the maximum ten-year term of the options. Also
shown is the potential gain of all outstanding shares of Common Stock held by
the Company's shareholders as of December 31, 1995 using the same base price and
appreciation rates and compounded over the same ten-year period. The 5% and 10%
rates of appreciation are required to be disclosed by the rules of the
Securities and Exchange Commission ("SEC") and are not intended to forecast
possible future actual appreciation, if any, in the Company's stock prices. The
Company did not use an alternative present value formula permitted by the rules
of the SEC because, in the Company's view, potential future unknown or volatile
factors result in there being no such formula that can determine with reasonable
accuracy the present value of such option grants.

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------------------------------
PERCENT OF POTENTIAL REALIZABLE VALUE AT ASSUMED
NUMBER OF TOTAL OPTIONS ANNUAL RATES OF STOCK PRICE APPRECIATION
SECURITIES GRANTED TO EXERCISE OR FOR OPTION TERM ($)
UNDERLYING OPTIONS EMPLOYEES IN BASE PRICE -----------------------------------------
NAME GRANTED (#) FISCAL YEAR ($/SH)(2) EXPIRATION DATE 0% 5% 10%
- ------------------- ------------------- ------------- ----------- --------------- --- -------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
W. C. Steere,
Jr................ 150,000(1) 2.15 49.00 08/23/05 0 4,622,376 11,714,007
E. C. Bessey....... N/A N/A N/A N/A N/A N/A N/A
H. McKinnell,
Jr................ 60,000(1) 0.86 49.00 08/23/05 0 1,848,950 4,685,603
R. Neimeth......... 50,000 (1) 0.72 49.00 08/23/05 0 1,540,792 3,904,669
J. F. Niblack...... 50,000 (1) 0.72 49.00 08/23/05 0 1,540,792 3,904,669
All Shareholders... N/A N/A N/A N/A 0 19,637,908,299 49,766,315,207
</TABLE>

- ------------------------------

(1) Option grants for each Named Executive Officer in 1995 consisted of a Key
Grant that is exercisable as follows: One-fifth each on 8/24/96, 8/24/97,
8/24/98, 8/24/99 and 8/24/2000.

(2) The exercise price for all stock option grants shown in this column is the
market price of the Company's Common Stock on the date of the grant.

9
<PAGE>
AGGREGATED OPTION EXERCISES IN 1995 AND
OPTION VALUES AT DECEMBER 31, 1995

The following table provides information as to options exercised by each of
the Named Executive Officers in 1995, and the value of the remaining options
held by each such executive officer at year-end, measured using the mean of the
high and the low trading price ($62.3125) of the Company's Common Stock on
December 29, 1995 (the last business day of 1995).

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS HELD AT 12/31/95 AT 12/31/95
VALUE -------------------------- ---------------------------
SHARES ACQUIRED REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
NAME ON EXERCISE (#) ($) (#) (#) ($) ($)
- -------------------------- --------------- ----------- ----------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
W. C. Steere, Jr.......... 139,472 3,373,234 390,780 430,000 10,939,360 9,754,375
E. C. Bessey.............. 70,964 1,658,994 163,004 48,500 4,295,320 1,406,406
H. McKinnell, Jr.......... 18,840 582,796 193,964 140,000 6,373,395 3,153,750
R. Neimeth................ 39,020 1,686,079 199,524 97,000 6,652,242 2,025,813
J. F. Niblack............. 18,552 530,362 121,920 117,000 3,130,085 2,642,063
</TABLE>

LONG-TERM INCENTIVE PLAN -- AWARDS IN 1995

The following table provides information concerning the participation of the
Named Executive Officers in a long-term compensation plan called the
Performance-Contingent Share Award Program pursuant to which they were awarded
the right to earn shares of the Company's Common Stock ("Performance-Contingent
Shares"). Actual payouts of these Performance-Contingent Shares, if any, will be
determined in accordance with a non-discretionary formula which measures the
Company's performance over a five-year period using certain performance goals
that were determined by the Company's Executive Compensation Committee and
approved by the Board. The formula is comprised of two performance
criteria -- growth in total shareholder return and growth in earnings per
share -- over the performance period relative to the industry peer group ("Peer
Group") referred to in the Performance Graph shown on page 16 of this Proxy
Statement. To the extent that the Company's performance exceeds the low end of
the range of the Peer Group's performance for either or both of the performance
criteria, a varying amount of shares up to the maximum will be earned. Details
regarding these awards are discussed in the Executive Compensation Committee
Report beginning on page 11 of this Proxy Statement.

<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS UNDER
NON-STOCK PRICE-BASED PLANS
------------------------------------
PERFORMANCE PERIOD (OR
OTHER PERIOD UNTIL THRESHOLD(2) TARGET
NAME NUMBER OF SHARES(1) MATURATION OR PAYOUT) (#) (#) MAXIMUM (#)
- ------------------------------ -------------------- ---------------------- ------------ --------- -----------
<S> <C> <C> <C> <C> <C>
W. C. Steere, Jr.............. * 1/1/96-12/31/2000 5,000 30,000 50,000
E. C. Bessey.................. None N/A N/A N/A N/A
H. McKinnell, Jr.............. * 1/1/96-12/31/2000 2,100 12,600 21,000
R. Neimeth.................... * 1/1/96-12/31/2000 1,800 10,800 18,000
J. F. Niblack................. * 1/1/96-12/31/2000 1,800 10,800 18,000
</TABLE>

- ------------------------------
(1) The actual number of Performance-Contingent Shares that will be paid out at
the end of the applicable period, if any, is not yet determinable because
the shares earned by the Named Executive Officers will be based upon the
Company's future performance compared to the future performance of the Peer
Group.

(2) If the minimum performance of the Company in both performance measures is at
the low end of the range relative to the Peer Group, then no
Performance-Contingent Shares will be earned by the Named Executive
Officers. To the extent that the Company's performance exceeds the low end
of the range of Peer Group performance, the minimum shares that will be
awarded is shown in the "Threshold" column.

10
<PAGE>
EXECUTIVE COMPENSATION COMMITTEE REPORT

The last section of this report is a glossary containing definitions of the
capitalized terms used in this report, unless such terms previously have been
defined in this Proxy Statement.

OVERVIEW OF COMPENSATION PHILOSOPHY AND PROGRAM

The Committee establishes the salaries and other compensation of the
executive officers of the Company, including its Chairman and CEO and other
Named Executive Officers. The Committee consists entirely of independent
directors who are not officers or employees of the Company.

The Company's executive compensation program is designed to:

-retain executive officers by paying them competitively, motivate
them to contribute to the Company's success, and reward them for
their performance;

-link a substantial part of each executive officer's compensation
to the performance of both the Company and the individual
executive officer; and

-encourage ownership of Company common stock by executive
officers.

As discussed below, the program consists of, and is intended to balance,
three elements -- base salaries, Annual Incentive Awards and long-term incentive
compensation.

Salaries are based on the Committee's evaluation of individual job
performance and an assessment of the salaries and total compensation mix paid by
the Company's Peer Group to executive officers holding equivalent positions.
Annual Incentive Awards are based on an evaluation of both individual and
Company performance against both qualitative and quantitative measures.
Long-term incentive awards, which consist of stock options and a
Performance-Contingent Share Award Program, are designed to insure that
incentive compensation is linked to the long-term performance of the Company and
its Common Stock. In addition, the Named Executive Officers and other members of
senior management are expected to own a minimum amount of Common Stock under the
Company's stock ownership program, which is intended to further tie the
interests of management to the interests of shareholders.

EVALUATION OF EXECUTIVE PERFORMANCE

Except as is otherwise specifically noted in this report, the Committee does
not rely solely on predetermined formulae or a limited set of criteria when it
evaluates the performance of the Chairman and CEO and the Company's other
executive officers, including the Named Executive Officers. Instead, the
Committee considers management's overall accomplishments, as well as those of
the individual executives, the Company's financial performance, and other
criteria discussed below. In 1995, management continued to effectively implement
its long-term strategies, which included: improving operating margins,
continuing the implementation of reengineering projects and a restructuring
program, integrating key acquisitions into its business segments, divesting
non-core businesses, maintaining the flow of new product candidates in the
Company's research pipeline and augmenting the Company's research and marketing
abilities with key external collaborations. The Committee believes that the
success of these strategies is evidenced by the Company's strong financial
performance from ongoing operations in 1995, the Company's operating margins,
the breadth of the Company's current product portfolio which resulted in
considerable sales growth in 1995, the acceptance of the Company's products in
the current marketplace, and the number of promising product candidates under
development by the Company.

The Committee also considered management's responses to the changes
occurring within the U.S. marketplace for health care products and services. The
impact of the evolution to managed care in the health care market continues to
be of particular importance to the Company and its shareholders. It is the
Committee's opinion that, in this uncertain environment, management continues to
develop effectively and implement strategies that position the Company to remain
a leader in the health care industry. In addition, Mr. Steere and his senior
management team are undertaking significant actions to communicate the Company's
position on health care issues to its shareholders, the public and the
government. The success of these efforts and their benefits to the Company
cannot, of course, be quantifiably measured, but the Committee believes they are
vital to the Company's continuing success.

