Bayer: Need Some Heroin for Your Cough?

Think of the biggest cities in the world:
places like Tokyo, New York, or Shanghai, where millions of people are clump up together. In the past, whenever a large population lived
in a small area, you’d get horrible disease outbreaks. Spanish flu, cholera, the Black Death; all
those nasty diseases would keep the population small and divided. Such problems are a thing of the past now
thanks to modern medicine, and so in today’s video we’ll take a look
at one of the big names in the pharmaceutical industry: Bayer. Now Bayer is a very old company and it’s
German. It was established in 1863 by man named Friedrich
Bayer, who made a living as a dye salesman. Now at that point in history the chemical
industry was still very young: only a few decades ago the Industrial Revolution
had swept across Europe and created the booming textile industry. The thing about making clothes, though, is
that you need to dye them, and to do that, well, you need dyes. Now, natural dyes were often very rare and
expensive, and textile makers wanted a cheap replacement to go along with their mass production. The answer to that problem was synthetic dyes,
and that’s what our friend Friedrich Bayer was making. Synthetic dyes had been around for less than
ten years when he opened his factory. They were discovered in 1856 by a man called
William Perkin. He was a college student at the Royal College
of Chemistry in London, and at the time he was trying to synthesize quinine, a medication
for treating malaria. No matter how hard he tried, he couldn’t
get the reaction right, but in one of his failed experiments he noticed a purple solution
in one of his flasks. This failure turned out to be a blessing,
as he quickly discovered that this solution could permanently turn clothes purple. Pretty soon he had a factory set up to mass-produce
this purple dye, and that made him very rich. Back in Germany, Friedrich Bayer and friends
were essentially doing the same thing: mass producing dyes and turning a huge profit. Business was good in these early days of little
competition. Bayer’s company grew from 3 employees in
1863 to over 300 in 1881. The synthetic dye industry could not remain
young forever though, and eventually new competitors started driving prices down. Bayer response was to establish their own
research department. This was a huge gamble at the time. Science and medicine as we know them today
didn’t exist in the end of the 19th century: people didn’t know about acidity, radiation,
electrons, even the nuclear model of the atom. Hell, they had only discovered that washing
your hands was hygienic less than 50 years prior. Despite the sorry state of science though,
Bayer’s research department managed to make a huge breakthrough when they discovered Aspirin
in 1897. The active ingredient of Aspirin had been
discovered more than a century earlier, but ingesting it alone would cause you a nasty
stomach ache, so it generally wasn’t used. What the Bayer scientists managed to do was
to make Aspirin less disruptive and more effective. That made it an instant seller, and its kickstarted
Bayer’s global expansion. Another big hit they sold was heroin: yes,
that heroin. It too had been discovered several decades
before, but Bayer managed to commercialize it as a, and I quote, “non-addictive cough
suppressant.” That’s right, they sold heroin as cough
medicine. It was a bit of an overkill, but you have
to admit it was pretty effective. It probably won’t come as a huge surprise
that heroin ended up being extremely popular around the world. Combined with Aspirin, Bayer’s international
sales skyrocketed. By 1913, they had subsidiaries in the UK,
US, France, and Russia, and over 80% of their revenue was coming from exports. They eventually stopped selling heroin, for
obvious reasons, but that didn’t stop their massive international expansion. Everything seems to be going great, and then
this happens: Archduke Franz Ferdinand gets shot, Austria-Hungary
invades Serbia, everyone contracts a bad case of nationalism, and you get World War 1. In an instant, 80% of Bayer’s revenue was
gone. Their international subsidiaries were expropriated,
and their assets ended up being sold off to competitors. Back at home, they became integrated in Germany’s
war economy. That meant producing war materials for the
Kaiser’s military: things like explosives and chemical weapons. Things went bad for the Central Powers pretty
fast, and Bayer didn’t fare any better. The November Revolution came and went, but
the Germany economy was still pretty much ruined. The early 1920s saw one of the most spectacular
cases of hyperinflation in modern history: the German mark’s value diminished from
48 marks per dollar at the end of WW1, to over 4.2 trillion marks per dollar in 1923. Bayer was in deep financial trouble by that
point, and so in 1925 they agreed to a massive merger with their German competitors. The resulting conglomerate was called IG Farben,
which is short for, oh God help me: Interessen-Gemeinschaft Farbenindustrie Aktiengesellschaft. Just rolls off the tongue doesn’t it. It was a bold, yet effective move by the Germans,
and in a couple of years France and the UK would also consolidate their chemical industries. With IG Farben, however, things start to get
a little bit controversial. Don’t get me wrong, they made immense contributions
to all areas of chemistry. Many of their researchers were awarded Nobel
Prizes for their discoveries, but by the end of the 1920s a particular someone was already
poking his head around the German political scene:
After Hitler became the Fuhrer of Germany in 1934 he ordered the large-scale rearmament
of the German military. This turned out to be a very lucrative business
opportunity for IG Farben, and they took it. By the time Hitler became trigger happy and
decided to invade Poland, IG Farben was one of Nazi Germany’s biggest government contractors. This is where things start to get ugly. Many concentration camps were set up to be
strategically close to IG Farben’ factories. They relied heavily on slave labor, especially
towards the latter part of the war, and they even went as far as to build a synthetic rubber
plant next to Auschwitz. They also produced and held the patent for
Zyklon B, the infamous insecticide that was used to gas people in extermination camps
during the Holocaust. They were involved in some truly messed up
stuff, and I wouldn’t blame you if you need some eye bleach, so here’s an image of cute
little puppies to make you feel better. So, what happened after the war? Well, things in the East were simple:
Stalin came, saw, and nationalized, and that was the end of IG Farben’s Eastern assets. Things in the West, however, were a bit more
complicated. As you know, many former Nazis were tried
for war crimes at the Nuremberg trials. IG Farben’s directors were also put on trial,
but they managed to get off lightly compared to their friends from the military. Of the 24 defendants who were indicted, only
13 were found guilty, and their sentences barely ranged from 1.5 to 8 years. The Allies had initially decided to destroy
IG Farben because of how morally corrupt it was, but as usual, the interests of major
corporations got in the way of justice. John Rockefeller’s Standard Oil, for example,
had close ties to IG Farben, and the two firms had engaged in numerous cartel agreements. I’ll refrain from getting into conspiracy
theories, but it’s a fact that IG Farben continued their operations well after the
fall of the Third Reich. They were finally broken up into their constituent
companies in 1952, which lead to Bayer’s reestablishment as an independent company. Things weren’t looking good for the new
Bayer: this was the second time in a row they had lost all of their foreign assets. This time though they managed to buy up several
of their smaller competitors that were also spun off from IG Farben. In the end, Bayer’s strategy was pretty
much the same: they would heavily invest in research and
development, and they would constantly release new products to the market;
not just medicine, but also pesticides and petrochemicals. Over the next five decades, Bayer’s research
division would make numerous advances in the fields of chemistry and medicine, far more
than you’d like to know. They ended up spinning off their petrochemical
division in 2004, so now they just make pesticides and medicine. Funnily enough, they coexisted with IG Farben
up until 2012. That’s right, it took German authorities
sixty years to settle all the lawsuits from former factory slaves. What they’ll do in the future will probably
be the same as what they’re doing now: making the world a better place through innovations
in medicine. That’s about it for Bayer’s story. I hope you enjoyed this fun and occasionally
horrific video. Please leave your thoughts and opinion in
the comments below, I’d love to hear them, and don’t forget to mention which company
you’d like me to feature next. If you’d like to support this channel please
like and subscribe, and as always, stay smart.

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