DISEASE CHARACTERISTICS:

Inclusion Criteria:

- Clinical stage I, II, or III operable invasive mammary carcinoma, confirmed by
histological analysis

- Measurable residual tumor at the primary site

- Measurable disease is defined as any mass that can be reproducibly measured
by physical examination, mammogram, and/or ultrasound and can be accurately
measured in at least one dimension (longest diameter to be recorded) as 10
mm (1 cm)

- Available core biopsies from the time of diagnosis

- May include sections of paraffin-embedded material

- Scheduled to undergo surgical treatment with either segmental resection or total
mastectomy

- Prior history of contralateral breast cancer allowed if patient has no evidence of
recurrence of their initial primary breast cancer within the last 5 years

- HER2-positive by Herceptest (3+) or FISH

- ER-positive and/or PR-positive by IHC

Exclusion Criteria:

- Locally recurrent breast cancer

- Evidence of distant metastatic disease (i.e., lung, liver, bone, or brain metastases)

PATIENT CHARACTERISTICS:

Inclusion Criteria:

- Female

- Postmenopausal, as defined by any of the following:

- At least 55 years of age

- Under 55 years of age and amenorrheic for at least 12 months OR
follicle-stimulating hormone (FSH) values ≥ 40 IU/L and estradiol levels ≤ 20
IU/L

- Prior bilateral oophorectomy or prior radiation castration with amenorrhea for
at least 6 months

- ECOG performance status 0-1

- ANC ≥ 1,000/mm³

- Platelet count ≥ 100,000/mm³

- Creatinine ≤ 1.5 times upper limit of normal (ULN)

- Bilirubin ≤ 1.5 times ULN

- AST and ALT ≤ 1.5 times ULN

- Able to swallow and retain oral medication

- Cardiac ejection fraction normal by echocardiogram (or MUGA scan if an echocardiogram
cannot be performed or is inconclusive)

Exclusion Criteria:

- Premenopausal breast cancer, pregnant, or lactating

- Serious medical illness, that in the judgment of the treating physician, places the
patient at high risk of operative mortality

- Malabsorption syndrome, disease significantly affecting gastrointestinal function, or
resection of the stomach or small bowel

- Ulcerative colitis

- History of other malignancy

- Patients who have been disease-free for 5 years, or patients with a history of
completely resected non-melanoma skin cancer or successfully treated in situ
carcinomas are eligible

- Active or uncontrolled infection

- Dementia, altered mental status, or any psychiatric condition that would prohibit the
understanding or rendering of informed consent

- Known history of uncontrolled or symptomatic angina, arrhythmias, or congestive heart
failure

PRIOR CONCURRENT THERAPY:

Exclusion Criteria:

- Prior chemotherapy for primary breast cancer

- Tamoxifen or raloxifene as a preventive agent within the past 21 days

- Hormone replacement therapy (e.g., conjugated estrogens tablets [Premarin]) within
the past month

- Prior therapy with anthracyclines

- Investigational drug within the past 30 days or 5 half-lives, whichever is longer

- Concurrent anti-cancer therapy (chemotherapy, radiation therapy, surgery,
immunotherapy, hormonal therapy, or any other biologic therapy) other than letrozole

- Concurrent treatment with an investigational agent