11
<PAGE>
TOTAL COMPENSATION

Target total compensation levels of Company executives are established with
consideration given to an analysis of competitive market total compensation. The
total compensation package for each executive is then broken down into the three
basic components indicated above and discussed in more detail below. In recent
years, the Committee has been directing a shift in the mix of the Company's
executive compensation towards incentive compensation, with proportionately
lesser emphasis on salaries. This strategy is intended to increase the
performance orientation of the Company's executive compensation.

Consequently, salary levels of the Company's executives have been increasing
more slowly than other elements of their total compensation. The Committee
intends to continue this emphasis in 1996. For 1995, based on available public
data and the analysis of its outside compensation advisors, the total
compensation of Mr. Steere and the other Named Executive Officers generally
exceeded the total compensation paid by the Peer Group to their executives
holding equivalent positions, but the Committee believes it was consistent with
the outstanding performance of the Company compared to the Peer Group.

SALARY

In setting salaries, the Committee did not use a predetermined formula.
Instead, the 1995 salaries of the Chairman and CEO and the other executive
officers were based on the Committee's evaluation of each officer's individual
job performance, an assessment of the Company's performance, and a desire to
shift the mix of compensation towards performance-based categories, and took
into consideration salaries paid by the Peer Group to executive officers holding
equivalent positions. The salaries of Drs. McKinnell and Niblack and Mr. Neimeth
were subsequently increased to reflect their additional responsibilities assumed
following the announcement of Mr. Bessey's intended retirement. Mr. Steere's
salary in 1995 totaled $1,030,000. For 1996, it has been set at $1,190,000 which
represents a 15.5% increase from his 1995 salary. The 1995 salaries of the other
Named Executive Officers are shown in the "Salary" column of the Summary
Compensation Table on page 8 of this Proxy Statement.

ANNUAL INCENTIVE AWARDS

The second element of the executive compensation program is the Annual
Incentive Award Program. For Mr. Steere, the Annual Incentive Award can range
from 0 percent to 200 percent of his salary, depending upon the Board's
evaluation of Mr. Steere's performance. In evaluating his performance, the
Committee used the performance indicators referred to above under "Evaluation of
Executive Performance" and other confidential qualitative and quantitative
performance indicators that were recommended by Mr. Steere, adopted by the
Committee and confirmed by the Board in February 1995. After reviewing actual
results in 1995 against the performance indicators, the Committee approved, and
the Board confirmed, an Annual Incentive Award for 1995 to Mr. Steere of
$2,060,000.

The 1995 Annual Incentive Awards for other executive officers were based, in
part, on the same performance indicators used to determine Mr. Steere's annual
award. In addition, the executive officers were required to achieve certain
individual goals relating to their positions, plus confidential goals contained
in the Operating Plans of the businesses for which they are responsible, as well
as Company performance criteria. The Annual Incentive Awards for 1995 paid to
each of the Named Executive Officers are shown in the "Bonus" column of the
Summary Compensation Table on page 8 of this Proxy Statement.

LONG-TERM INCENTIVE AWARDS

In 1995, Mr. Steere and the other executive officers participated in the
Company's long-term incentive compensation program. As discussed below, the
program consisted of stock option grants made under the Company's Stock and
Incentive Plan, and awards made under the Company's Performance-Contingent Share
Award Program.

In 1995, in respect of Mr. Bessey's retirement, the Committee determined to
make a cash payment to Mr. Bessey equal to the value of 2,310 restricted shares
of the Company's Common Stock, awarded as part of his 1993 compensation, which
he forfeited by reason of his retirement. By his retirement, Mr. Bessey also
gave up additional Common Stock awards made to him in past years under the
Company's Performance-

12
<PAGE>

Contingent Share Award Program. The number of shares he would have earned from
those contingent awards will not be determined until 1997 and 1998. In respect
of his retirement, the Committee has agreed to pay to Mr. Bessey the pro-rated
cash value of those shares after their number has been determined.

(A) STOCK OPTIONS

The Committee granted Key-Employee Stock Options to each executive officer
in 1995 under the Company's Stock and Incentive Plan. In selecting the size of
the Key-Employee Stock Option grants, the Committee reviewed competitive data
relating to similar grants made by the Peer Group to executive officers holding
comparable positions at those companies, the individual stock ownership of the
Company's executive officers and the interrelationship with the 1995
Performance-Contingent Share Awards made to such officers. Based upon this data,
Mr. Steere was awarded Key-Employee Stock Options for 150,000 shares of Common
Stock and the other Named Executive Officers were awarded the number of Key-
Employee Stock Options shown in the table headed "Option Grants in 1995" on page
9 of this Proxy Statement. The Key-Employee Stock Options of the Named Executive
Officers and all other executive officers will vest over a five-year period,
with 20 percent of the options vesting each year.

Key-Employee Stock Options granted to Mr. Steere and the other Named
Executive Officers, when combined with the value of the Performance-Contingent
Shares that these officers may potentially earn, are targeted by the Committee
to fall at the median range of the value of long-term incentives granted by the
Peer Group to executive officers holding comparable positions at those
companies, assuming that the Company's performance also falls at the median of
the Peer Group's performance. If the Company's actual performance exceeds the
median performance of the Peer Group, however, the total value of long-term
incentive awards (which would include Performance-Contingent Share awards
discussed below) will be higher than the median awards made by the Peer Group.
Similarly, if the Company's performance falls below the median performance of
the Peer Group, the total value of the long-term incentive awards would fall
below the median awards of the Peer Group.

(B) PERFORMANCE-CONTINGENT SHARE AWARDS

The Committee also made awards to Mr. Steere and other executive officers in
1995, including the Named Executive Officers, under the Company's
Performance-Contingent Share Award Program (the "Program"). The potential size
of each award, including the maximum number of shares of Common Stock that may
be earned by each executive officer, was established by the Committee after
examining similar awards made by the Peer Group to executive officers holding
comparable positions at those companies. Payments pursuant to the awards are
determined by using a non-discretionary formula comprised of two performance
criteria measured over the applicable performance period: total shareholder
return and earnings per share growth over the performance period relative to the
performance of the Peer Group. The performance formula weighs each criterion
equally. To the extent that the Company's performance exceeds the low end of the
range of the performance of the Peer Group in either or both of the performance
criteria, a varying amount of shares of Common Stock up to the maximum will be
earned.

Except for the 1993 Program awards, which provide for shorter performance
periods, the performance period for all awards made under the Program is five
years. Based on the Company's performance during the 1993-95 performance period,
Mr. Steere and the other Named Executive Officers earned the maximum number of
Performance-Contingent Shares possible under the 1993 Program award formula
previously approved by the Committee. The total number of such shares earned by
Mr. Steere was 30,000. The total number of shares earned by each of the Named
Executive Officers is shown on page 9 of this Proxy Statement in footnote 5 to
the "LTIP Payouts" column of the Summary Compensation Table.

In connection with the 1995 Program award for Mr. Steere, the number of
Performance-Contingent Shares that he may earn at the end of the five-year
performance period (1/1/96-12/31/2000) will range from 0 to 50,000. As for the
other Named Executive Officers, the number of Performance-Contingent Shares that
Dr. McKinnell may earn at the end of the same five-year performance period will
range from 0 to 21,000, while the number of such shares that Mr. Neimeth and Dr.
Niblack may earn will range from 0 to 18,000. The maximum number of
Performance-Contingent Shares that may be earned by Mr. Steere and the other
Named Executive Officers under the Program is shown in the table headed
"Long-Term Incentive Plan -- Awards in 1995" on page 10 of this Proxy Statement.

13
<PAGE>
TAX POLICY

In 1993, the Internal Revenue Code ("Code") was amended with respect to the
tax deductibility of executive compensation. Under the Code, publicly-held
companies such as the Company may not deduct compensation paid to certain
executive officers to the extent that such compensation exceeds $1 million in
any one year for each such officer. The law, however, includes an exception for
"performance-based" compensation, including stock options granted under a stock
option plan that has been previously approved by shareholders, provided that
such options are not issued below the fair market value of the stock on the date
of the grant. The Company's Stock and Incentive Plan meets these requirements so
stock options awarded to the Company's executive officers in 1995 are eligible
for the performance-based compensation exception to the deduction limitation.
Compensation other than stock options, however, must meet other requirements in
order to qualify as tax deductible "performance-based" compensation.

Under the Code, compensation is deemed "performance-based", and not subject
to the $1 million deduction limitation, if it meets the following requirements:
(1) it is paid solely on account of the attainment of one or more preestablished
objective performance goals; (2) the performance goals under which the
compensation is to be paid are established by a committee comprised solely of
two or more outside directors who satisfy certain requirements; (3) the
committee certifies in writing prior to payment of the compensation that the
performance goals and any other material terms of payment were, in fact,
satisfied; and (4) the material terms of the performance goals under which the
compensation is to be paid has been approved by a vote of the majority of the
outstanding shares of the Company.

The Performance-Contingent Share Awards granted in 1995 to Mr. Steere and
the other executive officers qualify as "performance-based" compensation under
the requirements of the Code as set forth above. Accordingly, the eventual
payouts of these awards will be fully deductible by the Company.

