Wyeth sets aside €30m to cover civil actions threat

A US pharmaceutical giant which was fined yesterday for breaches of Irish waste management legislation has set aside €30 million to cover the potential cost of civil actions over the contamination of pig feed in the Netherlands in 2002.

Wyeth Medica Ireland was fined €40,000 in Dublin Circuit Criminal Court after pleading guilty to four breaches of waste management legislation arising from the mishandling of byproducts from its manufacturing plant in Newbridge, Co Kildare.

A waste broker, Cara Environmental Technology Ltd, was also fined €40,000 after pleading guilty to four counts of shipping waste out of the State without a certificate on dates in 2000 and 2001.

The two firms were prosecuted after waste water from the Wyeth plant was exported, recycled and processed into treacle to be fed to pigs. The waste was found to contain a contraceptive, medroxyprogresterone acetate (MPA), which caused infertility in pigs.

The resulting food scare affected 11 EU states, forced the closure of half of all Dutch pig firms and badly hit Irish pork exports in 2002.

The fines imposed by Judge Patricia Ryan of the Dublin Circuit Criminal Court are light compared with the maximum of €12.7 million allowed under environmental legislation.

The judge accepted that Wyeth had no intention of committing a wrongdoing and did not act unlawfully with the intention of making a profit.

She also accepted that the company had no knowledge of the criminal conduct of Bioland, a Belgian waste processor which accepted the waste water from Ireland. Bioland has since gone bankrupt and its owners have been given suspended sentences in the Belgian courts for their role in the affair.

A Dutch company, Schuurmans Van Ginneken, originally sought compensation for €131 million from Wyeth for the contamination and disposal of up to 26,000 tons of molasses contaminated with MPA and for compensation for its customers.

It has since put its losses at €24 million, plus legal fees. Wyeth has provided bank guarantees for €30 million as security for the amounts claimed.

The Dutch meat and livestock board is also suing Wyeth for €8 million for losses incurred by its farmers.

Pfizer, which acquired Wyeth last year, said in a statement that systems had improved at the Newbridge factory since the problem arose in 2002. It said the facility had made significant improvements to its management systems and operated to high environmental standards under the regulation of the Environmental Protection Agency (EPA).

The statement added: “We note the State has acknowledged that Wyeth had no intention to cause damage or harm, did not benefit financially from Cara’s actions and believed at all times that the waste would be properly treated, and the offence could not reasonably have been foreseen.”

The company also said it was confident about its position in any civil proceedings, particularly given the State’s acknowledgement in the Irish court case that Wyeth did not intend to cause harm and believed the waste would be properly treated.

Cara, which is facing claims in the Irish and Dutch courts, has denied any liability and said it will fight the cases.

The EPA declined to comment on the fines.

Wyeth has agreed to pay €70,000 as a contribution to the prosecution costs while Cara will pay €50,000 costs.