Genetically
 Manipulated 


 

 
 
 Food


 News

16 November 99

Table of Contents

Human protein from GM pigs' semen ejaculate for new drugs
GM Pigs Might be Human Drug Source
GM Crop Releases By Mistake
Burson-Marsteller: PR for the New World Order
the "Online Corporate Spy Network" web page
A new list server on Standards
About Monsanto
Monsanto faces its many options
Monsanto Options: Pros and Cons
Monsanto Ad: Life Sciences On Life Support

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Date: 13 Nov 1999 09:34:55 -0600
From: mail@icsenglish.com
From: "NLP Wessex" nlpwessex@bigfoot.com

Human protein from GM pigs' semen ejaculate for new drugs

And what exactly happens when one of these pigs (Farmers Weekly, UK, 12 November 99) gets mixed up by mistake with regular pigs and starts breeding?

Can you guarantee it won't happen when GM animals and plants are being developed on a daily basis across the globe, including in countries with no monitoring sytems at all?

There have already been mistaken releases of GM crops because people thought they were working with normal crops when the batches got mixed up (see additional story at end), to say nothing of GMOs entering the food chain fraudulently (see FBI investigations at http://www.btinternet.com/~nlpwessex/Documents/fbigminvestigations.htm ).

Despite international regulation we already know that weapons grade nuclear material is flowing freely around the world as a result of the collapse of the former Soviet Union driven by the activities of criminal commercial opportunists. Why should the situation be any different with GMO's?

Unlikely hysterical scenario?

Well, in another article in the same issue Farmers Weekly, not known for its alarmist reporting, publishes a story which highlights food-chain bio-hazard issues arising from the disbanding of the former Soviet 'Biopreparat' biological weapons programme. In additon to drawing attention to trans-national criminal syndicates and anti-crop bio-weapons Farmers Weekly quotes a former British Intelligence officer as asking: "Where have the Biopreparat scientists and technicians gone and what are they doing?"

The biotech industry's own unique formula for the future of the planet is now as follows:

   (irresponsible and ignorant 'science')
+ (economic greed)
+ (political naivity on the ability to regulate)
+ (human error)

= "recipe for disaster"

Who can guarantee the security of even one of these functions in the formula, let alone all of them?

We can't even successfully regulate 'normal' animal feed rations in Europe. Sewage in French cattle feed is just the appetiser.

There is going to be an overwhelming flood of tears if we don't get a grip of this situation quickly.

BSE was a picnic.

No government or international agency, however well intentioned, can possibly handle these types of development. As a species the human race has lost its way. An alternative solution which transcends these problems is urgently required (see http://www.btinternet.com/~nlpwessex/Documents/scientis.htm ).

NATURAL LAW PARTY WESSEX
nlpwessex@bigfoot.com    http://www.btinternet.com/~nlpwessex


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Date: 13 Nov 1999 09:34:55 -0600
From: mail@icsenglish.com

GM Pigs Might be Human Drug Source

Farmers Weekly 12 November 1999

SCIENTISTS have genetically engineered mice to produce human proteins in their semen, and believe the technique could be used to pro- duce drugs from genetically modi- fied livestock, particularly pigs.

According to reports on the BBC News website, research at Laval University, Canada, has produced mice which secrete human growth hormone in their ejaculate. Scientists believe that boars, which can produce up to half a litre of semen at a time, could produce pharmaceutical pro- teins cost-effectively.

Trials are already under way, and researchers believe they could have a herd of 60 pigs producing proteins within two years.

Mice were engineered to produce human growth hormone using a DNA sequence which is only active in male sex glands. The sequence was linked to one which encodes for human growth hormone, and the combined sequence was injected into fertilised mouse eggs.


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Date: 13 Nov 1999 09:34:55 -0600
From: mail@icsenglish.com

GM Crop Releases By Mistake

By Natural Law Party Wessex
nlpwessex@bigfoot.com    http://www.btinternet.com/~nlpwessex
18 October 1999 22:14

Anybody who thinks that careful regulation will be enough to ensure that unapproved GM products do not get into the global food chain either by mistake or fraudulently will have to think once again if this story is confirmed.

This is not the first time this has happened. Similar incidents have already happened with unapproved oilseed rape and sugar beet GM varieties in supposedly highly regulated developed world countries. See: http://www.natural-law.ca/genetic/NewsNov-Dec97/GENews12-4beetmistake.html http://www.btinternet.com/~nlpwessex/Documents/canola.htm

And these are just the cases which got found out.