The Annual Incentive Awards granted to the Company's executive officers in
1995 are not eligible for the performance-based exception under the Code because
they were awarded based, in part, on certain goals (such as responding to
changes occurring within the U.S. health care marketplace) and performance
evaluations that would not be deemed solely "objective" as required for
deductions by the tax law. The Committee and the Board believe that it is not in
the best interests of the Company and its shareholders, however, to limit itself
to goals that are exclusively objective in connection with the Annual Incentive
Award Program. The Committee and the Board will continue to evaluate their
position on this issue, however, as the regulations under the law are finalized.

STOCK OWNERSHIP PROGRAM

A stock ownership program was adopted by the Board upon this Committee's
recommendation in August 1993. Under the guidelines of this program, employee
directors (currently Mr. Steere) are expected to own by December 1998 Company
Common Stock equal in value to at least three times their annual salaries. The
program also extends to the other Named Executive Officers and certain other
executive officers who, as of the same time, are expected to own Company Common
Stock equal in value to at least two times their annual salaries. All other
executive officers are expected to own stock with a value equivalent to their
annual salaries.

Under the program, "stock ownership" is defined as stock owned by the
executive officer directly or through the Company's Savings and Investment Plan.
While the Named Executive Officers and other participants in this program have
been given five years to achieve compliance with this program, the Committee
monitors the participation of the executive officers and expects that
incremental progress will be made each year by each officer during the five-year
phase-in period. The Committee has determined that, as of the end of 1995, full
compliance had already been achieved by most executive officers, and good-
progress toward their goals had been made by all others.

GLOSSARY

ANNUAL INCENTIVE AWARDS. These awards are annual cash payments which may be
awarded by the Committee to executive officers on the basis of both Company
performance and individual performance

14
<PAGE>
over the prior year. Qualitative and quantitative performance indicators used to
serve as the basis for an assessment of the performance of the executive
officers are established by the Committee (and approved by the Board in the case
of the CEO) at the beginning of the performance period.

COMMITTEE. The Executive Compensation Committee of the Board of Directors.

KEY-EMPLOYEE STOCK OPTIONS. Stock options granted under the Company's Stock
and Incentive Plan to a select group of management employees in the U.S. and
overseas who are considered to have a substantial impact on the Company's
operations.

NAMED EXECUTIVE OFFICERS. This refers to the five most highly compensated
executive officers of the Company -- Messrs. Steere, Bessey and Neimeth and Drs.
McKinnell and Niblack.

PEER GROUP. This group consists of the eleven health care companies
referred to in the Performance Graph that follows this report.

PERFORMANCE-CONTINGENT SHARES. These are shares of Pfizer Inc. Common Stock
that may be awarded by the Committee to the Named Executive Officers and certain
other employees of the Company under the Performance-Contingent Share Award
Program. For shares to be issued to any such officer or employee, however,
certain preestablished Company performance criteria must be met over a
preestablished performance period. This program is described in further detail
on page 18 of this Proxy Statement.

STOCK AND INCENTIVE PLAN. This refers to the Pfizer Inc. Stock and
Incentive Plan which is described in further detail on page 19 of this Proxy
Statement.

THE EXECUTIVE COMPENSATION COMMITTEE:

Mr. Burns (Chair)

Mr. Harvey

Mr. Labrecque

15
<PAGE>
PERFORMANCE GRAPH

Set forth below is a graph comparing the total shareholder returns (assuming
reinvestment of dividends) of the Company, the Standard & Poor's ("S&P") 500
Composite Stock Index ("S&P 500"), and an industry peer index compiled by the
Company that consists of the following companies: Abbott Laboratories, American
Home Products Corp., Baxter International Inc., Bristol-Myers Squibb Company,
Colgate-Palmolive Co., Johnson & Johnson, Eli Lilly and Company, Merck and Co.,
Inc., Pharmacia & Upjohn Inc., Schering-Plough Corp., and Warner-Lambert Company
(together the "Peer Group"). The Peer Group consolidation was done on a weighted
average basis (market capitalization basis, adjusted at the beginning of each
year). The graph assumes $100 invested at the per share closing price of the
Common Stock on the New York Stock Exchange Composite Tape on December 31, 1990
in the Company and each of the other indices.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURNS*
<S> <C> <C> <C>
1991 through 1995
Pfizer Peer Group S&P 500
1990 100 100 100
1991 217.5 151.5 130.5
1992 191.5 127.9 140.4
1993 187.1 119.8 154.5
1994 215.8 135.5 156.6
1995 359.7 213.1 215.4
</TABLE>

16
<PAGE>
EMPLOYEE BENEFIT AND LONG-TERM COMPENSATION PLANS
RETIREMENT ANNUITY PLAN

The Retirement Annuity Plan (the "Retirement Plan") is a funded, tax
qualified, noncontributory defined benefit pension plan that covers certain
employees, including the Named Executive Officers. Benefits under the Retirement
Plan are based upon the employee's earnings during service with the Company
and/or its "Associate Companies" and are payable after retirement generally in
the form of an annuity. Earnings covered by the Retirement Plan are base pay,
bonus, long-term incentive pay and vested shares of restricted stock. The amount
of annual earnings that may be considered in calculating benefits under the
Retirement Plan is limited by law. For 1996, the current annual limitation is
$150,000. The value of benefits, such as stock options, is not considered
earnings for the purposes of the Retirement Plan.

Benefits under the Company's Retirement Plan are calculated as an annuity
equal to the greater of (i) 1.4 percent of the average earnings for the five
highest consecutive calendar years prior to January 1, 1995 multiplied by years
of service, or (ii) 1.75 percent of such earnings less 1.5 percent of Primary
Social Security benefits multiplied by years of service. The total years of
service under these formulas cannot exceed 35 years. Actual earnings are used in
benefit calculations for the period after December 31, 1994 under both formulas.
Contributions to the Retirement Plan are made entirely by the Company and are
paid into a trust fund from which the benefits of participants will be paid.

In accordance with the requirements of the Code, the Retirement Plan
currently limits pensions paid under the Plan to an annual maximum of $120,000,
payable at age 65. The Company also has an unfunded supplemental plan that
provides that the Company will pay out of its general assets an amount
substantially equal to the difference between the amount that would have been
payable under the Retirement Plan, in the absence of legislation limiting
pension benefits and earnings that may be considered in calculating pension
benefits, and the amount actually payable under the Retirement Plan. In certain
circumstances, the Company is obligated to fund trusts established to secure its
obligations to make payments under the supplemental plan.

PENSION PLAN TABLE

The following table shows, for the final compensation and years of service
indicated, the annual pension benefit, payable commencing upon retirement at age
65 under the present benefit formula of the Retirement Plan and its related
supplemental plan. The estimated retirement benefits have been computed on the
assumptions that (i) payments will be made in the form of a 50 percent joint and
survivor annuity (and both the Plan member and spouse are age 65), (ii) during
the period of employment the employee received annual compensation increases of
six percent and (iii) the employee retired as of December 31, 1995.

<TABLE>
<CAPTION>
YEARS OF SERVICE
-------------------------------------------------------------------------
REMUNERATION 15 20 25 30 35
- -------------------------------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
$ 250,000............................. $ 47,046 $ 62,523 $ 78,000 $ 93,478 $ 108,955
400,000............................. 77,008 102,350 127,691 153,033 178,374
500,000............................. 96,983 128,901 160,818 192,736 224,654
700,000............................. 136,932 182,002 227,072 272,143 317,213
950,000 ............................ 186,869 248,379 309,890 371,401 432,912
1,000,000............................ 196,856 261,655 326,454 391,253 456,052
1,200,000............................ 236,805 314,757 392,708 470,659 548,611
1,800,000............................ 356,653 474,062 591,471 708,879 826,288
2,000,000............................ 396,602 527,164 657,725 788,286 918,847
2,100,000............................ 416,577 553,715 690,852 827,990 965,127
3,000,000............................ 596,349 792,672 988,996 1,185,320 1,381,643
3,500,000............................ 696,222 925,427 1,154,632 1,383,836 1,613,041
4,000,000............................ 796,095 1,058,181 1,320,267 1,582,353 1,844,439
5,000,000............................ 995,842 1,323,690 1,651,538 1,979,387 2,307,235
6,000,000............................ 1,195,588 1,589,199 1,982,809 2,376,420 2,770,031
6,500,000............................ 1,295,461 1,721,953 2,148,445 2,574,937 3,001,429
</TABLE>

17
<PAGE>

As of December 31, 1995, the period of service covered by the Retirement
Plan and the supplemental plan are, for Mr. Steere -- 35 years; Mr. Bessey -- 31
years, 8 months; Dr. Niblack -- 28 years, 1 month; Mr. Neimeth -- 33 years, 4
months; and Dr. McKinnell -- 24 years, 10 months. Compensation covered by the
Retirement Plan and its related supplemental plan for the Named Executive
Officers equals the amounts set forth in the 1995 "Salary," "Bonus" and "LTIP
Payouts" columns of the Summary Compensation Table and the value of the
restricted stock that vested on February 17, 1995 as described in Footnote 3 to
that table. The basis upon which benefits are calculated under the Company's
Retirement Plan is described in the "Retirement Annuity Plan" section on page 17
of this Proxy Statement.

