Heroin and Contergan

Crisis Management at Bayer and Grünenthal

Research Paper (postgraduate), 2007

17 Pages, Grade: 1,3


Table of Contents

1 Introduction

2 Crisis Management at pharmaceutical companies Bay

3 Bayer and the Heroin Crisis
3.1 Brief history of heroin, the new wonder drug
3.2 Advertising and Marketing of Heroin
3.3 Banning Heroin from the Market
3.4 Bayer’s Response to the Crisis

4 Chemie Grünenthal and the Thalidomide Crisis
4.1 Brief History of Grünenthal’s thalidomide
4.2 Research, development, testing and marketing of thalidomide
4.3 The thalidomide tragedy
4.4 Chemie Grunenthal’s actions after the tragedy
4.5 How victims were treated

5 Conclusion

6 References

1 Introduction

In the modern medicine the use of pharmaceutical products for treatment of wide spectrum of diseases is indispensable and of common practice. Hence, the responsibility of the pharmaceutical companies to guarantee the safety of their drugs for human consumption is enormous. Unfortunately, there are cases from the history proving that due to improper testing and human negligence drugs caused more harm than good. Even in the psent day, these tragedies are worth an examination in order to remember and learn from past mistakes and to pvent their recurrence.

Many people believe that street drugs are “an entirely different class than pscription drugs, and they believe that pharmaceutical companies would never manufacture or sell street drugs”.[1] Actually the well-known pharmaceutical giant, Bayer AG, is responsible for the most addictive and feared drug nowadays – heroin.

Exactly 50 years ago, on 1. October 1957, another big pharmaceutical producer, Grünenthal, introduced the substance thalidomide. It was perscribed mainly as a sedative and for treatment of morning sickness during pgnancy, before it was discovered that the drug caused severe birth defects.

In this assignment I will investigate the consequences caused by both drugs, as well the role of the producing company in the tragedy. By providing a brief history of the development of heroin and thalidomide, as well as a detailed research of the testing and marketing strategies, I am interested in the crisis management measures that Bayer AG and Chemie Grünenthal applied to handle the catastrophes. Since heroin and Contergan were distributed all over the world, their negative effects caused harm globally. In the conclusion of the assignment, I will give a short analysis of the corporation’s efforts to pvent further damage and to reverse existing problems, bearing in mind the social responsibilities of the pharmaceutical sector.

2 Crisis Management at pharmaceutical companies Bay

In the first place it is necessary to give a definition for a crisis. The following one is provided by the Institute for Crisis Management[2] (ICM):

“…a significant business disruption that stimulates extensive news media coverage. The resulting public scrutiny will affect the organization’s normal operations and also could have a political, legal, financial and governmental impact on its business.”

The reasons for a crisis could be due to external factors, e.g. natural disasters, war, terrorism and are applicable to any industry. On the other hand, errors in the medicine development, improper testing, insufficient research about the side effects, are internal to the pharmaceutical industry. A crisis in the pharmaceutical sector could cause not only regulatory and legal problems, loss of resources, operational control or licences but might be extremely dangerous and could lead to serious damages to the population’s health.[3]

Developing and marketing a medicine has always been a very profitable business for many companies. Still, the pharmaceutical producers should bear in mind the social responsibility that they have towards the humanity. In the next chapters, I will analyse if the measures that Bayer AG and Grünenthal took after the crisis that they caused were appropriate and effective.

