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plan because it takes away his clients' right to sue Dow Chemical even though the Nevada Supreme Court affirmed Dow Chemical's negligence in failing to publish its knowledge of the potentially hazardous biological effects of liquid sil icone. That court let stand a 1995 jury award of $4.1 million to Charlotte Mahlum for autoimmune illnesses allegedly suffered as a result of her ruptured breast implants. Dow Corning counsel Houser counters, "A few want special deals. In bankruptcy everyone is treated equal ly." White says the appeals process could take up to two years. Marc Reisch
Battling on: WarnerLambert sues Pfizer Warner-Lambert has asked a Delaware court to allow it to terminate comarketing agreements with Pfizer and reclaim all rights to the blockbuster cholesterollowering drug Lipitor. At stake for Pfi zer is a share in revenues estimated to exceed $3.6 billion in 1999 and nearly $6 billion by 2002. Warner-Lambert's countersuit is the latest step in an ongoing battle over cre ation of die world's largest drug produc er. Early last month, as Warner-Lambert announced a friendly $67 billion merger with American Home Products (ΑΗΡ), Pfizer stepped in with a higher offer for Warner-Lambert. When that offer was not accepted, Pfizer, seeking to stop the merger, sued Warner-Lambert and ΑΗΡ in Delaware Chancery Court, and sepa rately charged the companies with breaching the comarketing agreements. Pfizer believes that "Warner-Lam bert has engaged in a series of desper ate defensive measures designed to deny its shareholders the opportunity to consider an offer . . . that represents a premium." At recent stock prices, Pfizer's offer has been worth about 20%, or $13 billion, more than AHP's. Despite its counterclaim, Warner-Lambert stopped short of asking the court to pre vent Pfizer from taking it over. Still, Warner-Lambert believes that Pfizer's offer represents "massive and intentional breaches" of the Lipitor agreements that include standstill provi sions preventing Pfizer from making an offer to acquire Warner-Lambert. "Pfi zer cannot commit flagrant breaches of contract, as it has, and expect to contin 12
DECEMBER 6,1999 C&EN
ue to reap the fruits of this relationship," says Lodewijk J. R. de Vink, WarnerLambert chairman, president, and chief executive officer. Pfizer asserts that it hasn't violated the agreements and that the standstill provisions terminate when a third party agrees to acquire Warner-Lambert. However, Warner-Lambert says that its "merger of equals" deal with ΑΗΡ does not qualify as an acquisition. Such pacts are popular, in part, because they offer accounting and tax benefits to share holders and the companies. Pfizer gets about 45% of Lipitor sales this year, the third of the 10-year comar keting arrangement. Warner-Lambert has the option of terminating the arrange ment at either the beginning of year six or, if there is a change in control of the company, at the beginning of year four. Warner-Lambert is preparing itself so that "the marketing of Lipitor would not
suffer," should the court terminate the agreements now, de Vink says. ΑΗΡ has remained quiet as Pfizer and Warner-Lambert battle it out through letters, lawsuits, and at meet ings with shareholders, board mem bers, and analysts. However, in a brief statement and letter to Warner-Lam bert, ΑΗΡ now says it is prepared to "provide a mechanism, consistent with our existing merger agreement, for fair ly allocating to Warner-Lambert's share holders additional value created by the recovery of the marketing rights to Lipi tor." Whether this means ΑΗΡ will in crease its merger offer and enter a bid ding war with Pfizer is yet to be seen. A preliminary injunction hearing on Pfizer's suit to block the merger is sched uled to begin Jan. 24, 2000. A target date of May 15, 2000, has been set for ΑΗΡ and Warner-Lambert shareholder votes. Ann Thayer
CMA airs chemical testing plan The Chemical Manufacturers Associa tion (CMA), accepting its growing role in testing chemicals for toxicity, has put forth its recommendations for a voluntary testing scheme being developed by the Environmental Protection Agency designed to safe guard children's health. CMA presented its plan at a two-day public hearing on the Chemical Right-to-Know Children's Health Testing Challenge in Washington, D.C., last week. CMA was respond ing to an EPA preliminary testing proposal that the association believes is inef ficient (C&EN, Nov. 29, page 23). The idea for the chil- Tirey dren's health testing chal lenge arose in a speech given by Vice President Al Gore in April 1998 and has since been pursued vigorously by EPA Currently, the agency says it intends to screen about 100 priority industrial com pounds using a battery of 10 toxicology tests to determine whether the chemicals present unreasonable risks to children. Many of these compounds are produced in high volumes and so are also included in EPA's high-production-volume chemi cals testing program. 'We are proposing that EPA take an approach that integrates two things," ex
plains Sandra Tirey, coleader of CMA's public health team. "First, use a tiered ap proach with both screening and low-level testing, and second, also consider poten tial exposures in a tiered way." Tirey notes that these would not | be separate processes, but Ϊ would proceed in unison, I integrating both toxicity £ tests and exposure moni| toring in each tier. "This would end up with both the informa tion needed to manage risk and the data on ex posures that would let regulators put the infor mation into its proper context," Tirey says. Under EPA's prelimi nary proposal, all toxicity testing in the higher tier would be triggered if there were a single positive result from the first tests. Also, no exposure information would be included after the initial screening. 'We have prob lems with a single positive triggering all the tests in the next tier," Tirey says. Following the meeting, EPA indicated that it would pay more attention to expo sure information, but many issues sur rounding the program remained unre solved, such as route of exposure and the use of developmental neurotoxicity tests. Another meeting is scheduled for January. David Hanson
