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Wednesday, Sep 20 1995
Paper Gains
Does Newt Gingrich hold the key to the joint operating agreement (JOA) that locks the Chronicle and Examiner together? Gingrich wants to reduce the capital gains tax from its current 28 percent rate to 20 percent or even lower; who knows, Clinton might find himself amenable to an election-year tax cut to stimulate the economy and thereby boost his campaign. Such a lowered tax would trigger a wave of transactions by cash-hungry hounds like the de Young heirs, owners of the privately held Chronicle Publishing Co. The family's hunger for cash -- or at least liquidity -- may have been only partially sated by the sale of the Chronicle Co.'s Western Communications cable division for stock in publicly held cable giant TCI.

If Newt's bill passes and is applied to all '95 deals, the Chronicle owners would be crazy not to seek Justice Department permission to break the JOA as soon as they can and sell the paper to the Examiner's mother ship, the Hearst Corp. Chronicle Publishing's owners want to sit back and count their money, while Hearst has reinvigorated its once moribund newspaper division and revels in its monopoly status in San Antonio and Houston. No doubt, Hearst would like such a position here and could afford to pay for it. As the JOA clock clicks down to its 2005 expiration date, the Chronicle's value declines in relation to the Examiner's because it has neither the resources nor the will to battle the Ex on an open playing field in the next century. If Gingrich fails to move his bill, or applies its provision to '96 (and later) deals only, the Chronicle family will probably sit it out until the tax code suits them.

Pressure Point
Genentech, the biotech pharmaceutical company that for the past year has been denying gravely ill women the use of an experimental breast cancer drug, is apparently experiencing symptoms of remorse.

The South San Francisco company, which is entering the final stages in the development of a promising anti-tumor agent called HER-2/neu monoclonal antibody, has told Judith Fried, 31, that they will give her the drug on a "compassionate use" basis if two physicians declare it necessary, and the Food and Drug Administration approves. The news marks a major turnaround: Two women with breast cancer died in the past year while Genentech steadfastly maintained that the drug was too scarce and expensive to dispense on a case-by-case basis. Fried and her sister similarly struggled for months to win access to the genetically engineered substance -- only to be told this summer that they'd have to wait until next year to find out if Judith could obtain it.

But pressure from breast cancer activists, from the Frieds, from Judith's doctor, and from SF Weekly stories has apparently made the company soften, says Elise Fried. "If everything goes well," she says, "we might be able to get the drug this month."

Bar Stroll
In the movie Elephant Walk, a pachyderm stampede obliterates a Ceylon tea plantation -- sparing only Elizabeth Taylor its humongous if slow-paced rage. At the bar Elephant Walk, on the corner of Castro and 18th Street, the end, if it comes, will be somewhat less dramatic. People who work there say the bar's set to close at the end of the month, which will mean saying goodbye to those comfortable banquette seats that put your eyes at hip level with the street scene outside. A bartender says the establishment can't afford the rent the building's owner wants, but that "it's not a done deal." As you know, elephants are patient. With wicked memories.

By Jack Shafer, Amy Linn, Ellen McGarrahan


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