PERFORMANCE-CONTINGENT SHARE AWARD PROGRAM

Under the Performance-Contingent Share Award Program, participating
employees may be granted an opportunity by the Company's Executive Compensation
Committee to earn shares of Common Stock, provided certain performance criteria
are met. The performance formula is nondiscretionary and is comprised of two
performance criteria -- total shareholder return (including reinvestment of
dividends) and earnings per share (as reported) -- measured point-to-point over
the applicable performance period relative to the performance of the Peer Group
as defined in the "Performance Graph" section of this Proxy Statement. The 200
most highly compensated employees of the Company are eligible to be granted the
opportunity by the Executive Compensation Committee to earn
Performance-Contingent Shares. Except for awards made in 1993, all awards
granted under the Program are based upon a five-year performance period. Awards
earned by the Named Executive Officers under this Program for the performance
period ended December 31, 1995 are shown in the "LTIP Payouts ($)" column of the
Summary Compensation Table on page 8 of this Proxy Statement.

SAVINGS AND INVESTMENT PLAN

Under the terms of the Savings and Investment Plan (the "Savings Plan"),
participating employees may contribute up to 15 percent of regular earnings into
their Savings Plan accounts. A participating employee may elect to make
after-tax contributions, before-tax contributions, or both after-tax and
before-tax contributions. In addition, under the Savings Plan, the Company
contributes an amount equal to one dollar for each dollar contributed by
participating employees up to the first two percent of their regular earnings
and fifty cents for each additional dollar contributed by employees on the next
four percent of their regular earnings. The Company's matching contributions are
invested solely in the Company's Common Stock.

In accordance with the requirements of the Code, the Savings Plan currently
limits the additions that can be made to a participating employee's account to
$30,000 per year. The term "additions" includes Company matching contributions,
before-tax contributions made by the Company at the request of the participating
employee under Section 401(k) of the Code, and employee after-tax contributions.

Of those additions, the maximum before-tax contribution is limited, for
January 1, 1994 through December 31, 1995, to $9,240 per year. Effective January
1, 1996, this limit increased to $9,500 per year. In addition, no more than
$150,000 of annual compensation may be taken into account in computing benefits
under the Savings Plan, in accordance with the Code. The Company has a
supplemental plan to pay out of general assets an amount substantially equal to
the difference between the amount that, in the absence of legislation limiting
such additions and the $150,000 limitation on earnings, would have been
allocated to a participating employee's account as employee before-tax
contributions, Company matching contributions and the amount actually allocated
under the Savings Plan. Employees affected by these limitations can make limited
deferrals of income under this supplemental plan and receive credit for such
deferrals towards their retirement benefit under the Company's retirement plans.
In certain circumstances, the Company is obligated to fund trusts established to
secure its obligations to make payments under the supplemental plan.

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Amounts deferred, if any, under the Savings Plan and the related
supplemental plan in 1995 by the Company's Named Executive Officers are included
in the "Salary" and "Bonus" columns of the Summary Compensation Table shown on
page 8 of this Proxy Statement. Company matching contributions allocated to the
Named Executive Officers under the Savings Plan and the related supplemental
plan are shown in the "All Other Compensation" column of the Summary
Compensation Table on page 8 of this Proxy Statement.

STOCK AND INCENTIVE PLAN

Pursuant to the Stock and Incentive Plan, Company employees may be granted
stock options, stock appreciation rights, stock awards (including restricted
stock awards and performance-based stock awards), or performance unit awards,
either as a result of a general grant or as a result of an award based on having
met certain performance criteria, as determined by the Employee Compensation and
Management Development Committee or the Executive Compensation Committee, as
applicable. The Stock and Incentive Plan is described in greater detail in Item
3 of this Proxy Statement which begins on page 24.

SEVERANCE AGREEMENTS

The Company has entered into severance agreements with certain executive
officers, including each of the Named Executive Officers. The agreements
continue through September 30, 1996 and provide that they are to be
automatically extended in one-year increments unless the Company has given prior
notice of termination.

These agreements are intended to provide for continuity of management in the
event of a change in control of the Company. The agreements provide that covered
executive officers could be entitled to certain severance benefits following a
change in control of the Company. If, following such a change in control, the
executive officer is terminated by the Company for any reason, other than for
disability or for cause, or if such executive officer terminates his or her
employment for good reason (as this term is defined in the agreements), then the
executive officer is entitled to a severance payment that will be 2.99 times the
greater of (i) the executive officer's base amount, as defined in the agreements
or (ii) the sum of the executive officer's (a) base salary in effect at the time
of termination and (b) the higher of the (x) last full-year annual incentive
payment or (y) projected annual incentive payment for the year in which
termination occurs. The severance payment generally would be made in the form of
a lump sum.

In addition, in the event of such a termination following a change in
control, under the agreements each executive officer would receive a payout of
all outstanding Performance-Contingent Share Awards that had been granted prior
to the date of termination at the maximum amounts that could have been earned
pursuant to the awards. The executive officer would also receive a benefit
payable from the Company's general funds calculated using the benefit
calculation provisions of the Company's Retirement Annuity Plan and the
Company's unfunded Supplemental Retirement Plan with the following additional
features: the executive officer would receive credit for an additional three
years of service and compensation for purposes of calculating such benefit; the
benefit would commence at age 55 (or upon the date of termination, if the
executive officer is then over age 55) and for this purpose, three years would
be added to the executive officer's age; such benefit would be further
determined without any reduction on account of its receipt prior to age 65; and,
such benefit would be offset by any amounts otherwise payable under the
Company's Retirement Annuity Plan and unfunded Supplemental Retirement Plan. The
executive officer would also become vested in all other benefits available to
retirees of the Company including, without limitation, retiree medical coverage.
All restrictions on restricted stock previously awarded to such executive
officer would lapse and all unvested options granted to such executive officer
would vest and become exercisable for the remainder of the term of the option.

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If a change in control occurs, the agreements are effective for a period of
four years from the end of the then existing term. Under the severance
agreements, a change in control would include any of the following events: (i)
any "person", as defined in the Securities Exchange Act of 1934, as amended,
acquires 20 percent or more of the Company's voting securities; (ii) a majority
of the Company's directors are replaced during a two-year period; or (iii)
shareholders approve certain mergers, or a liquidation or sale of the Company's
assets. In the event that any payments made in connection with a change in
control would be subjected to the excise tax imposed by Section 4999 of the
Code, the Company will "gross-up" the executive officer's compensation for all
federal, state and local income and excise taxes and any penalties and interest
thereon.

In certain circumstances, the Company is obligated to fund trusts
established to secure its obligations to make payments under the severance
agreements in advance of the time payment is due.

COMPENSATION OF DIRECTORS AND OTHER MATTERS

The non-employee directors of the Company receive an annual cash retainer
fee of $26,000 per year. Non-employee directors who serve on one Board committee
or more (other than the Executive Committee) receive an additional annual fee of
$4,000 for such service. In addition, non-employee directors who chair a Board
committee receive an additional $2,000 per year, per committee. Directors who
are employees of the Company receive no retainers for Board-related service.

The non-employee directors of the Company also receive a fee of $1,500 for
attending each Board meeting, committee meeting, the Annual Meeting of
Shareholders, for each day of a visit by the Board to a plant or office of the
Company or its subsidiaries, and for attending any other business meeting to
which the director is invited by the Board or the Executive Committee. Directors
who are employees of the Company receive no fees for attending any such meeting.

In addition to the annual cash compensation discussed above, on the day of
the 1995 Annual Meeting of Shareholders, all non-employee directors of the
Company were awarded 300 units (increased to 600 units in June of 1995 due to
the Company's stock split) measured by the price of the Company's Common Stock
under the Pfizer Inc. Nonfunded Deferred Compensation and Unit Award Plan for
Non-Employee Directors. A description of this Plan is set forth below.

In October of 1995 the Company's Retirement Plan for Non-Employee Directors
was terminated. Benefits existing under the Plan were vested as of that time for
all directors who had served on the Board as of that date.

BENEFIT PLANS FOR NON-EMPLOYEE DIRECTORS

Under the Pfizer Inc. Nonfunded Deferred Compensation and Unit Award Plan
for Non-Employee Directors (the "Unit Award Plan"), directors who are not
employees of the Company or any of its subsidiaries may defer all or a part of
their annual cash retainers and meeting fees. At the director's election, the
fees held in the director's account may be credited either with interest at the
rate of return of Fund A (the Fixed Income Fund) of the Pfizer Inc. Savings and
Investment Plan, or with units. The units are calculated by dividing the amount
of the fee by the closing price of the Common Stock as of the last business day
prior to the date that the fee would otherwise be paid. The units in a
director's account are increased by the value of any distributions on the Common
Stock, allocated in accordance with the number of units in the account. When a
director ceases to hold office, the amount held in the director's account is
then payable in cash. The amount to be paid is determined by multiplying the
number of units in the account by the closing price of the Common Stock as of
the last business day prior to the payment date as determined in the Unit Award
Plan.