3 Bayer and the Heroin Crisis

3.1 Brief history of heroin, the new wonder drug

In the 1890es Bayer AG was one of the leading research-intensive European dyes manufacturers. Its chemists routinely tested all new chemicals for medicinal effects.[4] Just before the turn of the century, in 1897, one of the company’s young chemists, Felix Hoffmann, synthesized “diacetylmorphine” by boiling morphine over a stove. The mixture of morphine and acetic acid had been already discovered in 1874 by C.R. Wright at St. Mary’s Hospital Medical School in London, however, Heinrich Dreser, the head of Bayer’s pharmacological laboratory at that time, was the one who recognized the huge commercial potential of its compounds. The new medicine was called “heroin” because in field studies people using the medicine felt “heroic”[5]. Under its trade name, Bayer sold “diacetylmorphine” as a cough suppssant, especially effective for children and also as a cure for morphine and codeine addiction. A favourable coincidence that led to the mass production of the new drug was the thousands of soldiers from the American Civil War who were addicted to morphine.[6]

3.2 Advertising and Marketing of Heroin

After minimal trials – when the lab animals, on which heroin was tested, survived, Bayer launched its new drug into society. In November 1898, Bayer psented the drug to the Congress of German Naturalists and Physicians, claiming that “it was 10 times more effective as a cough medicine than codeine, but had only a tenth of its toxic effects. It was also more effective than morphine as a painkiller. It was safe. It’s not hypnotic and there’s no danger of acquiring a habit.”[7]

The mass production of “diacetylmorphine” started in 1898. Heroin was sold over the counter at pharmacies as non-addictive morphine substitute and cough medicine for children. The medical community responded very enthusiastically and began promoting heroin since the leading causes of death at that time were tuberculosis, pneumonia and bronchitis. Soon the drug became a cure for almost any illness, “from asthma to multiple sclerosis”[8]. Nevertheless, the success of the drug was more due to “Bayer’s sheer marketing brutality”[9] than to its curing qualities. Free samples were sent to different countries, including China, without having been ordered and hospitals and physicians were provided with plenty of booklets and information. Bayer started a huge advertising campaign in 1900, publishing leaflets in 12 languages and exporting heroin to 23 countries.

Since Bayer was not able to patent the substance, soon other pharmaceutical manufacturers started to produce and sell “diacetylmorphine”.[10] By 1902, heroin was accounting for five per cent of the pharmaceutical market’s global turnover. Bayer was making millions in profit because of its trademark, and also due to the fact that the drug was highly addictive. The company marketed heroin as a cure for morphine addiction before it was discovered that it was three to four times more potent than morphine itself. The danger of the addictive “wonder drug” remained hidden and neglected for years.

By 1902, many articles about the addictive effects of heroin have appeared in the medical literature. Doctors from both Europe and America independently were reporting on cases of heroin addiction, though they remained a minority. No one paid attention to these alarming first signs and in 1906 Bayer started a new advertising campaign selling heroin now as a remedy against depssion, asthma and stomach cancer.


[1] Adams, Mike (2007): The secret history of Big Pharma's role in creating and marketing heroin, LSD, meth, Ecstasy and speed:

[2] The Instutute for Crisis Management is a research-based crisis communications consulting firm with clients in the U.S. and abroad. It develops communications in order to minimize the crisis’s consequences of a crisis event so the client's business can be returned to normal, profitable operations in the shortest possible time.

[3] See Vora, Hemant (2006) „Crisis Management in Pharmaceutical Outsourcing”

[4] ACS publications: The pharmaceutical century. 10 decades of drug discovery

[5] Some authors link the name of the drug to the German word for heroic, “heroisch”

[6] Farell, Audrey (1997): Addicted to profit – Capitalism and drugs

[7] Askwith, Richard (1998): How aspirin turned hero

[8] Gale Group (2000): The Stuff That Makes A Hero - history of heroin usage linked to Bayer

[9] Ibid.

[10] Evers, Marco (2000): Viel Spaß mit Heroin! In: Der Spiegel 26/2000

Excerpt out of 17 pages


Heroin and Contergan
Crisis Management at Bayer and Grünenthal
University of Applied Sciences Osnabrück
International Markets
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ISBN (eBook)
ISBN (Book)
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532 KB
Heroin, Contergan, International, Markets
Quote paper
Margarita Russeva (Author), 2007, Heroin and Contergan, Munich, GRIN Verlag, https://www.grin.com/document/117487


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