Who's kidding who here?


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Date: 13 Nov 1999 14:52:57 -0600
From: Robert Mann robt_m@talk.co.nz

The depraved trade of PR has more influence regarding GE than in perhaps any other important issue. Here is a very good article about this very important sordid mess of hired deceivers.

Robt Mann
P O Box 28878 Remuera, Auckland 1005, New Zealand
(9) 524 2949

Burson-Marsteller: PR for the New World Order

by: Carmelo Ruiz

Sections:
The largest PR firm
Human Rights, Anyone?
Corporate Environmentalism
Dirty Tricks and Front Groups
Selling NAFTA
The Contra Connection
B-M, Mexico and the Neoliberal Project
Destroying Health Care
What can we do?
References

The largest PR firm

The public relations (PR) business is one of the fastest growing industries in the global market economy. In order to face perils like labor unions, organized consumer activists and environmental groups, governments and corporations have come to rely more on slick PR campaigns. The peril to popular democracy posed by PR firms should not be underestimated. Using the latest communications technologies and polling techniques, as well as an array of high-level political connections, PR flacks routinely "manage" issues for government and corporate clients and "package" them for public consumption. The result is a "democracy" in which citizens are turned into passive receptacles of "disinfotainment" and "advertorials" and in which critics of the status quo are defined as ignorant meddlers and/or dangerous outsiders.

Burson-Marsteller (B-M) is the world's largest PR firm, with 63 offices in 32 countries and almost $200 million in income in 1994. Although its name is unknown to most people – even to many in activist circles – B-M is fast becoming an increasingly important cog in the propaganda machine of the new world order.

Human Rights, Anyone?

On the human rights front, B-M has represented some of the worst violators of our age. These include:

Ideological barriers are no object. B-M also represented the late communist Romanian despot Nicolae Ceaucescu. Other third world human rights violators that have been represented by B-M include the governments of Singapore and Sri Lanka.

Doesn't this bother the consciences of B-M's executives? Not at all. Commenting on his firm's work for Argentina's fascists, B-M founder Harold Burson said that "We regard ourselves as working in the business sector for clearcut business and economic objectives. So we had nothing to do with a lot of the things that one reads in the paper about Argentina as regards human rights and other activities".

Corporate Environmentalism

For years B-M has been involved in major environmental issues all over the world, not hesitating to give polluters a helping hand when confronted by activist groups and/or government regulations. Many transnational corporations have turned to B-M for help in the creation of a pedantic, elitist and corporate-oriented brand of environmentalism. It is the hope of entrepreneurial sectors and neoliberal demagogues that this type of safe and harmless environmental activism will displace the more militant and agressive grassroots groups.

B-M's environmental services have benefited industrial polluters, such as the following:

According to Canadian journalist Joyce Nelson, B-M has for years "represented top nuclear power/nuclear weapons contractors such as

In fact, Canada's first Candu [nuclear] reactor sale to Argentina in the early 1970's was later renegotiated during the reign of the military junta, for whom Burson-Marsteller did an image-cleanup from 1976-1981". In addition to this, since 1993 B-M subsidiary Black, Manafort, Stone & Kelly (see sidebar) has been representing Nordion International, a newly-privatised subsidiary of Atomic Energy of Canada Ltd., Canada's state-owned nuclear power company.

B-M coordinated the oil industry's campaign to discredit and destroy president Clinton's proposal for a BTU tax.

A B-M executive sits on the board of Keep America Beautiful, a front for the packaging and waste hauling industries that lobbies against mandatory recycling laws, especially the passage of a national bottle bill in the US.

B-M's most powerful and influential 'environmental' client is the Business Council for Sustainable Development (BCSD), an eco-capitalist outfit founded by Swiss banker Stephan Schmidheiny. A leading theorist and advocate of neoliberal dogma and corporate environmentalism, Schmidheiny agressively combines entrepreneurship and statesmanship. He is a board member of Nestles a director and shareholder (5% owner) of B-M client Asea Brown Boveri. BCSD's original task was to act behind the scenes at the 1992 Earth Summit, which was chaired by the current head of B-M client Ontario Hydro Maurice Strong, to neutralize and silence any voices critical of the irresponsible behavior of polluting corporations. In the words of Joyce Nelson, "With the able assistance of public relations giant Burson-Marsteller, a very elite group of business people (including B-M itself) was seemingly able to plan the agenda for the Earth Summit with little interference from NGO's or government leaders".

