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Business Concentrates

September 27, 2004 | A version of this story appeared in Volume 82, Issue 39

BASF, Bayer boost crop science

Two of Germany's chemicals giants have given a big vote of confidence to biotechnology within the agricultural sector. Hans W. Reiners, president of BASF's agricultural products division, told a recent media briefing in Limburgerhof, Germany, that "2004 as a whole is going to be a successful year" for the unit. The division is aiming to show an operating profit of 25% by either next year or 2006; it already raised the figure to 21% last year, up from 16% in 2002. Reiners said the division will be aided by its research pipeline, which holds a growth potential of $1.8 billion per year. Among its recent restructuring moves, the division is reducing the number of active ingredients it sells from 300 in 2001 to fewer than 100; it currently has about 170 actives. The company has already opted to close its ag operations in Mount Olive, N.J. And it is weighing how to restructure its sites elsewhere, including in Brazil. Separately, Bayer's bioscience group inaugurated a $20 million plant biotechnology innovation center in Gent, Belgium. The center marks an important milestone in Bayer's plant biotechnology strategy, said Friedrich Berschauer, chairman of Bayer CropScience. By the end of this year, the bioscience group will have invested about $100 million in R&D to support products in its pipeline.


Invista to add China spandex

In Invista's first major expansion since Koch Industries bought the former DuPont textile fibers and feedstock business at the end of April, Invista has announced plans to build a $100 million spandex fiber plant in Foshan, Guangdong province, China. To be completed by mid-2006, the plant is designed so that initial capacity of 24 million lb per year can easily be doubled, Invista says. The firm says it will hire more than 100 workers to run the operation.


Clariant adding metallocene wax

Clariant has begun construction in Hoechst, Germany, on what it describes as the world's first plant devoted to waxes based on metallocene catalysis. The plant is scheduled to open in early 2006 with "several thousand" metric tons per year of capacity. Clariant says its investment is in the "two-digit" millions of dollars. Uses for such waxes include dispersants in the plastics, automobile, and coatings industries.


Kevlar fights wind damage

Kevlar helps storm room occupants ride out fierce weather.
Kevlar helps storm room occupants ride out fierce weather.

Residents of hurricane-prone areas can build an extra measure of protection into their home by outfitting shelters with p-aramid-based bullet-resistant fabric. According to DuPont, Kevlar p-aramid sheathing built inside reinforced wall panels can stop and deflect windborne debris. During independent lab tests, DuPont says its specially constructed "StormRoom" deflected a 15-lb two-by-four that was shot out of a cannon at 100 mph.

Solutia weathers hurricane

Solutia says its plants close to Hurricane Ivan's Sept. 16 landfall in Gulf Shores, Ala., suffered no significant damage. The company's nylon complex in Pensacola, Fla., maintained power throughout the storm, while operations at its Foley, Ala., facility were nearly back to normal by the beginning of last week. However, a plant belonging to Solutia's CP Films unit in Martinsville, Va., was hit by a tornado from Ivan's outer bands on Sept 17. An administration and manufacturing building suffered "significant structural damage." Other chemical companies along the Gulf Coast report no significant damage from the hurricane.


Asian firms up LCD materials

South Korea's LG MMA has started construction of a 40,000-metric-ton-per-year plant that will produce optical-grade methyl methacrylate, used in liquid-crystal display (LCD) components such as light panels. LG MMA is 50%-owned by LG Chem, 25% by Sumitomo Chemical, and 25% by Nippon Shokubai. LG affiliate LG-Philips is a leading manufacturer of LCDs. Separately, Hitachi Chemical will expand by 40% its capacity for surface protective film for LCD optical sheets. The product is a polypropylene-based adhesive that Hitachi makes at a plant in Ibaraki prefecture, Japan.

BASF and DSM invest in Sciona

Sciona, a nutritional genomics company, has received an infusion of cash from four venture-capital firms, including two that belong to major chemical companies. Burrill & Co. and Prelude Trust led the round of financing, but BASF Venture Capital and DSM Venturing also participated in providing $4.1 million to Sciona, which develops genetic tests that help people match nutrition and lifestyle choices to their individual genetic profiles.


Kyowa has new amino acid route

Kyowa Hakko Kogyo has developed a new process to produce amino acid dimers, or dipeptides. The company will make use of the process by 2006 to begin commercial production of alanyl glutamine, a dipeptide made of l-alanine and l-glutamine. Alanyl glutamine is an easily absorbed source of l-glutamine. Kyowa Hakko says the key to the process is a new enzyme that directly connects the two amino acids. l-Glutamine is often used as an antiulcer agent, and it promotes cell immunity as well as cell growth in wounds. However, the body does not easily absorb pure l-glutamine.