Also under the Unit Award Plan, non-employee directors are granted an
initial award of 600 units (300 units prior to the Company's stock split in June
of 1995) upon first becoming a director. Thereafter, each non-employee director
is granted an annual award of 600 such units ("Annual Unit

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Award") as of the date of the Company's Annual Meeting, provided the director
will continue to serve as a director following the meeting. The awards under the
Unit Award Plan are made in addition to the directors' annual cash retainers and
meeting attendance fees.

Non-employee directors also receive the share equivalent of their annual
retainer fee in restricted units. These awards will be in addition to the Annual
Unit Awards, the directors' annual cash retainers and meeting attendance fees,
and will also be made annually on the day of the Company's Annual Meeting. The
appropriate number of units to be awarded to the non-employee directors will be
based upon the five-day average of the closing trading price of the Company's
Common Stock on the New York Stock Exchange for the first five trading days
after April 1 of each year (rounded up to the nearest unit).

In certain circumstances, the Company is obligated to fund trusts
established to secure its obligations to make payments to its directors under
the above benefit plans, programs or agreements in advance of the time payment
is due.

CONSULTING AGREEMENTS

Under a consulting agreement with the Company, Mr. Pratt consults with the
Company on business matters involving the areas of tax, trade and intellectual
property. In return for this advice, the Company is obligated to pay Mr. Pratt
an annual consulting fee, payable monthly. The agreement runs year-to-year and
may be terminated at the end of any year by either the Company or Mr. Pratt on
90 days written notice, or at any time upon the mutual agreement of both
parties. In addition, the Company must reimburse Mr. Pratt for reasonable
business expenses he incurs in connection with the services he provides to the
Company under this agreement. The amount paid to Mr. Pratt under the agreement
for the services he rendered to the Company during 1995 was $100,000.

RELATED TRANSACTIONS

During 1995, the Company engaged the services of Lazard Freres & Co. LLC, of
which Mr. Rohatyn is a Managing Director and Mr. Lynn is a Senior Advisor.
Lazard Freres & Co. LLC acted as a financial advisor in connection with
potential acquisitions, divestitures, general corporate matters and as a broker
in connection with the purchase and sale of securities. In 1996, the Company
plans to retain this firm for such services and similar services. In addition,
the Pfizer Retirement Annuity Plan is a limited partner in Corporate Partners,
L.P., of which LFCP Corp., a wholly-owned subsidiary of Lazard Freres & Co. LLC,
is the general partner.

During 1995, the Company received from The Chase Manhattan Bank, N.A.
$1,132,226 representing income generated from a $25 million notional principal
amount fixed-to-floating-interest-rate swap. Mr. Labrecque was Chairman and
Chief Executive Officer of the Bank in 1995.

In addition, the Company had the following transactions in 1995 with
Minerals Technologies Inc., of which Dr. Valles is Chairman and Chief Executive
Officer: purchases of granular lime and calcium carbonate ground limestone for
approximately $295,000.

The Company also had the following transactions in 1995 with Pitney Bowes,
of which George B. Harvey is Chairman, President, and Chief Executive Officer:
the leasing and purchasing of office equipment including fax machines, postage
meters, supplies and parts for approximately $195,000.

The transactions described in this section were entered into by the Company
pursuant to arm's length negotiations in the ordinary course of business and on
terms that the Company believes to be fair.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

In 1995, the following members of the Board served on the Executive
Compensation Committee: Messrs. Burns (Chair), Harvey and Labrecque. As noted
above under the "Related Transactions"

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section, during this same time, the Company received approximately $1,132,226
from The Chase Manhattan Bank, N.A., of which Mr. Labrecque was Chairman and
Chief Executive Officer in 1995, representing income generated from a $25
million notional principal amount fixed-to-floating-interest-rate swap. In
addition, in 1995 the Company paid Pitney Bowes approximately $195,000 for the
purchase and leasing of office equipment. Mr. Harvey is the Chairman, President
and Chief Executive Officer of Pitney Bowes.

ADDITIONAL INFORMATION

The directors (other than Ms. Horner, and Messrs. Burns, Harvey, Labrecque
and Raines) and certain officers and former directors and officers of the
Company are defendants in a civil suit brought purportedly on behalf of the
Company as a shareholder derivative action in the Superior Court of the State of
California, County of Orange. The complaint alleges breaches of fiduciary duty
and other common law violations in connection with the manufacture and
distribution of Shiley heart valves and seeks, among other things, unspecified
money damages. The defendants in the action believe that the suit is without
merit.

BOARD COMMITTEES
THE EXECUTIVE COMPENSATION COMMITTEE

During 1995, the Executive Compensation Committee consisted of Messrs. Burns
(Chair), Harvey and Labrecque. None of the directors on this Committee are
employees of the Company. The Committee met eight times in 1995.

The Executive Compensation Committee is responsible for establishing annual
and long-term performance goals for the Company's elected officers. This
responsibility includes establishing the compensation and evaluating the
performance of the Chairman and Chief Executive Officer, the employee-directors,
and other elected officers of the Company based on the guidelines and standards
of the competitive industry. The Committee's additional functions are to
determine and certify the shares awarded under the Performance-Contingent Share
Award Program; to grant options and awards under the Stock and Incentive Plan;
to advise on the setting of compensation for senior executives whose
compensation is not set by the Committee; and to publish an annual Executive
Compensation Committee Report for the shareholders. The Executive Compensation
Committee Report is included on page 11 of this Proxy Statement.

THE CORPORATE GOVERNANCE COMMITTEE

During 1995, the Corporate Governance Committee (formerly the Nominating
Committee) consisted of Dr. Marks (Chair), Miss Fippinger, Ms. Horner and Mr.
Lynn. None of the directors on this Committee are employees of the Company. The
Committee met seven times in 1995.

The Corporate Governance Committee is responsible for considering and making
recommendations to the Board concerning the appropriate size, function, and
needs of the Board, and for evaluating the performance of the Board as a whole.
This responsibility includes considering and recommending candidates to fill new
positions on the Board created by either expansion or vacancies that occur by
resignation, retirement, or for any other reason; reviewing candidates
recommended by shareholders; conducting inquiries into the backgrounds and
qualifications of possible candidates; and recommending the director nominees
for approval by the Board and the shareholders. The Committee's additional
functions are to consider questions of possible conflicts of interest of Board
members; to monitor and recommend the functions of the various committees of the
Board; to recommend members and chairs of the committees; to advise on changes
in Board compensation; to make recommendations on the structure of Board
meetings; and to recommend matters for regular consideration by the Board. In
addition, the Committee considers and reviews the Company's Corporate Governance
Principles; establishes director retirement policies; reviews the job
performance of

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officers and other senior executives with the Chairman and Chief Executive
Officer; reviews the outside activities of senior executives; reviews with the
Chief Executive Officer the succession plans relating to officer and senior
management positions; and considers all matters of social responsibility.

THE AUDIT COMMITTEE

The Audit Committee consists of Dr. Ikenberry (Chair), Mr. Raines and Mr.
Rohatyn, none of whom is an employee of the Company. The Committee met five
times in 1995.

The Audit Committee has the responsibility of recommending the annual
appointment of the public accounting firm to serve as the Company's outside
independent auditors, subject to approval by the Board and the shareholders and
being available during the course of the outside independent audit to discuss
and review any matters with the auditors that might affect the financial
statements, internal controls, or other financial aspects of the operations of
the Company or its subsidiaries. The Committee reviews the Company's accounting
procedures and systems of control, the Company's annual and quarterly financial
statements, and any material changes in accounting principles or practices used
in preparing the statements. It reviews reports on other risks to the material
assets of the Company. Additional responsibilities include reviewing the scope
of prospective audits, reviewing the estimated fees of the outside independent
auditors and ensuring the implementation of the independent auditor's accepted
recommendations regarding internal controls, accounting practices, and
procedures. The Committee also reviews the current and future programs of the
Company's internal audit department; summaries of all the internal audit
reports; initiates any examinations or other appropriate actions with respect to
the adequacy of the system of internal controls and the accounting practices of
the Company and its subsidiaries; examines and considers current accounting
trends and developments; and reviews the Company's compliance with the Foreign
Corrupt Practices Act.

ITEM 2 -- APPROVAL OF APPOINTMENT OF AUDITORS FOR 1996

The Board, upon the recommendation of its Audit Committee, has appointed
KPMG Peat Marwick LLP to serve as the Company's independent auditors for 1996,
subject to the approval of the Company's shareholders. The firm and its
predecessors have audited the financial records of the Company for many years
during which time the practice of rotating the engagement partner has been
followed. The Board considers the firm to be well qualified.

It is expected that representatives of KPMG Peat Marwick LLP will be present
at the Annual Meeting to answer questions. They also will have the opportunity
to make a statement if they desire to do so.

Total audit fees incurred by the Company for all independent auditors for
1995 were approximately $5,642,000, of which $5,423,000 was attributable to KPMG
Peat Marwick LLP.

The affirmative vote of a majority of votes cast on this proposal is
required for the approval of this proposal.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL OF KPMG PEAT
MARWICK LLP AS INDEPENDENT AUDITORS OF THE COMPANY FOR THE YEAR 1996.

