Sandoz

Sandoz was the huge Swiss pharmaceutical firm where Albert Hofmann worked when he discovered LSD in 1943. Sandoz had a monopoly on the Western world's production of LSD until 1953. The company wanted the drug tested for its own commercial reasons, but beyond supplying it free to researchers, it would not assume the costs of broader research. The manufacturing process moved slowly in the early years because Sandoz used real ergot, which could not be grown in large quantities. Hofmann and his coworkers published their work in a 1947 article, but no one in the United States seemed to notice until 1949 when a Viennese doctor named Otto Kauders spoke about LSD at Boston Psychopathic Hospital.Max Rinkel quickly contacted Sandoz, which arranged to ship LSD across the Atlantic.¹

CIA Panic Over Supply

Agency officials feared that Sandoz would allow large quantities of LSD to reach the Russians. On two occasions early in the Cold War, the entire CIA hierarchy went into a dither. In 1951, reports came through military channels that the Russians had obtained 50 million doses from Sandoz. Horrendous visions of what the Russians might do with such a stockpile circulated in the CIA, where officials did not find out the intelligence was false for several years. There was an even greater uproar in 1953 when reports came in that Sandoz wanted to sell 10 kilos (22 pounds) of LSD, enough for about 100 million doses, on the open market.¹

A top-level coordinating committee unanimously recommended that the Agency put up $240,000 to buy it all. Allen Dulles approved, and two CIA representatives flew to Switzerland with a black bag full of cash. The Sandoz president stated that the company had never made anything approaching 10 kilos and that its total production since the drug's discovery ten years earlier had been only 40 grams, about 1.5 ounces. The panic had been caused by a U.S. military attaché who did not know the difference between a milligram and a kilogram, throwing all calculations off by a factor of one million. Sandoz executives offered to supply the U.S. Government with 100 grams weekly and agreed to keep the CIA informed of all future production and shipping. They asked only that the arrangement be kept "in the very strictest confidence."¹