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Agri-Business Briefs for March 8, 2006
Monsanto’s American Seeds, Inc. announces two acquisitions
ST. LOUIS, Mo. — Monsanto Company’s American Seeds, Inc. (ASI) subsidiary recently announced it made two additions to its family of regional brands. The additions are expected to further bolster ASI’s ability to help serve its farmer-customers with a technology-rich, locally-oriented business model.

In separate transactions, ASI acquired Gold Country Seed, Inc., based in Hutchinson, Minn., and Heritage Seeds, based in Rensselaer, Ind. Gold Country Seed, Inc., serves farmers in the northern Corn Belt. Heritage Seeds serves farmers in the eastern Corn Belt.

“These companies are important additions to our ASI business model and our continued support of farmers,” said Ernesto Fajardo, vice president of Monsanto’s U.S. crop production business. “ASI represents a distinct, high-touch, regional approach to the marketplace. We look forward to enabling these regional companies to bring greater germplasm and trait innovation to their local markets than ever before.”

Monsanto acquired both companies in cash transactions totaling $8.7 million. The specific terms of the individual transactions were not disclosed. Collectively, these two companies represent approximately 0.4 percent of total U.S. corn and soybean seed sales.

American Seeds, Inc., which was formed by Monsanto in 2004, serves as a holding company for regional seed companies that market primarily corn and soybeans. For more information on ASI, visit

University of California agrees to settlement from Monsanto
SAN FRANCISCO, Cailf. — In a settlement involving one of the first biotechnology patents ever applied for, Monsanto Co. has agreed to pay the University of California an upfront royalty of $100 million plus ongoing royalties that could easily double that amount, to resolve claims that the agribusiness giant infringed on the University’s DNA patent used to make a dairy cow growth hormone. The settlement was reached a day before trial.

The patent, originally sought in 1979, covers a form of recombinant DNA to produce bovine growth hormone protein now sold under the Monsanto brand name POSILAC® bovine somatotropin. The hormone increases dairy cow milk production between 10-30 percent. About 30 percent of dairy cows in America are given somatotropin and it is expected to become an increasing factor in dairy farming in developing countries.

In addition to the $100 million paid upfront, Monsanto will pay the university additional royalties of 15 cents on each dose sold to dairy producers internationally until the patent expires in 2023, with a minimum yearly payment of $5 million. That could increase the ultimate value of the settlement to in excess of $250 million, making it one of the highest patent payments to a university research institution.

In turn, Monsanto will receive an exclusive license for the patent in continued production of POSILAC.

The original discovery of the DNA process was made in 1979 by UC San Francisco researchers, but it took until 1993 for somatotropin to be approved for use by the FDA. However, the university fought with the U.S. Patent and Trademark Office for recognition until a final determination was made in the university’s favor in 2004.

This farm news was published in the March 8, 2006 issue of Farm World.