With investors booing the proposed $23 billion merger between Monsanto Co. and Pharmacia & Upjohn Inc. and the $50 billion merger between Warner-Lambert Co. and American Home Products Corp., both deals appear in jeopardy of falling apart.

And whatever the outcome, pharmaceutical industry executives may now be wary of merging with a same-size rival for fear of disappointing investors with a low price, as in Monsanto's case, or opening the door to an unwanted suitor, as in Warner-Lambert's case.

"The Warner-Lambert and Monsanto transactions raise fundamental questions regarding the viability of mergers of equals," said Todd Warnock, a health-care analyst at Credit Suisse First Boston. "Given the market reaction to both of these deals, boards of directors will be more circumspect before pursuing such a partner."

Many investors believe these tough questions are now facing the boards of companies such as Schering-Plough Corp., SmithKline Beecham PLC and Eli Lilly and Co., which are often rumored to be merger candidates.

Competition between drugmakers is fierce. Companies need huge amounts of money to discover blockbuster medicines, and big sales teams to market them. Additionally, the patents on many top-selling drugs are expiring, and companies will quickly face competition from cheaper generic forms.

But investors, who have watched drug stocks decline an average of 14 percent this year, want a merger to offer them a premium for their shares in the target company. And investors in the acquiring company want clear cost savings and synergies that will drive profits.

Monsanto and Pharmacia & Upjohn were both seen as takeover targets, and their shareholders were expecting offers at a premium--not flat stock swaps as was announced this past Sunday night. What's more, many investors in Pharmacia don't want Monsanto's agricultural-chemical business, which is facing a backlash from consumers who have safety concerns about genetically engineered food.

Monsanto's agricultural-chemical business "is adding risk to the business," explains Judith Miller, portfolio manager for the John Hancock Global Health Sciences Fund, which is a shareholder in Pharmacia & Upjohn. "It's a lower-margin business that's going to take a lot of attention. The earnings potential and growth potential are not that strong. I don't think Pharmacia shareholders wanted to diversify into that business."

Pharmacia's shares slid 11 percent last week, while Monsanto's dropped 7 percent.

Executives of both companies say a combined operation would accelerate sales of their two leading drugs--Pharmacia's Xalatan, a glaucoma drug, and Monsanto's Celebrex, the top-selling arthritis medicine. The executives also insist their merger would help them develop new drugs because they would have a larger research budget.

Investors are hearing a similar spiel from executives at American Home Products and Warner-Lambert. American Home Products, which still is mired in litigation regarding its recalled diet drug, has seen its shares--and the value of its merger--slide 22 percent since the deal was announced Nov. 4.

Investors initially liked the idea of uniting Warner-Lambert, which makes Certs mints, Schick razors and many prescription medicines, including Lipitor, the best-selling drug to lower cholesterol, together with American Home Products, which is behind household names such as Advil and Robitussin, and the top-selling hormone replacement drug Premarin.

But a higher offer from Pfizer Inc. changed their minds. Pfizer, which makes the impotence treatment Viagra, offered stock now worth $73 billion, which is 46 percent richer than the offer from American Home Products.

"Given the very large difference in price, I have a fiduciary duty; I would have to vote for the Pfizer proposal," said Michael Kagan, manager of the Salomon Brothers Fund, which owns shares in Warner-Lambert and American Home Products.

But it's not that simple. Pfizer, Warner-Lambert and American Home Products have taken their fight to court. Pfizer is challenging two provisions in the contract between Warner-Lambert and American Home Products: a $2 billion breakup fee, and a stock purchase agreement that would prevent Pfizer from using a favorable accounting treatment.

Pfizer also has launched a proxy fight to throw out Warner-Lambert's board of directors.

"It's gotten ugly," said Miller, who owns shares in all three companies.

While the stories unfold, rivals may put their own merger plans on hold, worried they too could find themselves in a very unequal merger of equals.