Nowadays BCSD is advocating free markets and unfettered corporate activity as the only salvation of the environment. Its members include the CEO's of

Dirty Tricks and Front Groups

B-M was hired by the pharmaceutical corporation Eli Lilly and Monsanto subsidiary Nutra Sweet to promote the use of the genetically-engineered synthetic bovine growth hormone rBGH. This hormone, which increases milk output in cows, is strongly opposed by dairy farmers and consumer and environmental activist groups. Their two main arguments are that

  1. There is already a milk glut in the US. To bring more of it into the market would depress prices so severely that small dairy farmers would be run out of business; and

  2. the use of rBGH has already been linked to severe health problems in cows and to calves born with grotesque birth defects.

B-M's campaign to neutralize the opposition to rBGH included the use of spies to penetrate activist groups. This fact became public when University of Vermont spokesperson Nicola Marro admitted that a mole had been placed in an anti-rBGH ad-hoc group headed by Jeremy Rifkin, a well-known critic of biotechnology and author of several books. Participants in the group singled out a woman named Diane Moser as a suspect. Moser, who attended a Washington DC meeting of the group, avoided small talk and read a paperback during the meeting. Vermont state representative Andrew Christiansen, who a ttended the meeting, told journalist John Dillon that "She said she represented housewives concerned about BGH ... I had suspicions immediately. I've never seen anybody with a paperback coming to a meeting like that". When the activists called the number she left in the sign-up sheet, it rang in the Washington DC offices of Burson-Marsteller. B-M executive Timothy Brosnahan acknowledged that Moser was a B-M employee but denied knowing of any snooping on her part.

A freedom of information act (FOIA) request by activists Tim Atwater and John Stauber, who were then with Rural Vermont and the Foundation on Economic Trends respectively, uncovered a broader pattern of espionage against foes of rBGH. Atwater and Stauber's FOIA request uncovered documents of the quasi-governmental, farmer-funded National Dairy Board (NDB), which promotes rBGH. These documents revealed that the NDB hired the PR firm of Creswell, Munsell, Fultz & Zirbel (CMF&Z). This firm is a subsidiary of communications conglomerate

Young & Rubicam (Y&R), which happens to be B-M's parent company. Given that Y&R represents rBGH backer Monsanto, Stauber concluded that "The day-to-day work is done out of Burson-Marsteller and CMF&Z. But I'm sure there's overall coordination with Young & Rubicam". Stauber is now editor of PR Watch, a newsletter that provides critical reporting on the PR industry, and is co-author, along with Sheldon Rampton, of Toxic Sludge is Good for You: Lies, Damn Lies and the Public Relations Industry (Common Courage Press, 1995).

B-M works for Hydro-Quebec (H-Q) promoting the James Bay 2 project. If the final stages of the construction of James Bay 2 are finished, it will become the most destructive hydroelectric project in the history of North America, disrupting the ecological balance of an area the size of France and permanently displacing the Cree and Inuit indigenous populations in the area. To undermine grassroots opposition to James Bay 2, B-M created a phony group of concerned citizens called the Coalition for Clean and Renewable Energy (CCRE), which was headed by Harvey Schultz, former head of New York City's department of environmental protection. According to John Dillon,"Schultz, Burson-Marsteller, and (CCRE) have hosted briefing sessions for academics, and business and community leaders – opinion makers who can carry the good word about Hydro-Quebec back to their institutions".

The state of Vermont has proved particularly reluctant to buy electricity from H-Q because of pressure from local activists. In order to counteract this threat, B-M hired the Vermont law firm of Sherman & Kimbell to lobby the state government in favor of electricity purchases from H-Q. This law firm registered as a foreign agent under the Foreign Agents Registration Act, which requires America n lobbyists to list their foreign clients and how much they're being paid to represent them. However, since B-M itself has refused to register as a foreign agent for H-Q, most of its work for the James Bay 2 project remains a secret.

Selling NAFTA

In 1990 the Mexican government hired B-M to sell NAFTA to the American public, media and politicians. B-M subcontracted this job to one of its subsidiaries, The Brock Group (TBG), a consulting firm that has done work for American Express, Bell Atlantic, Bacardi, Toyota and the Taiwanese government. TBG is headed by former senator, Republican National Committee chairman, US trade representative and labor secretary William Brock. He was certainly qualified for the job. As US trade representative, Brock engineered the Caribbean Basin Initiative and the US-Israel Free Trade Agreement, and began the negotiations that would eventually culminate in the signing of the US-Canada Free Trade Agreement.

