ALIEN PROPERTY: Uncle Sam Sells

One of the biggest prizes seized by the Office of Alien Property during the war was the German-owned Schering Corp. of New Jersey. Under Francis Cabell Brown, Government-appointed president and former corporation lawyer, chemical and drug sales steadily climbed from $2.8 million in 1942 to last year's $15.4 million. Earnings per share rose from 43¢ to $3.12. Schering was the second company to put cortisone on the market, has marketed new sulfa and penicillin products, holds a prominent place in the antihistamine field, has introduced several important new drugs, including "Dormison" (for insomnia), and "Prantal" (for peptic ulcers).

Two months ago, prodded by Congress, GAP put Schering up for sale. Last week it was sold to the highest bidder, brokerage firms Merrill Lynch, Pierce, Fenner & Beane, Kidder, Peabody & Co., and Drexel & Co., who had joined with more than 70 other investment houses to make the bid. Price: $29,131,960. The high price surprised Wall Street, since Schering stock has a book value of about $26 a share, against the syndicate's bid of about $66. This week the syndicate is splitting the 440,000 shares four to one, will put them in the market at $17.50 each, or al most three times the actual book value of the split shares.

The price seemed high, especially as Schering no longer holds any exclusive patents, chief protection for the income of a drug company. Two months ago, on the same day the Government announced Schering's sale, it released the 215 formulas held by Schering prior to 1942 to any U.S. citizen who wants to use them. All patents developed since 1942 would be leased out for a "reasonable royalty." But the syndicate isn't worried. It plans to keep the present research-minded management, is counting on Schering's chemists for more new formulas.