Strained Peace: Gerber Baby Food, Grilled by Greenpeace

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Dec 5, 2012 (4 years and 8 months ago)

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Wall Street Journal

Page A1

July 30, 1999

"Strained Peace: Gerber Baby Food, Grilled by Greenpeace, Plans Swift Overhaul
--

Gene
-
Modified
Corn and Soy Will Go, Although Firm Feels Sure They Are Safe
--

Heinz Takes Action, Too”

By LUCETTE LAGNADO Staff
Reporter of THE WALL STREET JOURNAL

The letter scrolling out of a fax machine at the Gerber baby
-
food company in Michigan May 28 was just
one of many arriving that day and didn't even name the person it was meant for, but it sure got
attention. Within days
, it had found its way to Gerber's parent company in Switzerland, Novartis AG, and
come to the attention of its chief executive officer. There, executives soon were taking steps to overhaul
a decades
-
old product that generates $1 billion in annual sales.

T
he letter came from Charles Margulis, a New York man who addressed it simply "to the CEO" because
he didn't know the chief executive's name. The return address was his small apartment on the Upper
West Side of Manhattan. But the letter also carried the log
o of his employer, Greenpeace, the activist
European environmental group.

"As you know, there is growing concern around the world about genetically engineered food," it said.
Greenpeace is "concerned that the release of genetically engineered organisms int
o the environment
and food supply may have irreversible consequences." Does Gerber use genetically engineered products
in its baby food, the letter wanted to know. If so, which products? And "what steps have you taken [if
any] to ensure you are not using"
genetically modified ingredients?

Mr. Margulis asked for a reply within five business days.

Europe's Ways

These are tense times for U.S. food and agricultural industries: European opposition to importing corn
and soybeans grown from genetically modified se
eds, or beef from hormone
-
fed cattle, has led to an
ugly trade dispute and taken a big bite out of U.S. agricultural exports. American consumers, however,
have so far greeted the hubbub roiling Europe with a big yawn. The U.S. Food and Drug Administration
says genetically modified foods "are as safe as other foods in the grocery store."

But the concern at Novartis is that all this could turn on a dime


that because of Greenpeace's efforts,
European worries about the safety of genetically modified crops cou
ld leap across the Atlantic and
damage Gerber, the largest baby
-
food producer in the U.S. Novartis officials had been hoping Gerber
was immune to the anti
-
bioengineered
-
food passions that have whipped through Europe in recent
years. The letter from Mr. Mar
gulis made them stop hoping and start planning.

The company firmly believes that the bioengineered foods are safe to consume. Indeed, another unit of
Novartis sells genetically altered crop seeds with which to produce such foods. But this summer,
Novartis
is moving rapidly to make preemptive changes at Gerber: At some cost and considerable
inconvenience, Gerber is dropping some of its existing corn and soybean suppliers in favor of ones that
can produce crops that aren't genetically altered. That is to say,

it will no longer buy corn grown from
seeds modified so that the plants are resistant to corn borers, or soybeans from seeds altered so the
crop can tolerate being sprayed with a potent weedkiller.

It is an issue that is suddenly confronting all the U.S.
baby
-
food producers. H.J. Heinz Co., the maker of
the Earth's Best line, says it has just decided that this line and all other baby food it produces will be
manufactured without using genetically modified crops. A private manufacturer in Poway, Calif., cal
led
Healthy Times Natural Foods has switched from Canola oil, which sometimes is genetically altered, to
safflower oil after facing questions from Greenpeace. As for BeechNut Nutrition Corp., it says it probably
doesn't have much of a problem with this bec
ause it uses no soy and little corn.

Gerber, going even further than what Greenpeace demands, plans to use corn flour and soy flour that
are "organic"
--

that is, the crops not only aren't genetically altered, but they also were grown without
the use of an
y insecticides or herbicides. Then, if the technicalities can be worked out, it plans to change
ingredient labels on certain baby
-
food boxes and jars to include the word "organic." The company will
still use some corn that isn't organic, but it will be cor
n that hasn't been genetically altered. Gerber,
however, is cautious about offering any guarantees that its products can be made totally free of such
ingredients.

"I want our mothers to be comfortable," says Al Piergallini, president and chief executive of
ficer of
Novartis's U.S. consumer health operation, which oversees Gerber. "I have got to listen to my
customers. So, if there is an issue, or even an inkling of an issue, I am going to make amends. We have to
act pre
-
emptively."

The label issue is trickie
r, first because of the difficulty of avoiding trace amounts of genetically modified
foods in the U.S., and second because the FDA has strict rules about what a food producer can claim
about its product on its label. Yet one of Greenpeace's central demands

is that Gerber and other baby
-
food makers label all their products to say whether they contain genetically modified ingredients. To
sort out this ticklish issue, Gerber is assembling an advisory panel of outside experts from several U.S.
environmental and

consumer groups.