William Brock co-chairs the Multilateral Trade Negotiations (MTN) Coalition, which was founded in 1990 to 'educate' the public – and lobby for – the now-completed Uruguay Round of the General Agreement on Tariffs and Trade (GATT). The coalition's members include American Express, General Motors, IBM, General Electric, Cargill, Citicorp, Procter & Gamble and other companies and trade associations. According to Malaysian activist Martin Khor Kok Peng, the MTN Coalition had a big influence on the 1990 G-7 Summit meeting held in Houston, USA, in which GATT figured prominently. At the Houston Summit, MTN held a high-profile press conference and released a report by an 'eminent persons group' on world trade.

The Contra Connection

One of TBG's top executives happens to be former Miami businessman and ambassador to Venezuela Otto Reich. During the Reagan administration, the Cuban-born Reich headed the USstate department's Office of Public Diplomacy (OPD), whose task was to disseminate disinformation about the Sandinistas and discourage reporting critical of the contras. This outfit, whose operations were later found to be illegal by the US General Accounting Office, was staffed with five psychological warfare specialists from the 4th Psychological Operations Group of Fort Bragg. According to John Stauber and Sheldon Rampton, "the OPD...helped spread a scurrilous story that some American reporters had received sexual favors from Sandinista prostitutes in return for writing slanted stories". In 1987, after the US Congress shut down the OPD, congressman Jack Brooks called it "an important cog in the (Reagan) administration's effort to manipulate public opinion and congressional action".

Interestingly enough, the OPD was conceived at an August 1983 meeting between then CIA director William Casey and a small group of PR industry executives. The meeting, whose purpose was to create a propaganda strategy for the Nicaraguan contras, was attended by B-M senior vice-president Kenneth D. Huszar and Philip Morris publicist James Bowling, who later moved to B-M. Their advice to Casey included the creation of a communications function within the White House, a recommendation that led to the creation of the OPD.

B-M, Mexico and the Neoliberal Project

B-M's success in insuring the passage of NAFTA encouraged the Mexican governing elite to retain the firm's services. It now has a luxurious office in the posh Colonia Anzures district on Mexico City that caters to customers like the Council of Businessmen, the National Stockbrokers' Association, the ministry of commerce and industrial development, and the Office of the President of the Republic. In addition to this, B-M parent Young & Rubic am rakes in over $100 million every year from Mexican clients.

It is not an exaggeration to say that the credibility of the neoliberal project in the western hemisphere hinges on Mexico. Businessmen, politicians and neoliberal ideologues all over the hemisphere have touted Mexico as a symbol of capitalist success because of its privatization policy and its faithful adherence to the economic formulas prescribed by multilateral development banks (a.k.a. the Bretton Woods institutions). After the massive expenditure of political energy in getting NAFTA passed, business elites in both Mexico and the US are hard-pressed to put on a convincing performance in order to give credibility to future trade agreements. Bringing Guatemala and Chile into NAFTA has already be come an agenda item.

However, neoliberal designs for Mexico are endangered by a series of crises, including the blatantly fraudulent elections of 1994, the embarassing collapse of the peso, revelations of drug-related corruption that compromise the Mexican elite all the way up to the president's office, a spate of political assassinations that seems to be beheading the ruling political party's leadership, and the popularity of the Ejrcito Zapatista de Liberacion Nacional (EZLN). B-M has a lot of work to do in Mexico. In the words of reporter Jon Reed, who investigated B-M's activities in Mexico, "Burson-Marsteller and other Mexican and transnational PR firms have demonstrated their effectiveness by working behind the scenes – gauging public opinion, counseling government andcorporate leaders, shaping media coverage, and acilitating elite-to-elite communications – in short, guaranteeing that the inevitable upheavals in an authoritarian and unjust society do not interrupt business as usual".

Destroying Health Care

One of NAFTA's most nefarious consequences will be the dismantlement of Canada's government-run health care system. Since it places very strict limits on what domestic or foreign corporations can do, its more progressive features--such as compulsory licensing in order to control drug costs-- will eventually be challenged as barriers to trade. Once the Canadian system is gutted by NAFTA's notor iously secretive and undemocratic dispute resolution mechanisms, Canadian citizens will have no choice but to turn to the 'free market' for medical services and insurance.

