As Pfizer celebrates its proposed $68 billion acquisition of Wyeth, investors seem less enthusiastic about the deal and the New York-based giant’s shares have fallen 10.3% amid concerns about the additional debt the company is taking on to achieve the deal.

Not unreasonably, Pfizer was extremely enthusiastic about the proposed purchase and chief executive Jeffrey Kindler said that the combination of the two firms “will meaningfully deliver Pfizer’s strategic priorities in a single transaction”. It certainly eases concerns about the patent cliff that Pfizer is staring at, especially in 2011, when its blockbuster cholesterol drug Lipitor (atorvastatin) faces generic competition in the USA.

Mr Kindler noted that "investors have been rightfully concerned about when Lipitor goes off patent" and the Wyeth buy “definitively addresses that”. The deal also makes Pfizer a major player in vaccines and biologics, principally through the pneumococcal disease jab Prevnar and the arthritis and psoriasis therapy Enbrel (etanercept), and heralds its return to consumer health.

Pfizer now says that its earnings for 2012 should now be about 20% above analyst estimates. Nevertheless, investors are concerned, not least because Pfizer announced that it is halving its dividend to $0.16, the first time in 42 years that it has not been raised.

There are also worries about the debt Pfizer has taken on to finance the deal, having secured $22.5 billion in funding from a consortium of banks. Standard & Poor's said it expects to cut Pfizer's credit rating to ‘AA’, the third highest investment grade, if the Wyeth deal is completed as planned, while Moody's Investors Service notes that it may reduce the firm to ‘A1’, the fifth highest level.

The fact that Pfizer can get access to such funds is impressive in the current financial climate but if its credit rating falls further, the deal could still collapse. It has been reported that Wyeth would have to pay Pfizer a $1.8 billion break-up fee if it walks away from the deal, while the latter would be hit with a $4.5 billion fee.

The two companies also announced their financials for the fourth quarter and details about job cuts which you can find in the accompanying articles on today’s elert.