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ITEM 3 -- APPROVAL OF AMENDMENTS TO THE PFIZER INC.
STOCK AND INCENTIVE PLAN TO INCREASE THE NUMBER OF
SHARES OF COMMON STOCK AUTHORIZED TO BE ISSUED UNDER THE PLAN
AND TO EXTEND THE TERM OF THE PLAN TO DECEMBER 31, 2005

The Pfizer Inc. Stock and Incentive Plan (the "Plan") enables the Company to
grant stock options, stock awards, stock appreciation rights, performance unit
awards and tandem awards (collectively referred to herein as "grants") to
employees of the Company. The shareholders of the Company initially approved the
Plan in 1965, and since then have approved a number of amendments to the Plan.
Non-employee directors of the Company are not eligible to participate in the
Plan. The Plan currently expires on December 31, 2001 but, upon the approval of
the Company's shareholders, this expiration date will be extended to December
31, 2005.

The Board believes that the Plan has proved to be of substantial value to
the Company over the years because it enables the Company to offer employees
long-term performance-based compensation -- such as stock options -- that
motivates employees to contribute to the continuing financial success of the
Company.

From the Plan's inception in 1965, through December 31, 1995, options
covering 165,393,322 shares (including options that subsequently terminated or
lapsed and were regranted under the terms of the Plan) have been granted to
employees. From 1965 through December 31, 1995, options for 98,967,282 shares
have been exercised. A total of 42,904,217 shares were subject to outstanding
options as of such date, leaving only 3,574,593 shares available for future
options or awards.

The number of shares of Common Stock remaining available for grants under
the Plan are insufficient, however, to adequately provide for the participation
of the number of employees eligible to receive such grants. Accordingly, the
Board adopted amendments to the Plan to increase the aggregate number of shares
of Common Stock available for issuance under the Plan by an additional 23
million shares and to extend the term of the Plan to December 31, 2005. The
amendments to the Plan are subject to approval of the holders of a majority of
the shares of the Common Stock issued, outstanding and entitled to vote.

In the event the shareholders approve the current proposal to increase the
number of shares authorized to be issued under the Plan, a total of
approximately 26,574,590 shares will be available for future options or awards
under the Plan.

Notwithstanding the broader general terms of the Plan, the Company has
committed that, with respect to the additional 23 million shares requested for
use under the Plan: (1) no more than 2.2 million shares will be granted as
restricted stock or equivalent awards having no exercise price; (2) the balance
of the new shares will be granted under options with an exercise price of no
less than the fair market value of the underlying stock at the time of grant and
a term of no longer than 10 years; (3) no more than 8.4 million of such shares
will be granted under "across-the-board" stock options to generally all
employees and vesting of approximately one year from grant date; and (4) all
shares not granted under (1) or (3) above will be subject to options with a
minimum of three year vesting from the grant date.

The holders of Common Stock do not have preemptive rights. The Plan, as
proposed to be amended, is described below.

THE OPERATION OF THE PLAN

Within certain limits, the Board has the right to alter, amend or revoke the
Plan. The Board of Directors may not, however, without the approval of the
shareholders, alter or amend the Plan to increase the maximum number of shares
of Common Stock that may be issued under the Plan or the

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number of such shares that may be issued to any one participant; extend the term
of the Plan or of options granted thereunder; reduce the option price below that
now provided for under the Plan; or change certain of the conditions of the
exercise of options.

In the event of certain changes in the number or kind of outstanding shares
of Common Stock, an appropriate adjustment will be made with respect to existing
and future options. The proceeds received by the Company from the sale of stock
under the Plan are added to the general funds of the Company.

The Plan is administered by the Employee Compensation and Management
Development Committee. However, only the Executive Compensation Committee -- a
committee comprised of non-employee directors of the Company -- is authorized to
administer those portions of the Plan relating to the grant of stock
appreciation rights and related options and those grants or awards made to
employees who are directors or executive officers of the Company. The current
members of the Executive Compensation Committee are Mr. Burns (Chair), Mr.
Harvey and Mr. Labrecque. The current members of the Employee Compensation and
Management Development Committee are Mr. Steere (Chair), Dr. McKinnell, Dr.
Niblack, Mr. Neimeth and Bruce R. Ellig, Vice President Employee Resources. The
Employee Compensation and Management Development Committee and the Executive
Compensation Committee are hereafter referred to together as the "Plan
Committees."

STOCK OPTIONS

The option price may not be less than the fair market value of the stock on
the date the option is granted. The option price is payable in cash or, if so
provided under the terms of the option, in Common Stock. Generally, no option
may be exercised during the first year of its term or such longer period as may
be specified in the option. The Plan authorizes the Board to make all unvested
stock options immediately exercisable upon a change of control of the Company. A
"change in control" would include the acquisition by a third party of 20% or
more of the Common Stock, or a merger, or liquidation, or sale of substantially
all the assets of the Company. The Plan also authorizes the Plan Committees to
make options that are not yet exercisable, immediately exercisable where an
optionee's employment is to be terminated due to a divestiture or a downsizing
by the Company; for a retiring optionee who holds options with extended vesting
provisions; upon the death of the optionee and to prevent other such inequities.

All unexercised options terminate after a certain number of years, or
earlier, depending upon the optionee's termination of employment, retirement,
death, or breach of any provision of the option. The Plan Committees determine
the term of each stock option grant at the time of the grant. The term of any
incentive stock option may not exceed ten years from the date of grant. In cases
where it is deemed appropriate, however, non-qualified options can be granted
for more than a ten-year period. Shares under options that have terminated or
lapsed, including options that have been surrendered unexercised, may be made
subject to further options or awards.

Among those employees who are currently eligible to receive options, awards
and rights under the terms of the Plan are a total of 23 executive officers. In
1995, 23 executive officers of the Company were collectively granted a total of
641,700 options for ten years at $49.00 per share (the then-current market
price) under the Plan. During the same period, 2,661 other Company employees
were granted a total of 6,411,118 options for ten years at the same price per
share. One of the Named Executive Officers of the Company -- Mr. Steere -- is
also a director of the Company. In addition, Mr. Bessey served as a director of
the Company in 1995. The options received under the Plan by these two Named
Executive Officers in 1995 and the Company's other three Named Executive
Officers -- Drs. McKinnell and Niblack and Mr. Neimeth -- are set forth on page
9 of this Proxy Statement in the table entitled "Option Grants in 1995".

On February 22, 1996, the closing price of the Common Stock traded on the
New York Stock Exchange was $67.875 per share, as reported in THE WALL STREET
JOURNAL.

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STOCK APPRECIATION RIGHTS

The Plan also provides for the granting of stock appreciation rights to the
holders of stock options under the Plan. These rights will entitle the recipient
thereof to elect to receive, in lieu of the exercise of the related option, and
without payment to the Company, (1) a number of shares of Common Stock
determined under a formula set forth in the Plan; or (2) if provided in the
terms of the award, cash as determined under such formula; or (3) a combination
of cash and shares.

STOCK AWARDS

The Plan provides for the granting of stock awards that vest only upon at
least one year of additional service, and which consist of shares of Common
Stock issued to participating employees as additional compensation for their
services to the Company.

In 1995, one executive officer received the right to earn up to a maximum of
5,040 shares of Company Common Stock and eight other Company employees received
the right to earn up to a maximum of 33,040 shares of Company Common Stock in
the aggregate under the Plan. The potential size of these awards will be
determined by using a non-discretionary formula comprised of two performance
criteria (total shareholder return and earnings per share growth relative to the
performance of the Company's Peer Group) measured over performance periods
ranging from two to five years. The performance formula weighs each criterion
equally. To the extent that the Company's performance exceeds the low end range
of the performance of the Peer Group in either or both of the performance
criteria, a varying amount of shares of Common Stock up to the maximum will be
earned by these employees.

In addition, in 1995 two executive officers of the Company received
restricted stock awards under the Plan totaling 2,500 shares which will vest
over a two-year period. Prior to vesting, the shares will be subject to
forfeiture if the executive officers do not continue as Company employees during
the restricted periods unless their employment ends as a result of their
disability, death or a change in control of the Company.

PERFORMANCE UNIT AWARDS

The Plan provides for the granting by the Company of performance unit
awards, consisting of unvested performance units which are credited to
participating employees. The initial value of each unit is determined by
reference to the book or market value of the Common Stock or to the Company's
earnings or such other criteria related to the Company's performance as the Plan
Committees deem appropriate. No performance unit award will vest prior to one
year after the date of the award. Performance unit awards are payable in cash
or, if so provided in the terms of the award, in shares of Common Stock.

TANDEM AWARDS

The Plan provides for the granting of tandem awards consisting of a right of
election among two or more of the following: an option, which may include a
stock appreciation right with respect thereto; a performance unit award; and a
stock award.

In 1995, the Company did not issue any stock appreciation rights,
performance unit awards or tandem awards under the Plan.

TAX CONSEQUENCES

The following discussion addresses certain federal tax consequences in
connection with the Plan. State tax treatment is subject to individual state
laws and is not reviewed in this discussion.

INCENTIVE STOCK OPTIONS

An incentive stock option results in no taxable income to the optionee or a
deduction to the Company at the time it is granted or exercised. If the optionee
retains the stock received as a result of an exercise of a stock option for at
least two years from the date of the grant and one year from the date of
exercise, then the gain is treated as long-term capital gain. If the shares are
disposed of during this

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period, the option will be treated as a non-qualified stock option. The Company
receives a tax deduction only if the shares are disposed of during such period.
The deduction is equal to the amount of taxable income to the optionee.