However, American and Canadian pharmaceutical and insurance companies that want to crack open the Canadian market are frustrated by the fact that Canadians are very happy with their health care system. Worse yet, more and more Americans, especially in Vermont, are now calling for the introduction of single-payer health insurance in their country--a step in the direction of a Canadian-style system. This presents a grave problem for neoliberal demagogues, since it exposes the basic conflict between capitalism and democracy.

Enter Burson-Marsteller's health care unit, whose staff includes "a medical doctor/physician; former FDA (Food and Drug Administration) commissioner; former hospital administrator; former pharmaceutical communications executives; former non-profit communications chiefs; grassroots specialists, and former reporters" according to the senior editor of O'Dwyer's newsletter, whichmonitors the PR business.

B-M has plenty of experience in matters of public health. On behalf of client Philip Morris, B-M created the National Smokers' Alliance (NSA) to fight against smoking restrictions. According to John Stauber and Sheldon Rampton, the NSA "is a state-of-the-art campaign that uses full-page newspaper ads, direct telemarketing, paid canvassers, (toll free) numbers and newsletters to bring thousands of smokers into its ranks each week. By 1995 NSA claimed a membership of 3 million smokers".

The NSA is headed by B-M vice-president Thomas Humber and its members include B-M executives Pierre Salinger and Kennetz Rietz, as well as Peter Kelly, senior partner of B-M subsidiary Black, Manafort, Stone & Kelly (see sidebar). In addition to this, B-M was hired by the A.H. Robbins company when its Dalkon Shield IUD contraceptive injured thousands of women who used it, and it is now currently promoting the 'virtues' of Eli Lilly's anti-depressant wonder drug Prozac.

The winners of the health care debate in the US were beyond any doubt the pharmeceutical transnational corporations (eleven of which are B-M clients) and the major insurance companies (which include B-M clients Met Life, Equitable Life, Aetna, State Farm and Mutal of Omaha). Now both businesses are vertically integrating themselves into superconglomerates known as health maintenance organizations (HMO's). According to Joyce Nelson, "During 1994 both the pharmaceutical industry and the private insurance industry consolidated into even bigger players on the health care scene, with B-M playing a major role in arranging the mergers among its clients". HMO's are not required to cover all illnesses or people, but can instead discriminate against elderly citizens and/or people with health problems in order to reduce operating costs.

What can we do?

The awesome power of the 'manufactured consent' of the mass media, created in no small part by PR firms like Burson-Marsteller, can be discouraging to many politically aware citizens. However, despair is what the PR business sells: despair from even the smallest possibility of positive social change from below. If we are to believe that organized citizens cannot effectively challenge corporate and government power, then the PR flacks will have truly triumphed. But, as Rampton and Stauber say in their book, " The fact that corporations and governments feel compelled to spend billions of dollars every year manipulating the public is a perverse tribute to human nature and our own moral values ".

The author is a Puerto Rican journalist living in Vermont, where he is a guest lecturer and research associate at Goddard College's Institute for Social Ecology.
Recommended reading: PR Watch. This quarterly newsletter, edited by John Stauber, provides a progressive and critical perspective on the public relations business. 3318 Gregory Street, Madison, Wisconsin 53711, USA.

Sources:

  1. Center for Public Integrity. Private Parties: Political Party Leadership in Washington's Mercenary Culture. 1992.
  2. Center for Public Integrity. The Trading Game: Inside Lobbying for the North American Free Trade Agreement. 1993.
  3. Deal, Carl. The Greenpeace Guide to Anti-Environmental Front Groups. Odonian Press, 1993.
  4. Dillon, John. "Burson-Marsteller: Poisoning the Grassroots" Covert Action Quarterly: Spring 1993.
  5. Greenpeace. The Greenpeace Book of Greenwash. 1992.
  6. Khor Kok Peng, Martin. The Uruguay Round and Third World Sovereignty. Third World Network. 1990.
  7. Nelson, Joyce. "The Time of the Hangman" Adbusters: Winter 1989-1990.
  8. Nelson, Joyce. "Burson-Marsteller, Pax Trilateral and the Brundtland Gang vs. The Environment" Covert Action Quarterly: Spring 1993.
  9. Nelson, Joyce. "Dr. Rockefeller Will See You Now" Z Magazine: May 1995.
  10. Nelson, Joyce. "NAFTA's Nuclear Agenda" Z Magazine: June 1995.
  11. Parry, Robert. Fooling America: How Washington Insiders Twist the Truth and Manufacture the Conventional Wisdom. Morrow, 1992.
  12. Rampton, Sheldon & Stauber, John. Toxic Sludge is Good for You: Lies, Damn Lies and the Public Relations Industry. Common Courage Press, 1995.
  13. Reed, Jon. "Interview with the Vampire: PR Helps the PRI Drain Mexico Dry" PR Watch: fourth quarter, 1994.

