Drug Business

There was a sharp fall in stockmarket prices last week (see p. 50). But it scarcely affected the securities of those eight great U. S. manufacturing and retail drug concerns who have listed their stocks with the New York Stock and Curb exchange.* This despite the fact that their business this spring has not been so good as usual due: 1) to the absence of an influenza epidemic last winter; 2) to the smaller purchasing power of drugstore customers affected by current unemployment and business depression. This second cause is a shock to both manufacturing druggists and retailers. They had held the idea that the need for drugstore medicines was a constantly rising factor in society, independent of business conditions. The apparent reason for no falling-off last week of the eight drug corporations' stocks was that malaise accumulated during the spring would drive discontents into drugstores during the summer and autumn and that by winter seasonal colds and other maladies would make more customers.

Few drugstore customers realize that their purchases of 15-c-, 25-c- and 50-c- packets of proprietary medicines sustain a half-billion-dollar industry. The stock value of just one of the eight big ones, Drug, Inc., last week was a quarter-billion.

Boston's Louis Kroh Liggett, 55, organized Drug, Inc., two years ago. It is a holding company. Its original purchases were Sterling Products, West Virginia patent medicine makers, and Mr. Liggett's United Drug Co. With the United Drug purchase it acquired 664 Liggett drugstores in the U. S., 38 in Canada and contracts to supply 10,000 Rexall drugstores in the U. S. Besides those U. S. establishments, the United Drug purchase gave Drug, Inc. control of the 860 Boot's Drug Stores in Great Britain.

Last year Drug, Inc. bought some more stores--the 18 May Drug Stores of Pittsburgh; the eight Wolff-Wilson stores of St. Louis; and this spring the 106 Owl stores of the middle and far West. Thus there is a Drug, Inc. retail store in the business and residential districts of every fair-sized city in the U. S. and in most of those in Great Britain.

The goods sold are made largely by Drug, Inc. subsidiaries. For, after bringing United Drug and Sterling products together, Mr. Liggett quickly bought the companies which make Life Savers candies, Three-in-One oil, Ipana toothpaste, Sal Hepatica. Ingram's shaving cream, Fletcher's Castoria, Dr. W. B. Caldwell's Syrup of Pepsin & Herb Laxative Compound, Andrews Liver Salts, Mum.

Last week Drug Tycoon Liggett arranged to buy in another product, Vick's Vapo-Rub, made by Vick Chemical Co., one of the U. S. Big Eight. And in prospect is his purchase, through American Home Products Corp. (a third one of the Eight and one in which Mr. Liggett controls some capital stock), of its trademarked preparations of magnesia, digestants, cosmetics, hair tonics, floor wax, varnish remover, patent medicines, toothpaste (including Kolynos). With so many products and so many stores, Drug, Inc. is becoming what Mr. Liggett would privately like to say but publicly disclaims: practically the last as well as definitely the biggest word in U. S. cosmetics and drugs. Some one of his goods is in almost every U. S. medicine chest.

* American Home Products Corp.: Petrolager, Freezone, Kolynos, Tiz, St. Jacob's Oil, etc. Drug, Inc.: Cascarets, Bayer's Aspirin, Phillips Milk of Magnesia, Castoria, Sal Hepatica, etc., etc.

Lambert Co.: Listerine, etc.

Lehn & Fink Products Co.: Lysol, etc.

McKesson & Robbins Inc.: Drugs & pharmaceuticals.

Parke, Davis & Co.: Drugs & pharmaceuticals.

Vick Chemical Co.: Vick's Vapo-Rub.

Zonite Products Corp.: Zonite Antiseptic, etc.

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