Lawmakers raise drug safety concerns in Smithfield buyout
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WASHINGTON, July 25, 2013- House lawmakers raised drug safety concerns about Chinese meat processing company Shuanghui International's acquisition of Smithfield Foods, the largest U.S. pork producer, in a letter to Smithfield's CEO on Thursday.
Six Republican members of the House Energy and Commerce Committee asked Smithfield CEO Larry Pope to provide information regarding the production of heparin, a blood thinner used by 12 million people in the United States each year. The committee members noted that Smithfield is a major supplier of crude heparin used to manufacture the drug for surgery and dialysis patients in the United States.
The Chinese company's acquisition raises concerns of contamination, which has been linked to adulteration during the manufacturing of the drug in China, they wrote.
“The committee's investigation indicates that the U.S. heparin supply is stressed, and could well be in shortage,” the members wrote. “China's heparin market is experiencing its own pressures, and Smithfield Foods under Shuanghui control may be pressured to export its crude heparin product to China instead of supplying U.S. companies.”
The letter noted that Shuanghui is linked to several incidents of clenbuterol poisoning during 1998-2007, even after the Chinese Agriculture Department banned the use of clenbuterol in 1997.
“The fact that the business practices under Shuanghui International control led to such contamination heightens our concerns of how Smithfield Foods will be able to maintain the safety of its heparin products should distribution of crude heparin be maintained in the U.S.” they wrote.
The Committee on Foreign Investment in the United States (CFIUS), an interagency committee that must review foreign buyouts, recently extended its process. Smithfield announced this week that the CFIUS will conduct a second-phase, 45-day review of the proposed acquisition. At the end of the 30-day review, CFIUS took the option to extend the process for an additional 45 days.
Earlier this month, the Senate Agriculture Committee held a hearing to discuss the $7.1 billion takeover. Committee Chairwoman Debbie Stabenow, D-Mich., voiced her concerns about the merger and what it may mean for U.S. food companies and food safety.
“Smithfield might be the first acquisition of a major food and agricultural company, but I doubt it will be the last,” Stabenow said. “That is why we must take a long-term view of what is happening. We need to be having this conversation and evaluating what is in the best interests of American families and our American economy because of the importance of our food supply, security, and safety.”
Pope said food safety will be maintained to U.S. standards despite the buyout.
"There should be no noticeable impact on how we do business in America and around the world, except that we will do more of it," Pope told the senators. "This is a wonderful opportunity for the U.S. to do what it does best, which is to produce agricultural products and ship those around the world."
In their letter Thursday, House Energy and Commerce Committee leaders requested a response regarding their concerns about heparin by Aug. 7. The letter was signed by Reps. Fred Upton (R-MI), Joe Barton (R-TX), Marsha Blackburn (R-TN), Tim Murphy (R-PA), Joe Pitts (R-PA), and Michael C. Burgess, M.D. (R-TX).
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