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Date: 13 Nov 1999 14:52:57 -0600
From: Robert Mann robt_m@talk.co.nz
From: Mark Gold mgold@tiac.net

Mark Gold
Aspartame Toxicity Information Center
12 East Side Dr., #2-18
Concord, NH 03301

603-225-2110    mgold@tiac.net
http://www.HolisticMed.com/aspartame

the "Online Corporate Spy Network" web page

Mark Gold wrote:
I thought that some of you might be interested in having a look at what I call the "Online Corporate Spy Network" web page:

http://www.ewatch.com

They are contracted to spy on tens of thousands of groups on the Internet so that some companies can attempt to attack both honest, independent information and rumor on these groups.

They used to watch my web page and posts (and probably still do) and a recent, on-going spam (incessant ping) of my web page from their area reminded me of their activities. I have to say that it is much more fun to play with keywords when posting thanks to the Online Corporate Spy Network. :-)

Another thing that I wanted to mention is the increase in email spam with clearly inaccurate information (sometimes called "urban legends" -- although the urban legends web sites are sometimes inaccurate). After reading a report that expressed concern for the believability of information on the Internet (i.e., concern that people were actually believing the independent information!), I suspect that *some* of this "urban legend" spam may be an attempt by PR firms to gradually reduce the trust of independent information on the Internet. These PR firms and chemical/biotech companies certainly have quite a bit to gain from this type of campaign. And given that they would contract to spy on tens of thousands of groups on the Internet, I would not put it past them to anonymously conduct such a campaign.

Feel free to distribute this email widely.

Best Wishes,

Mark Gold


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Date: 13 Nov 1999 20:25:27 -0600
From: Judy_Kew@greenbuilder.com (Judy Kew)
From: "Biotech Activists" biotech_activists@iatp.org

A new list server on Standards

I am going to start a small, closed list server on the issue of Standards, looking at the whole range of issues related to standard setting, inspection, verification, certification, globalization, harmonization, and the links between local,state, and federal law and standard setting. If you are interested, let me know.

I don't expect that I will post very much on this until after you know what.

Mark Ritchie, President
Institute for Agriculture and Trade Policy
2105 First Ave. South
Minneapolis, Minnesota 55404 USA
612-870-3400 (phone)    612-870-4846 (fax)
mritchie@iatp.org    http://www.iatp.org

-------------------------------------------------
Green Homes For Sale: http://www.greenbuilder.com/realestate
Green Building Pros: http://www.greenbuilder.com/directory
Calendar: http://www.greenbuilder.com/calendar
Bookstore: http://www.greenbuilder.com/bookstore


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Date: 14 Nov 1999 05:38:22 -0600
From: RBBAX@aol.com

About Monsanto

© 1999, St. Louis Post-Dispatch. Distributed by Knight Ridder/Tribune Business News.

Monsanto has three major segments after spinning off its chemical division. Monsanto's chemical business became Solutia, a stand-alone company in 1998. Enviro-Chem is Monsanto's engineering business.

  1. AGRICULTURE

  2. PHARMACEUTICALS

  3. NUTRITION AND CONSUMER

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Date: 14 Nov 1999 14:42:15 -0600
From: mail@icsenglish.com

Monsanto faces its many options

By Robert Steyer, Of The St. Louis Post-Dispatch

It's becoming clear that Robert B. Shapiro's vision exceeded his company's coffers and Wall Street's patience.

Investors, analysts and some Monsanto Co. insiders believe Monsanto's chairman soon will make a deal that will dramatically alter his goal of engineering a life sciences company. A deal could come within a few weeks or a few months.

Shapiro didn't invent the term "life sciences company," which describes the melding of nutrition, biotechnology, crop protection and medicine under one corporate roof.

But he has been the most passionate proponent, even as more well-heeled competitors have vacillated.

Now, it appears Shapiro may wave the white flag with some transaction – merger, sale, spin-off, joint venture – that will cut back on Monsanto's ambition.

"I think the old concept of life sciences is on life support," said William Fiala, an analyst for the Edward Jones brokerage.