The whole undertaking is a dicey matter, because by shunning ingredients it has used for years, Gerber
risks confusing or frightening its core customers, as well as appearing to endorse food fears that the
company itself proclaims to be i
nvalid. And who is to say more Greenpeace demands won't follow if this
one is met? In Europe, the organization has recently started demanding that even dog food be free of
genetically modified organisms. But Gerber officials want to get out in front of the

competition on the
issue.

And they can't take a chance, says Gerber's vice president for research, Jan Relford. "The parents trust
us; if they don't trust us, we are out of business," he says. So he supports the supplier changes even
though he says the sc
ientific evidence so far supporting the safety of genetically altered crops is "2,000
-
to
-
nothing."

Although the FDA says it "has no information of any health effects with foods derived from genetic
engineering," Greenpeace's point is that their long
-
term e
ffects
--

on health and the environment
--

simply aren't known.

The organization cites various scientists and institutions, including the British Medical Association, which
has publicly expressed concern about bioengineered foods. "Some of the effects may
be subtle," says
Martha Herbert, a pediatric neurologist in Boston who supports Greenpeace's campaign. "The problem
with studying this is that the effects may be long
-
term."

In the U.S., Greenpeace is by no means the potent force it is in Europe.

There, ar
mies of staffers and volunteers can target large corporations in a flash, hooking up with
numerous well
-
connected political allies to form what some regard as an environmental fear brigade.

In the U.S., Greenpeace has only several dozen staffers and is typ
ically on the fringe of political
discourse; its reputation was grist for an episode of the TV comedy "Seinfeld" a few years ago.
Greenpeace made little headway in a previous effort to call attention to genetically modified crops,
when activists went to Io
wa in 1996, donned biohazard suits and spray
-
painted pink a field of soybeans.

Infant Formula

Mr. Margulis has had better luck, by shrewdly homing in on the potentially emotional issue of baby
-
food
safety, as his Greenpeace colleagues did earlier in Europe
. "I am not going to be disingenuous," says Mr.
Margulis, who recently moved his base of operations to Baltimore. Baby food "pressed so many buttons.
We picked it because people are going to be concerned about what they are feeding their kids." Figuring
th
e time is ripe to import Europe's concerns to the U.S., he says, "I have no qualms in saying, yes, I hope
people do get very upset."

In Europe, Greenpeace has had considerable success on this front. Last summer, it confronted
executives of Novartis's Swiss

baby
-
food line, Galactina, asking them point blank if it contained any
genetically modified ingredients. Within 24 hours, Novartis blinked, saying it would yank certain
products off Swiss grocery
-
store shelves. In recent months, it has made Greenpeace a f
irm promise that
new Galactina products would be free of genetically altered ingredients.

But Galactina is tiny. It sells only three million jars of baby food a year. Gerber produces 5.5 million per
day in the U.S. and has U.S. sales of $700 million annual
ly, plus $300 million abroad.

Buoyed by this success, Greenpeace launched a similar campaign in the U.S. late last year. To run it, the
group hired Mr. Margulis, a peace
-
studies graduate of the University of California at Berkeley. Unlike
some more
-
radical

Greenpeace veterans, he has had only two arrests growing out of environmental
protests. His most flamboyant act to date: In Colombia, to protest against strawberries modified with
the gene of a flounder (for its cold tolerance), he dressed up as a berry w
ith fishy eyes.

Collecting Samples

The campaign started slowly. The owner of Savoy, a restaurant in the SoHo section of New York, hosted
a lunchtime news conference to denounce genetically modified food, attended by a group of star chefs,
some of them
French. The event was largely unnoticed, but Mr. Margulis, a former pastry chef himself,
formed a useful bond with the chefs.

Then one day this spring, Mr. Margulis went to New York
-
area supermarkets and bought $5 to $10
worth of baby foods, from Gerber, B
eech
-
Nut and Heinz's Earth's Best. Elsewhere he picked up two
kinds of liquid feeding formula for the elderly and disabled, one of them made by a different unit of
Novartis. He shipped some of the samples to Britain for testing by RHM Technology, a laborat
ory
experienced at detecting minute amounts of genetically modified material.

Within a couple of weeks, the results came back. The lab found no genetically modified ingredients in
the jars of baby food. But Gerber's dry cereal for babies contained modified

corn and soy, and the
formulas for the elderly also had bioengineered soy, Greenpeace said.

Rather than confronting companies right away, Mr. Margulis faxed letters to several U.S. baby
-
food
makers posing questions and seeking quick responses. He later ca
lled Gerber's Mr. Relford in Fremont,
Mich., where Gerber is based, and left a voice message.