NON-QUALIFIED STOCK OPTIONS

A non-qualified stock option results in no taxable income to the optionee or
deduction to the Company at the time it is granted. An optionee exercising such
an option will, at that time, realize taxable compensation in the amount of the
difference between the option price and the then market value of the shares.
Subject to the applicable provisions of the Internal Revenue Code (the "Code"),
a deduction for federal income tax purposes will be allowable to the Company in
the year of exercise in an amount equal to the taxable compensation realized by
the optionee.

STOCK APPRECIATION RIGHTS

No income will be recognized by the recipient of a stock appreciation right
until shares representing the amount of the appreciation or the cash equivalent,
if so elected, are transferred to the recipient pursuant to the exercise of the
right. The amount of such income will be equal to the fair market value of such
shares on the exercise date (or the cash equivalent), and will be ordinary
income. Subject to the applicable provisions of the Code, the Company will be
entitled to a deduction at the same time and in the same amount as the employee
realizes ordinary income as a result of the exercise of the right.

STOCK AWARDS

No income will be recognized by the recipient of a stock award if such award
is subject to a substantial risk of forfeiture. Generally, at the time the
substantial risk of forfeiture terminates with respect to a stock award, the
then fair market value of the stock will constitute ordinary income to the
employee. Subject to the applicable provisions of the Code, a deduction for
federal income tax purposes will be allowable to the Company in an amount equal
to the compensation realized by the employee.

PERFORMANCE UNIT AWARDS

The grant of a performance unit award generally will result in taxable
income to the employee on the earlier of actual receipt of compensation pursuant
to the award or when such compensation is credited to the employee's account, or
set apart, or otherwise made available. Subject to the applicable provisions of
the Code, a deduction for federal income tax purposes will be allowable to the
Company in an amount equal to the compensation realized by the employee.

ACCOUNTING TREATMENT

The Company accounts for the issuance of stock-based compensation including
stock options, stock appreciation rights, stock awards and performance unit
awards in accordance with Accounting Principles Board Opinion ("APB") No. 25,
ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES. APB No. 25 requires the accrual of
compensation cost to the extent that the market price of the common stock on the
grant date exceeds the exercise price.

In 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 123, ACCOUNTING FOR STOCK-BASED
COMPENSATION. SFAS No. 123 provides for the recognition of compensation expense
based on the fair value of the stock-based award (the "fair value method"), but
allows companies to continue to measure compensation expense using APB No. 25.
Companies electing to continue to account for stock-based compensation in
accordance with APB No. 25 must make pro forma disclosures of net income and
earnings per share as if the fair value based method had been applied. The
Company plans to continue to account for stock-based compensation under APB No.
25.

STOCK OPTIONS

Under the Plan, the issuance of stock options to employees does not result
in compensation expense since the exercise price of the option may not be less
than the market price of the common stock on the grant date.

27
<PAGE>

STOCK APPRECIATION RIGHTS

Issuance of stock appreciation rights results in compensation cost to the
extent the market price of the common stock exceeds the exercise price of the
rights on the grant date. Compensation cost is subsequently adjusted for
changes, if any, in the market price of the Company's common stock for those
stock appreciation rights which have not yet been exercised. Compensation costs
are expensed over the related service period.

STOCK AWARDS

Stock awarded to employees results in compensation cost equal to the fair
value of the Company's common stock on the grant date. The amount of recorded
compensation cost is not adjusted for changes in the market price of the
Company's common stock subsequent to the grant date.

PERFORMANCE UNIT AWARDS

The accounting treatment for performance unit awards is similar to that used
for stock appreciation rights, except that the amount of compensation cost
recorded is equal to the cash payable or the value of the common shares to be
issued under the award.

ACCOUNTING FOR INCOME TAXES

The compensation cost related to stock options, stock appreciation rights,
stock awards and performance unit awards recorded for financial statement
purposes may differ from the deduction for income tax purposes. The income tax
effect of the difference, if any, generally would be adjusted through additional
paid-in capital.

The language of the Plan amendments to be approved by the shareholders is
set forth in Exhibit 1 to this Proxy Statement. The affirmative vote of a
majority of the shares of Common Stock issued and outstanding, is required for
the adoption of the amendments.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE PROPOSAL TO APPROVE THE
AMENDMENTS TO THE STOCK AND INCENTIVE PLAN TO INCREASE THE NUMBER OF SHARES
AUTHORIZED TO BE ISSUED UNDER THE PLAN AND TO EXTEND THE TERM OF THE PLAN TO
DECEMBER 31, 2005.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT

Section 16 of the Securities Exchange Act of 1934 ("Section 16") requires
that reports of beneficial ownership of Common Stock and changes in such
ownership be filed with the SEC by the Company's directors and executive
officers. The Company is required to conduct a review and to identify in its
proxy statement each director or officer who failed to file any required report
under Section 16 on a timely basis. Based upon that review, the Company has
determined that all required reports were filed on a timely basis for the 1995
fiscal year.

REQUIREMENTS, INCLUDING DEADLINES, FOR SUBMISSION OF PROXY PROPOSALS,
NOMINATION OF DIRECTORS AND OTHER BUSINESS OF SHAREHOLDERS

Under the Company's By-laws, certain procedures are provided which a
shareholder must follow to nominate persons for election as directors or to
introduce an item of business at an annual meeting of shareholders. These
procedures provide that nominations for director nominees and/or an item of
business to be introduced at an annual meeting of shareholders must be submitted
in writing to the Secretary of the Company at 235 East 42nd Street, New York, NY
10017. The nomination or proposed item of business must be received no later
than: (1) 60 days in advance of an annual meeting if it is being held within 30
days preceding the anniversary date of the previous year's meeting, or (2) 90
days in advance of such meeting if it is being held on or after the anniversary
date of the previous year's meeting. With respect to any other annual or special
meeting, the nomination or item of business must be received by the 10th day
following the date of public disclosure of the date of such meeting. The
nomination must contain the following information about the nominee: name, age,
business and residence addresses; principal occupation or employment; the number
of shares of Common Stock

28
<PAGE>

held by the nominee; the information that would be required under the rules of
the SEC in a proxy statement soliciting proxies for the election of such nominee
as a director; and a signed consent of the nominee to serve as a director of the
Company, if elected. Notice of a proposed item of business must include a brief
description of the substance of, and the reasons for, conducting such business
at the annual meeting, the shareholder's name and address, the number of shares
of Common Stock held by the shareholder (with supporting documentation where
appropriate) and any material interest of the shareholder in such business.

The Board is not aware of any matters that are expected to come before the
Annual Meeting other than those referred to in this Proxy Statement. If any
other matter should come before the Annual Meeting, the persons named in the
accompanying proxy intend to vote such proxies in accordance with their best
judgment.

The chairman of the meeting may refuse to allow the transaction of any
business not presented, or to acknowledge the nomination of any person not made,
in compliance with the foregoing procedures.

Under the rules of the SEC, shareholder proposals intended to be presented
at the Company's 1997 Annual Meeting of Shareholders must be received by the
Company at its principal executive offices by November 18, 1996 for inclusion in
the proxy statement and form of proxy relating to that meeting.

MISCELLANEOUS

The cost of soliciting proxies will be borne by the Company. In addition to
the solicitation of proxies by the use of the mails, the Company may use
telephone, telegraph and personal contact. Such solicitation will be made by
regular employees of the Company without additional compensation for such
services. The Company has also engaged Morrow & Co., Inc. to assist in the proxy
solicitation, and has agreed to pay $25,000 plus expenses for such soliciting
services.

By order of the Board,

[SIGNATURE]
C. L. Clemente
SECRETARY

29
<PAGE>
- --------------------------------------------------------------------------------
FOR EDGAR FILING, LANGUAGE THAT WILL BE ADDED IS PRECEDED BY A "<*>" AND
FOLLOWED BY A "</*>". LANGUAGE THAT WILL BE ELIMINATED IS PRECEDED BY A "<#>"
AND FOLLOWED BY A "</#>".
- --------------------------------------------------------------------------------

EXHIBIT 1

PFIZER INC.
STOCK AND INCENTIVE PLAN

(New material underlined; material to be
deleted shown as stricken.)

