The company, whose best-selling Lipitor cholesterol fighter lost U.S. patent protection on November 30, said the new stock repurchases will be in addition to an estimated $500 million to $2.5 billion worth of authorized buybacks remaining from its current repurchase program.

As of November 1, Pfizer had purchased $6.5 billion worth of stock this year, or 332 million shares, toward its goal of buying back $7 billion to $9 billion worth of shares during the full year.

The company said it expects to repurchase about $5 billion of its common stock in 2012. It said the remaining authorized amounts would be available for stock repurchases in 2013 and beyond.

New York-based Pfizer raised its first-quarter dividend to 22 cents per share, from 20 cents per share in each quarter of 2011.

JPMorgan analyst Chris Schott said the size of the dividend increase and the new authorization for stock buybacks were roughly in line with his expectations.

Schott, citing data from IMS Health, said generics represented 14.6 percent of the overall U.S. Lipitor market in their first week after reaching U.S. drugstores. He predicted the copycats will continue gaining ground and capture a 60 percent market share within the next six months.

Pfizer is relying heavily on share buybacks and dividends to retain investors and attract new ones as U.S. sales of Lipitor continue to plunge with the arrival of cheaper generic forms of the $10 billion-a-year drug.

Some investors remain anxious whether growing sales of other Pfizer drugs and launches of new medicines will adequately offset lost sales of Lipitor.

"The dividend increase and new share repurchase program are a testament to our continued commitment to enhancing shareholder value and our continued confidence in the business," Pfizer Chief Executive Ian Read said in a release.

Pfizer shares fell 1.1 percent to $20.33 in early afternoon trading on the New York Stock Exchange, in line with declines for the drug sector.