Analysts expect cost control to be a major factor in third-quarter earnings as Big Pharma begins releasing results this week on the heels of recent upper management housecleaning measures within the sector.

Banc of America analyst Chris Schott forecast that Big Pharma will be able to report at least inline sales, and show better-than-expected sales growth in some cases. However, the he said the earnings focus will be on expense control.

"With signs of increased cost cutting and an emerging pipeline, we have become incrementally more positive on the group," Schott said in a research note.

The analyst expects both Merck and Wyeth to come out ahead of analysts' consensus by 3 cents per share, and Pfizer by 1 cent per share.

At investment firm Deutsche Bank, analyst Barbara Ryan said management shake-ups at Big Pharma within the past year make cost cutting more imperative.

The analyst said in a note that the new chief executive at Pfizer, Jeff Kindler, will likely "raise the ante" with new initiatives to cut costs at the world's largest drug maker, causing a ripple effect through the sector.

In September, Bristol-Myers Squibb joined Big Pharma's housecleaning trend by ousting CEO Peter Dolan on the recommendation of federal monitors. Pfizer replaced CEO Hank McKinnell in July, and Merck's CEO Raymond Gilmartin vacated his post early last year.

"The new guard understands that they must improve earnings, or suffer a similar fate, hence aggressive cost cutting is already under way and will likely intensify in the near term, as (Pfizer's) new management team, under the leadership of its new CEO, Jeff Kindler, take a more urgent and substantial strike at their cost base," Ryan said in a recent note.

Ryan lists Merck, Pfizer, and Schering-Plough as her top picks.

Merrill Lynch's David Risinger expects third-quarter earnings for Big Pharma to be generally ahead of expectations. The analyst bases his optimism on an acceleration in U.S. sales volume and progress in cost cutting.

Risinger expects Bristol-Myers, Merck, Pfizer and Wyeth to report earnings per share ahead of consensus.

Analysts surveyed by Thomson Financial expect third-quarter earnings per share of 45 cents for Pfizer, 20 cents for Bristol-Myers, 79 cents for Lilly, 80 cents for Wyeth, 15 cents for Schering-Plough, and 50 cents for Merck.