Profits drop for leading German chemical firm - C&EN Global

Apr 1, 1991 - Uncharacteristically, Germany's three largest chemical companies—Hoechst, BASF, and Bayer—have just reported their 1990 financial re...
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News of the Week tion of the cost through an expanded program of Spacelab missions and of free-flyer experiments/' Life sciences research unique to the space station would not begin until the year 2000, when a permanently manned capability with a four-member crew is to be achieved. And, the board stresses, the redesigned station does not provide adequate facilities for space biology and medicine research. NASA and the NSC respond that there are national motivations for building the space station besides scientific research. But NASA expects in time to meet the research requirements. Vice President Dan Quayle, chairman of the interagency NSC, stresses his and President Bush's strong commitment to the station. It is "an integral part of a balanced plan" for space exploration, he notes. And "the most compelling reason" for building it, he says, is its necessity for "reaffirmation of the leadership in space of the United States of America, the world's only superpower." Richard Seltzer

Profits drop for leading German chemical firms Uncharacteristically, Germany's three largest chemical companies— Hoechst, BASF, and Bayer—have just reported their 1990 financial results within the space of a week. One by one, it would have been unhappy reading. But in concentrated form, it confirms that 1990 was a bruising year for the European chemical industry, compared with the bumper year of 1989. The major problem was the weakness of the U.S. dollar, affecting translation of results back to the headquarters' books. Hoechst, first to report, says its total worldwide pretax profits for the year were off 23% from 1989 to $2.14 billion, with most of the declines in chemicals, colors, and fibers. Sales were down 2.3% to $29.9 billion. Volume of sales, however, was up more than 3%, but a slight decrease in selling prices and the unfavorable exchange rates hit the results. At 6

April 1, 1991 C&EN

1989 exchange rates, Hoechst says, sales of its foreign subsidiaries would have been $1.87 billion higher. At BASF, a particularly steep drop in fourth-quarter results—with pretax profits declining nearly 65%— brought worldwide pretax profits for the year to $1.83 billion, down 37% from 1989. Sales dropped 2.1% to $31.1 billion. BASF attributes the decline to the recession in North America and slackening growth in Western Europe, as well as price increases for raw materials stemming from the Persian Gulf crisis. In plastics and polymers, for example, there was a time lag before price increases were possible, and even then prices remained below expectations. Only raw materials and energy operations increased sales over 1989, up 21%. And geographically, only Europe showed a sales increase, and that was 2%. Sluggish conditions in the chemical market worldwide also hit Bayer—especially in the fourth quarter, when pretax profits were $2.27 billion, down 18% from 1989's fourth quarter. Worldwide sales for the year dropped 3.8% to $27.7 billion. Bayer notes that a demand increase of more than 2% could not offset adverse currency developments, which cut the value of sales about 6%, and price erosion. Company officials add that the first three months of 1991 show no sign of an early end to the chemical industry downturn. Patricia Layman

Wider access sought to Alzheimer drug tacrine The Food & Drug Administration has suggested that Alzheimer's disease patients be given greater access to the experimental drug tacrine, or Cognex, a promising treatment for a life-threatening disease that causes progressive loss of memory and reasoning. Last month, an FDA advisory panel recommended against approving the drug for marketing until more studies are c o n d u c t e d (C&EN, March 25, page 12). There is now no treatment for

Alzheimer's, which afflicts about 4 million Americans. Under FDA's "expanded access" or "fast-track" proposal, medical centers a n d / o r private physicians would distribute tacrine to patients who cannot take part in traditional clinical studies. The physicians would monitor their patients and send data to the drug's maker, Warner-Lambert. Expanded access, first used for experimental AIDS drugs, could help gather more quickly the additional safety and efficacy data sought by the advisory panel. Limited data presented by the company showed that the drug slightly improved patients' memories, but in some cases it was found to cause reversible liver damage. Warner-Lambert, a division of Parke-Davis Pharmaceutical Co., has not yet said if it will adopt FDA's proposal. Under expanded access, the company would either have to sell the drug at cost or give it away. Company spokesman Peter Wolf says that "there have been no substantive discussions between Warner-Lambert and FDA" about expanded access. "We don't know at this point exactly what this means." Steven H. Ferris, acting chairman of the FDA advisory panel, says in general he is "in favor of further testing of the drug provided that testing is done in a scientific manner." He would not favor expanded trials "without placebo controls." Ferris is director of the Alzheimer's Research Center at New York University Medical Center. Should Warner-Lambert agree to wider access, "it will be a constructive and positive step between FDA and the company," says Edward F. Truschke, president of the Alzheimer's Association. "The association for some time has been advocating ways to expand drug trials, and rapid acquisition and interpretation of data without compromising scientific principles or the interest of patients and family members." However, the whole issue of expanded access could become moot should the agency overturn the advisory panel's recommendation and clear the drug for marketing. But FDA has not taken such action very often. Lois Ember