Monsanto, Pharmacia & Upjohn to Merge; Monsanto Sued Over GM Crops

STOCKHOLM--The drug company Pharmacia & Upjohn agreed to merge with life sciences company Monsanto, according to a Dec. 19 announcement. The agreement will allow the companies to focus on creating new drugs with an annual research & development budget of more than $2 billion. Additionally, there is already an impressive collection of successful drugs in the companies' stables, including treatments for glaucoma, arthritis, insomnia and colorectal cancer.

According to the agreement, Monsanto will own 51 percent of the combined company, which is yet to be named. This is Monsanto's second attempt at creating a "merger of equals." Last summer's failed attempt to merge with American Home Products Corp. sent its stock plummeting, and the failure to merge was blamed on "differing management styles."

In related news, a class action suit is being brought against Monsanto by six farmers who have accused Monsanto and other seed companies of taking genetically modified (GM) seeds to market without adequately studying their effects on the environment and human health.

This is a new tactic by biotech's opponents to curb the growth of biotechnology in the farming industry. Monsanto denounced the lawsuit, calling it another "political stunt." In a statement, Monsanto attorney Dan Snively said, "This technology has been tested for many years and it's subject to intense regulation. ... We would not put into commerce anything that we're not absolutely confident is safe and effective."