Fiala and other analysts, who have followed Monsanto's transformation from a traditional chemical company, said Shapiro is being pressured by some events beyond his control.

He is being roughed up by the quick-score behavior of big- time money managers who control about 80 percent of Monsanto's stock. "Once that pressure starts, you can't afford to have the institutional investors dumping their stock," said a former Monsanto executive who requested anonymity.

"Many people look at life sciences as providing some sort of short-term dividend, but that's never been the case," said Sano Shimoda, president of BioScience Securities, in Orinda, Calif., an agribusiness research firm. "Life sciences is a long-term strategy."

Several bigger companies – such as DuPont and Novartis – have the money to carry on the life sciences concept if Monsanto gets carved up. But these companies still view life sciences as a collection of components rather than as a unified business that weaves together all of the units.

"Monsanto is the professor; the other companies are the students," Shimoda said. "Monsanto is the leader in creating this vision, and it put its money where its mouth was."

But Monsanto gagged on its heavy spending – about $8 billion worth of transactions between 1996 and 1998, including one deal still pending.

Shapiro's desire to buy seed companies stretched Monsanto's balance sheet and weakened its stock price, despite big revenue infusions from the herbicide Roundup and, this year, from the arthritis drug Celebrex.

Seeking to finance his vision, Shapiro talked to many drug and chemical companies before embarking on an ill-fated merger plan with American Home Products Corp. last year.

Monsanto is talking to many companies now, and Shapiro has often said that everybody in this business talks to everybody else.

"This time, it's for real," said a former Monsanto executive. After the American Home merger collapsed 13 months ago, Monsanto moved quickly to create a financial recovery strategy. It issued stock and debt and started divesting assets. Monsanto's credit ratings barely budged downward, but investors continued to snipe.

Meanwhile, Shapiro failed to build the enhanced-nutrition component of his life sciences dream. While Monsanto's president, he was the point man for the $1 billion purchase in late 1995 of Kelco, a maker of food ingredients.

Kelco never blossomed. Monsanto almost shut down its alginate business - food ingredients derived from brown seaweed - before selling it at a bargain price. The bigger part of Kelco, the biogums ingredient business, is for sale. So is the rest of the consumer products division, including the artificial sweetener NutraSweet.

Monsanto's stock price has never reached the levels it enjoyed during the American Home courtship.

The stock has climbed about 20 percent in little more than a week thanks to rumors of impending deals and to a three-way slugfest among giant drug companies.

Investors are betting on a new round of drug industry consolidation, figuring Monsanto will be engulfed by it. Monsanto has been urged by some analysts to sell or spin off its drug subsidiary, G.D. Searle & Co. in the name of shareholder value.

At the same time, several Monsanto peers are pulling back on the agricultural part of their life sciences strategy.

Novartis, DuPont and American Home are firing employees in their crop protection divisions. American Home, Novartis and AstraZeneca are hinting at sales or spinoffs of their crop units.

As competitors struggle, Monsanto's farm products division is outperforming them during a worldwide agriculture slump.

Given the complications in the food and farm arenas, analysts can't agree on what Monsanto will do next. What deal makes economic sense, supports research and rewards shareholders?

Merging with DuPont or Novartis would trigger anti-trust alarms; the deals would put a lot of seeds in few hands. Spinning off Searle would fetch a nice price, but would leave Monsanto vulnerable as long as the farm economy remains depressed and biotechnology is controversial.

Merging with a drug company would not solve the farm or biotech issues. Pfizer, for example, likes Searle but has no interest in agriculture. Resurrecting an American Home-type deal is always possible. The merged company could then spin off the agriculture units as a separate entity - but it might not yield much of a price.

There are plenty of reasons - unrelated to drugs or crops - why analysts expect Monsanto to make a big deal soon. Accounting rules are expected to be revised by the end of 2000, repealing or scaling back existing rules that offer tax advantages for mergers.

Analysts also believe that Shapiro, 61, doesn't have a successor to forcefully promote his vision. They say Monsanto's president Hendrik Verfaillie is a competent manager with strong agriculture expertise, but they say he is not the ringmaster for the multi-faceted life sciences show.

"An independent Monsanto is gone because the former vision as we knew it is gone," said a long-time Monsanto watcher on Wall Street. "There's not enough glue to hold life sciences together under one company. You can expect more alliances in the future for pieces of life sciences."

