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Friday, June 5, 1998 Published at 13:41 GMT 14:41 UK

Business: The Economy

Swiss companies depend on genetic engineering

Swiss companies depend on genetically engineered drugs

The Swiss pharmaceutical industry, one of the most important sectors of the country's economy, is dominated by two global companies - Novartis and Hoffman La Roche. Both are heavily dependent on biotechnology and genetic engineering.

Hoffman La Roche, which specialises in drugs and diagnostics, owns a majority stake in a leading US biotechnology firm, Genentech, based in Palo Alto, California, and supplies venture capital to smaller biotech start-up firms through its Roche Bioscience subsidiary.

The company has recently launched two genetically engineered drugs in the US and Europe: Zenapax, which prevents rejection of kidney transplants, and MabThera, which helps treat Hodgkin's lymphoma, a kind of cancer.

Roche has also become the world leader in diagnostics, paying $11bn to acquire the Corange group and its German subsidiary Boehringer Mannheim. Many of their products are also a result of genetic engineering.

Roche had sales of $12,8bn in 1997 and employed 51,600 people world-wide.

[ image: Genetically engineered corn is causing controversy]
Genetically engineered corn is causing controversy
Even larger is Novartis, a $27bn company formed by the merger of Ciba-Geigy and Sandoz. Novartis ranks number 3 in the world in prescription drugs (after Merck and Glaxo), which make up 40% of its business. It is also a leader in agribusiness, nutrition (including Gerber baby foods), and opthalmics. It had total sales of $21.3bn last year with 87,000 employees.

Novartis is particularly vulnerable to concern over genetic engineering because of its agribusiness division, the world's largest. It makes a genetically engineered corn, for example, which is resistant to the European corn borer, a larvae which can destroy up to 20% of the corn crop.

The company also uses transgenic (genetically modified) animals for testing the effectiveness of drugs, which it says reduces the need for laboratory animals.

But although the companies are headquartered in Switzerland, they are very international, with research and production bases throughout Europe, North America and Japan. So any restrictions within Switzerland may just lead the companies to transfer more of their operations out of the country.

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