Genentech Growth Hormone Probe Widened

All in all, it has been a difficult week for Genentech. In addition to the failure of Pulmozyme in COPD, the firm has announced the resignation of chief executive Kirk Raab for alleged ethical and leadership lapses (see page 3), and has also confirmed that the US government is widening its investigation into the firm's marketing of its human growth hormone product Protropin. On July 11, the District Attorney's office in San Francisco subpoenaed Genentech documents relating to the marketing of the drug.

Genentech is already under investigation by the District Attorney's office in Minneapolis. In this case, one of Genentech's senior sales executives, Edmon Jennings, is under indictment for allegedly bribing a doctor to prescribe Protropin to children (Marketletter January 23, 1995). A trial date has been set for August 1.

It is still too early to comment on whether shareholders should be concerned about the widening of the investigation, according to Genentech. The company has always maintained that its marketing efforts for Protropin, and indeed all of its drugs, are aggressive but nevertheless are conducted in an ethical manner.