Although Gerber appeared to be ignoring Mr. Margulis, it wasn't. His "to the CEO" letter was making its
way up the corporate hierarchy, ultimately sparking debate

at the highest levels of Novartis, a $21
billion corporation whose largest business is pharmaceuticals. For its CEO, Daniel Vasella, who is a
veteran observer of Greenpeace tactics in Europe as well as a physician, the letter was a sign that
Greenpeace wo
uld try to strike in his lucrative U.S. market.

It did. On June 18, Mr. Margulis disclosed the British lab report. Venerable Gerber was guilty of using
genetically engineered food in its dry baby cereal, he told reporters. The news conference took place at

another trendy New York restaurant, Avenue, whose owners had begun marketing their own brand of
organic baby food
--

at $2.95 a jar, five times Gerber's price. Some star chefs were again in attendance.

Greenpeace's report accused Gerber of using "altered

corn" in its cereal, which it said "produces a
bacterial toxin, Bacillus thuringiensis (Bt)." The report said that when "genetically altered Bt plants grow,
they produce the toxin, which is an insecticide farmers use to ward off certain pests." It also sa
id that
soybeans in Gerber baby food were grown with "a toxic weed killer."

Gerber doesn't dispute Greenpeace's essential finding about the presence of ingredients from
genetically modified crops in some of its products. But Novartis's Mr. Piergallini, a f
ormer boss of
Gerber, angrily dismisses the notion that genetically modified corn produces dangerous toxins, calling
this "ludicrous and inflammatory."

Headquarters Debate

While maintaining a cool outward stance, Novartis and Gerber soon were abuzz with de
bate. Mr.
Relford, a scientist and Midwesterner, believe customers wouldn't be swayed by Greenpeace
--

that
sound science and Gerber's reputation would prevail. At the same time, he wanted the company to be
ready to act in case circumstances suddenly chang
ed. Mr. Piergallini also doubted that European food
attitudes would catch on in the U.S., but he thought that to be safe, Gerber should quickly take pre
-
emptive action.

Dr. Vasella, the Novartis CEO
--

having been through the Galactina affair and having wi
tnessed
Greenpeace's publicity
-
grabbing tactics for years in Europe
--

pushed to find an immediate solution at
Gerber. And three weeks ago, the board of Novartis's U.S. arm agreed that Gerber should move
aggressively to deal with the problem. One key thing

on the table: possibly relabeling products to
indicate when any of them may still contain tiny amounts of genetically modified crops. Some
ingredients come from suppliers that handle both organic and

genetically modified crops, so
that minute
traces of th
e bioengineere
d stuff may show up in even the "purest" foods.

But there are questions as to wha
t Gerber's labels can say about
genetically modified ingredients
--

either their presence or their
absence. That's because the FDA doesn
't see any health risk in

these
ingredients. James Maryanski, the FDA's
biotechnology coordinator, says
that companies are free to
include optiona
l information if it is truthful
and doesn't mislead the consumer. But
"if someone wants to
say that a
product was or was not developed
by g
enetic engineering, and if that
information implies to
consumers that a
competing product ... wasn't as
safe, that would be a misleading labe
l." He adds that
the FDA hasn't
developed specific guidelines regardin
g label mentions of genetically modified
foods.

To figure out what to do, Gerber will c
onsult a pool of non
-
Greenpeace
environmentalists who are
concerned

about the long
-
term effects of
bioengineered foods, and of consumer grou
ps concerned
about food safety.

New Suppliers

In the past two weeks, m
eanwhile, Gerber has moved to rid its prod
ucts of
genetically modified corn
used in vario
us cereals and other foods. Mr.
Piergallini says it is will use mostly org
anic corn. While the
new supply
will probably cost twice as much
--

rais
ing corn without weed

killer or
insecticide is labor
intensive and tends t
o produce lower per
-
acre yields
-

--

corn is used in relatively small quanti
ties, so the
move will add only
several hundred thousand dollars a year

of expense. Once the switch is
made, the
labels will pr
obably say "organic corn" or "organic corn

flour."

The company is also switching soybean sup
pliers. Soon, its baby products
will use mostly organic soy,
even thou
gh these aren't easy to find in
large quantities. Novartis's objec
tive is to take the lead in
the
baby
-
food industry in moving away from g
enetically modified ingredients
and set the "gold standard"
for measuring
and labeling these ingredients, Mr. Piergallini says.

Will the bioengineered
-
food issue tak
e hold in the U.S. as it has in
Europe? "I can'
t bet
--

I plan,"
Gerb
er's Mr. Relford says. "If this
becom
es an issue, we will be ready."


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