Pfizer, Medarex strike a deal

Pfizer will make a payment of $80 million to Medarex and purchase $30 million of the company's stock as part of a deal involving discovery and development of up to 50 antibody drugs over 10 years. The companies also cross-licensed patents in their anti-CTLA-4 antibody programs. CTLA-4, or cytotoxic T-lymphocyte antigen 4, is a glycoprotein and immune system regulator implicated in autoimmune diseases such as rheumatoid arthritis and multiple sclerosis. Medarex will be using its antibody production technology to create lead candidates for Pfizer's disease targets.


Flurry of biodefense deals

A number of companies have signed biodefense deals with U.S. government agencies. Coley Pharmaceutical got a $17 million contract with the National Institute of Allergy & Infectious Diseases to develop immune-activating drugs for defense against bioterror agents. ID Biomedical received an $8 million award from NIH to develop a nasally delivered plague vaccine. Integrated BioPharma subsidiary NuCycle Therapy has an R&D agreement with the U.S. Navy to carry out Phase I clinical trials on a plant-derived oral anthrax vaccine. And the U.S. Army is to evaluate the recombinant human fibrinogen developed by Pharming Group for suitability as a tissue sealant and for other therapeutic uses.


Two agreements for Novartis

Novartis and Xenon Pharmaceuticals are linking to develop obesity drugs based on Xenon's target, stearoyl-CoA desaturase-1 (SCD-1), an enzyme in fatty acid metabolism and insulin action. Vancouver-based Xenon says it will receive precommercial payments totaling up to $157 million as well as royalties on products that result from the venture. In an earlier stage collaboration, Novartis is teaming up with Cellzome of Heidelberg, Germany, to identify new targets in various disease areas.


Output still climbing

U.S. chemical production increased again in August, according to seasonally adjusted data from the Federal Reserve Board. The production index for all chemicals increased 0.5% from July and 6.3% from August of last year to 112.1 (1997 = 100). Meanwhile, the index for basic chemicals, although unchanged from July at 100.8, was still up 6.1% from August 2003. The government's estimate of plant capacity utilization was 76.5% in August, up from 76.1% in July and 73.1% in the comparable 2003 month.


Rhodia cuts pharma jobs

Rhodia Pharma Solutions is reducing the workforce at its Dudley, U.K., facility by about 25%, eliminating as many as 85 jobs. Nick Green, president of the Rhodia unit, says the move is part of an ongoing consolidation of the company's pharmaceutical business, which includes moving the company's Boston and Malvern, Pa., operations earlier this year to a new facility leased from DuPont in Deepwater, N.J. The company is in talks with unions at Dudley and says it hopes to complete its restructuring by the end of the year.


SF-Chem gets a new owner

Syngenta and Clariant are selling their stakes in chemical intermediates producer SF-Chem to the private-equity company Capvis for a total of $64 million. Syngenta has 75% of SF-Chem, and Clariant has the remaining 25%. SF-Chem is headquartered in Pratteln, Switzerland, and has about 360 employees. "As an independent company, SF-Chem will be better able to develop its business and secure its long-term success," says Christoph Mäder, Syngenta's director for Switzerland.

Honeywell and Grace end suit

W.R. Grace has settled litigation with Honeywell concerning contamination of a 32-acre Grace-owned property in Jersey City, N.J. Under the agreement, which is subject to bankruptcy court approval, Grace will transfer the site to Honeywell, which will fully indemnify Grace and pay Grace $62.5 million. The property, acquired by a Grace subsidiary in 1981, was contaminated with approximately 1.5 million tons of chromium waste from a plant owned by a Honeywell predecessor company that had closed in 1954. So Grace sued Honeywell for damages and for an injunction ordering Honeywell to remove the chromium waste.


  • MG Technologies has suspended the sale of its plastics business, Dynamit Nobel Kunststoff, to U.S. auto supplier Flex-N-Gate. MG says it intends to take legal action against Flex-N-Gate for failure "to honor its contractual obligations" despite two extensions to the completion deadline. 

  • Human Genome Sciences has named Argeris N. (Jerry) Karabelas as its new chairman. He replaces William A. Haseltine, who is retiring. Karabelas was previously chairman of the Novartis BioVenture Fund.

  • Air Liquide has reached an agreement to sell former Messer Griesheim carbon dioxide assets in Germany to the German industrial gases firm Tyczka. The business involved has sales of more than $12 million annually.

  • Dow Chemical has opened a 60,000-metric-ton-per-year plant to produce its Versify plastomers and elastomers in Tarragona, Spain. The company says the ethylene-propylene copolymers, which were launched in February, are meant to improve properties for makers of rigid packaging and thermoplastic elastomers and polyolefins.

  • Degussa has agreed to plead guilty and pay a $1.5 million fine for participating in an international scheme to fix the price between August 1997 and March 1998 of organic peroxides, such as tert-butyl perbenzoate, which are used to make rubber and plastics.

  • BASF has formed a partnership with Taiwan-based SiPix Technology to develop colored "electronic paper." BASF will develop the dyes needed to produce multicolored displays for use as electronic books, newspapers, magazines, and advertising signs. It will also acquire an equity stake in SiPix.


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