Still, some people cling to the notion of Monsanto as an independent company. "Sure, it could happen but there would be tremendous risk," said Shimoda, the agribusiness analyst. The risk is a depressed stock price and prospects of shareholder suits. The risk will remain as long as protests against biotech crops create uncertainty among consumers, farmers and investors.

Monsanto has been staggered by the virulent reaction of European consumers, politicians and, ultimately, food company customers against genetically engineered foods.

Overseas protests, foreign food labeling laws and Europeans' vows to avoid bioengineered foods have worked their way back to the United States. American farmers, who have embraced biotech crops, now wonder how much cotton, soybeans, canola and corn they should buy for the next planting season.

Even if biotech crops help them cut costs of using chemicals to kill weeds and insects, they don't know if they can find adequate markets for these crops. Despite efforts by trade groups and companies to alleviate these fears, experts say many farmers will wait longer than usual to make seed-buying decisions this year.

Right now, Shapiro's vision is in the hands of the highest bidder. Analysts expect Monsanto could fetch a price of at best $55 a share, or about $10 a share better than Friday's closing price.

Many people who question some of Monsanto's tactics and fret about its stock price still find time to praise Shapiro's vision.

"The manipulation of food and the work with genetics just may be way too early (for investors to embrace)," said Alex Hittle, who follows the life sciences industry for A.G. Edwards & Sons. "Twenty years down the road, we might take the pieces of Monsanto and put them back together again."


Top PreviousNextFront Page

Date: 14 Nov 1999 14:42:15 -0600
From: mail@icsenglish.com

Monsanto Options: Pros and Cons

By Robert Steyer, Of The St. Louis Post-Dispatch

Sections:
Stay Independent and Maintain Its Strategy
Merge With A Drug/chemical Giant
Sell The Whole Company
Make A Deal With A Big Biotech Company
Spin Off Searle As An Independent Company
Partner With Another Company

Stay Independent and Maintain Its Strategy

PRO: Monsanto keeps intact its life sciences vision and retains its impact on the community.

CON: The company risks stock price beating, analyst opposition and shareholder lawsuits. Option provides no protection against chronic crop biotech protests and doesn't accelerate debt-cutting efforts.

Merge With A Drug/chemical Giant

PRO: Monsanto relieves its debt burden, and provides marketing money and muscle. The company maintains research money.

CON: Control over research goals is cut, unless deal is true merger of equals. Monsanto's corporate identity weakens. Culture issues emerge, and the move could spark layoffs.

Sell The Whole Company

PRO: The benefits are similar to a merger: Monsanto relieves its debt burden, and provides marketing money and muscle. The company maintains research money.

CON: Severe job cuts result, especially if deal is hostile. Control over research ends; Monsanto's corporate identity is erased. Community/philanthropy efforts are hurt. Tax consequences are more severe.

Make A Deal With A Big Biotech Company

PRO: A joint venture/merger with Genentech, Biogen, etc. keeps research aim on farm and pharmacy efforts, adds marketing clout to biotech firms and offers better tax benefits than a sale.

CON: High-leveraged, high research-spending companies are combined. The move doesn't offer quick debt relief, doesn't solve crop biotech albatross and raises questions of whose vision prevails.

Spin Off Searle As An Independent Company

PRO: Gives a quick cash infusion to cut debt, offers a home for the drug unit, provides better tax deal than selling Searle, and calms investors and analysts – at least for a while.

CON: The move kills vision of life sciences, chokes off big profit-producer in Celebrex arthritis drug, leaves farm/biotech unit isolated and puts Monsanto in play for takeover.

Partner With Another Company

PRO: Move could relieve some financial pressure. Partners could combine marketing forces, whether the deal is with Monsanto or just Searle. The move offers a better tax deal than outright sale.

CON: A joint venture requires a clear understanding of who's in charge. This option's track record is mixed in life sciences. Corporate culture and layoff issues could emerge.


Top PreviousFront Page

Date: 14 Nov 1999 20:25:55 -0600
From: Mark Gold mgold@tiac.net

Monsanto Ad: Life Sciences On Life Support

Now, it appears Shapiro may wave the white flag with some transaction – merger, sale, spin-off, joint venture – that will cut back on Monsanto's ambition.

In order to help Monsanto find a buyer, I put together an ad on the Ethical Investing Web Page:

http://www.ethicalinvesting.com/monsanto/help

With any luck, companies like Novartis, Dupont and Pfizer will see the ad and make the appropriate decision!

Mark    mgold@tiac.net