* * *

3. TOTAL NUMBER OF SHARES

Subject to the provisions of Section 6(h), the maximum amount of stock which
may be issued under the Plan is <#>73,000,000</#> <*>169,000,000</*>* shares of
the Common Stock of the Company (comprised of <#>6,000,000</#>
<*>12,000,000</*>* shares authorized in 1965, <#>6,000,000</#>
<*>12,000,000</*>* shares authorized in 1969, <#>6,000,000</#>
<*>12,000,000</*>** shares authorized in 1972, <#>6,000,000</#>
<*>12,000,000</*>** shares authorized in 1975, <#>6,000,000</#>
<*>12,000,000</*>** shares authorized in 1980, <#>10,000,000</#>
<*>20,000,000</*>*** shares authorized in 1983<*>,</*> <#>and 11,000,000</#>
<*>22,000,000</*>*** shares authorized in 1986, <#>11,000,000</#>
<*>22,000,000</*>*** shares authorized in 1989<*>,</*> <#>and 11,000,000</#>
<*>22,000,000</*>**** shares authorized in 1992<*>, and 23,000,000 shares
authorized in 1996</*>). No participant shall be granted (i) options which would
result in such participant receiving more than <#>120,000</#> <*>240,000</*>*
shares of the total number of shares authorized in 1965, more than
<#>120,000</#> <*>240,000</*>* shares of the total number of shares authorized
in 1969, or more than <#>120,000</#> <*>240,000</*>** shares of the total number
of shares authorized in 1972, or (ii) options or awards which would result in
such participant receiving more than <#>120,000</#> <*>240,000</*>** shares of
the total number of shares authorized in 1975, more than <#>200,000</#>
<*>400,000</*>** shares of the total number of shares authorized in 1980, more
than <#>200,000</#> <*>400,000</*>*** shares of the total number of shares
authorized in 1983, more than <#>300,000</#> <*>600,000</*>*** shares of the
total number of shares authorized in 1986, more than <#>300,000</#>
<*>600,000</*>*** shares of the total number of shares authorized in 1989, more
than <#>300,000</#> <*>600,000****</*> shares of the total number of shares
authorized in 1992, <*>more than 600,000 shares of the total number of shares
authorized in 1996,</*> or (iii) any option, stock award or performance unit
award which would result in ownership by such participant of more than five
percent of the stock of the Company within the meaning of Section 422(b)(7) of
the Internal Revenue Code, or (iv) [i] any incentive stock option, as defined in
Section 422A(b) of the Internal Revenue Code, granted on or before December 31,
1986, which would result in such participant receiving a grant of incentive
stock options in any calendar year for stock exceeding $100,000, in aggregate
fair market value, determined as of the time the option is granted, plus any
unused limit carryover, as defined in Section 422A(c)(4) of the Internal Revenue
Code, to the year in which such option is granted or [ii] any incentive stock
option granted after December 31, 1986, which would result in such participant
receiving a grant of incentive stock options for stock that would have an
aggregate fair market value in excess of $100,000, determined as of the time
that the option is granted, that would be exercisable for the first time by such
participant during any calendar year. No option with respect to any shares
authorized in 1975 shall be granted to the extent that shares authorized in 1972
are available therefor, or with respect to any shares authorized in 1980 to the
extent that shares authorized in 1972 or shares authorized in 1975 are available
therefor, or with respect to any shares authorized in 1983 to the extent that
shares authorized in 1972, 1975 or 1980 are available therefor, or with respect
to any shares authorized in 1986 to the extent that shares authorized in 1972,
1975, 1980 or 1983 are available therefor, or with respect to any shares
authorized in 1989 to the extent that shares authorized in 1972, 1975, 1980,
1983, or 1986 are available therefor, or with respect to any shares authorized
in 1992 to the extent that shares authorized in 1972, 1975, 1980, 1983, 1986 or
1989 are available therefor <*>or with respect to any shares authorized in 1996
to the extent that shares authorized in 1972, 1975, 1980, 1983, 1986, 1989, or
1992 are available therefor</*>. With respect to all options and stock awards
granted on or after January 1, 1972, the records of the Company shall specify
the number of shares authorized in 1965, the number of shares authorized in
1969, the number of shares authorized in 1972, the number of shares authorized
in 1975, the number of shares authorized in 1980, the number of shares
authorized in 1983, the number of shares authorized in 1986, the number of
shares authorized in 1989<*>,</*> <#>and</#> the number of shares authorized in
1992 <*>and the number of shares authorized in 1996</*> covered by such options
or awards. None of the shares authorized in 1965, 1969 or 1972 shall be
available for stock awards.

<PAGE>
* * *

5. TERM OF PLAN

No option with respect to shares authorized in or prior to 1969 under this
Plan shall be granted pursuant to this Plan after December 31, 1978, no option
with respect to shares authorized in 1972 shall be granted pursuant to this Plan
after December 31, 1992, no option, stock appreciation right or stock award,
with respect to shares authorized in 1975 shall be granted pursuant to this Plan
after December 31, 1992, no option, stock appreciation right, stock award,
performance unit award or tandem award with respect to shares authorized in 1980
shall be granted pursuant to this Plan after December 31, 1992, no option, stock
appreciation right, stock award, performance unit award or tandem award with
respect to shares authorized in 1983 shall be granted pursuant to this Plan
after December 31, 1992, no option, stock appreciation right, stock award,
performance unit award or tandem award with respect to shares authorized in 1986
shall be granted pursuant to this Plan after December 31, 1995, no option, stock
appreciation right, stock award, performance unit award or tandem award with
respect to shares authorized in 1989 shall be granted pursuant to this Plan
after December 31, 1998, no option, stock appreciation right, stock award,
performance unit award or tandem award with respect to shares authorized in 1992
shall be granted pursuant to this Plan after December 31, 2001<*>, no option,
stock appreciation right, stock award, performance unit award or tandem award
with respect to shares authorized in 1996 shall be granted pursuant to this Plan
after December 31, 2005</*>, but options, stock appreciation rights, performance
unit awards, tandem awards and restrictions on awards may extend beyond such
dates.

* * *

- ------------------------
* Adjusted for the three-for-one stock split in 1970, the two-for-one stock
split in 1983<*>,</*> <#>and</#> the two-for-one stock split in 1991<*>,
and the two-for-one stock split in 1995</*>.

** Adjusted for the two-for-one stock split in 1983, <#>and</#> the
two-for-one stock split in 1991<*>, and the two-for-one stock split in
1995</*>.

*** Adjusted for the two-for-one stock split in 1991 <*>and the two-for-one
stock split in 1995</*>.

<*>****</*> <*>Adjusted for the two-for-one stock split in 1995.</*>

<PAGE>

[Map indicating location of meeting site]

MEETING SITE AREA PFIZER

The Grand Hyatt Hotel is serviced by Metro North Annual Meeting of
and by the following subway lines going into Grand Shareholders
Central Terminal:
April 25, 1996
EAST SIDE: IRT (Lexington Avenue) Nos. 4, 5 & 6 10:00 am

WEST SIDE: IRT (7th Avenue Line) Nos. 1, 2, & 3 to
42nd Street then transfer east on either:
Flushing Line No. 7 or
S (Shuttle)

[logo] RECYCLED PAPER WITH A MINIMUM
OF 10% POST CONSUMER WASTE
<PAGE>
PFIZER INC.
PROXY
SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS
APRIL 25, 1996, 10:00 A.M.
AT THE GRAND HYATT HOTEL
42ND STREET AND LEXINGTON AVENUE
NEW YORK, NY
THE UNDERSIGNED HEREBY APPOINTS
WILLIAM C. STEERE, JR., HENRY A.
MCKINNELL, JR., AND C.L.
CLEMENTE, AND EACH OF THEM, AS
PROXIES, EACH WITH FULL POWER OF
SUBSTITUTION, AND HEREBY
AUTHORIZES THEM TO REPRESENT AND
TO VOTE, AS DESIGNATED ON THE
REVERSE SIDE OF THIS FORM, ALL
THE SHARES OF COMMON STOCK OF
PFIZER INC. HELD OF RECORD BY THE
UNDERSIGNED ON FEBRUARY 26, 1996,
AT THE ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON APRIL
25, 1996 AT 10:00 A.M. AT THE
GRAND HYATT HOTEL, 42ND STREET
AND LEXINGTON AVENUE, NEW YORK,
NY, OR ANY ADJOURNMENT THEREOF.

IF NO OTHER INDICATION IS MADE ON
THE REVERSE SIDE OF THIS FORM,
THE PROXIES SHALL VOTE FOR ITEMS
NUMBER 1, 2 AND 3 AND, IN THEIR
DISCRETION, UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING.

(CONTINUED ON REVERSE SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
PFIZER INC.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1, 2 3.A proposal to approve amendments to the Pfizer Inc. Stock
AND 3. and Incentive Plan to increase the number of shares of
1.Election of Directors. (Mark ONE box only). Pfizer Inc. Common Stock authorized to be issued under the
Nominees: Constance J. Horner, Thomas G. Labrecque, and Plan and to extend the term of the Plan to December 31,
Jean-Paul Valles. 2005. (Mark ONE box only).
/ / FOR all nominees, / / Vote WITHHELD FOR AGAINST ABSTAIN
except vote withheld from all nominees / / / / / /
from the following IF ACTING AS ATTORNEY, EXECUTOR, TRUSTEE, OR IN OTHER
nominees (if any): REPRESENTATIVE CAPACITY, PLEASE SIGN NAME AND TITLE.
//96
2.A proposal to approve the appointment of KPMG Peat Marwick ------------------------------------------------------------
LLP to serve as independent auditors for 1996. (Signature of Shareholder) Date
(Mark ONE box only). //96
FOR AGAINST ABSTAIN ------------------------------------------------------------
/ / / / / / (Signature, if held jointly) Date
Please sign, date, and return this proxy form in the
enclosed return envelope. Thank you.
</TABLE>