Thanks to energetic protesters who claim the company's modified crops carry a wide range of environmental and health risks, opposition to the so-called Frankenfoods reached a fever pitch in Europe this year. And lately, American consumers have shown signs of rebelling against products such as Monsanto's modified seeds, which are at the heart of the company's agribusiness. Those inklings of dissent were enough, apparently, to make up executives' minds: They would complete a merger and quickly cut the agribusiness free from the rest of the company, letting it fend for itself. That amputation, execs hope, will leave Monsanto and Pharmacia & Upjohn's pharmaceuticals division to take the market by storm unhindered by bad publicity.
Even in this gilded era of unsurpassed profit for biotech and pharmaceutical conglomerates, one company always struck analysts as something of a black sheep. The Monsanto Company, whose subsidiary Searle makes the wildly successful arthritis drug Celebrex, has been casting around for a merger partner for over a year, and now, executives say, the search is over. Monsanto will merge with Pharmacia & Upjohn, joining the ranks of other mega-merger firms like Astra-Zeneca and Rhone-Poulenc-Hoechst, to form a corporation worth about $52 billion. Why did it take so long for Monsanto to find its mate, and why was Pharmacia willing to take it on? The answers lie in Monsanto's agri-chemical division, a successful but controversial arm of the company, which is the target of a bitter alarmist campaign aimed at its genetically modified crops.