Starting with the smashing of Dunkirk

Chapter 68 Filling the Last Shortcoming

By the beginning of 1915, Fritz Haber already held a very high position in the industry.

He was one of the most successful industrialists and scientists in the entire Demacian Empire.

He only took the time to meet with Lelouch today because of the Duke of Baden's request; he had no intention of bargaining with Lelouch over some details.

So after hearing Lelouch's conditions, his first reaction was very natural: "You can talk to the specific people about those details later, I'm very busy. You said you want to set up a separate company to specialize in the further application development of sulfonamides, but I don't think that's really necessary."

"Isn't your goal to use those resources to invest in this new company and take a small share of the profits? We can settle profits in a completely different way. His Highness Mark von Baden can audit the accounts; we won't tamper with these small sums."

Lelouch immediately interrupted him: "No, no, no, you misunderstand. We are not going to take away 'a small portion of the profits' of this new company. We want to have absolute control over this new company. Rather, Farben Chemicals can only hold a small portion of the equity and profits in this new company. However, we will use other methods to ensure the interests of Farben Chemicals, especially to directly ensure the interests of Farben Chemicals itself, the parent company."

Lelouch's proposal was truly outrageous, even piquing Fritz Haber's interest.

This little trick of "successfully attracting the attention of a domineering CEO" has been overused in later generations, but in Demania in 1915, given that his peers were relatively honest and rigorous, an anomaly like Lelouch could gain a considerable advantage in attracting attention.

Haber almost laughed in exasperation: "Did I hear that right? You expect to take a major stake in this new company? How much money are you prepared to invest in the new company, and how exactly will production and profits be allocated? I'll give you three minutes to make your point clear. If you can't convince me, I'll have to give the Grand Duke of Baden the truth."

Lelouch finally got his chance and brought out the core plan he had been thinking about for a long time: "In the future, the production of sulfonamides will still remain entirely within Farben Chemicals."

Moreover, the relevant departments of the Empire will ensure that even if Faben Chemical does not apply for a patent, or withdraws and reiterates it every time it is about to be published, the Empire can use its administrative power to ensure that only Faben can produce sulfonamides within its territory, and that any other company producing them is illegal.

Furthermore, the Empire will try its best to keep the subsequent application methods of sulfonamides secret for as long as possible in the field of intelligence. You should know that applying for a patent during wartime is not very helpful, because applying for a patent means disclosing technical details. Once foreigners learn it, they will not listen to the law and will just imitate it at will.

Therefore, you need the Empire's 'exclusive extra-legal authorization,' using the state apparatus to ensure that the production methods and uses of sulfonamides are kept secret as exclusive trade secrets for as long as possible. This kind of exclusive state protection is not easy; it requires many connections and favors. If your company continues to monopolize this, it will likely face repercussions in the future.

Lelouch first pointed out the limitations of legal protection during wartime to the other party, reminding them that this matter was very complex and required a lot of resources to be coordinated. He couldn't expect them to only consider economic gains, and they should soften their stance and know when to stop.

Harper was slightly tempted. He wasn't unaware of these grand pronouncements, but he was subconsciously unwilling to consider the worst-case scenario at first.

During wartime, many things must be done on a special basis, if the final product does have unique effects and is valued by the military.

Haber thought the other party was exaggerating simply because he himself didn't know how effective sulfonamides would be in the future.

"Then tell me your specific ideas," Harper finally extended the first olive branch.

Lelouch quickly pressed on, saying, "I have a plan here that I have already discussed with the Grand Duke of Baden and Crown Prince Rupprecht. However, there are still some details to be finalized regarding the final distribution ratio and funding model."

According to this plan, after Fabon Chemicals starts mass production of sulfonamides, it can calculate a base price based on the production cost of the raw materials. The newly established company is willing to purchase all of Fabon's production capacity at 300% of this base price, and Fabon Chemicals will not be allowed to sell sulfonamides to other customers. This is essentially a 200% profit margin underwriting deal, with a gross profit margin of 66.7%.

For a drug with a production cost of 1 mark, downstream companies purchase it for 3 marks. Fabbon doesn't need to worry about sales; he can just focus on production.

However, this price clearly did not satisfy Haber. Anyone who has worked in the chemical pharmaceutical industry knows that in later generations, it was common for the price of raw materials to increase by twenty or thirty times compared to the final retail price, because the cost of chemical synthesis was simply too low.

If calculated based on chemical manufacturing costs, an aspirin or ibuprofen tablet in later generations would only cost two or three cents to produce, but pharmacies would sell it for at least six or seven cents, which is more than thirty times the cost.

Of course, there are also costs associated with packaging and retail. The gross profit that is truly left for raw material drug manufacturers is generally only about 30% (for generic drugs without patent protection and in a highly competitive market).
However, regardless of the circumstances, considering all factors, a 200% premium on manufacturing costs for a proprietary raw material is something even a giant like Haber would not accept.

After some haggling, both parties finally agreed to double the price of the raw materials and sell them at 600% of the manufacturing cost, leaving the chemical plant with a 500% profit margin on the manufacturing cost, resulting in a gross profit margin of 83.3%.

The newly established company, after obtaining the raw materials, still needs to perform secondary processing. The raw materials are only in powder or liquid form and cannot be consumed directly. The traditional method is to add bone extract and compress them into tablets, or coat them with sugar.

The technology for capsules was actually developed in the United States, across the ocean, in the early 20th century, but the patent protection period had not yet expired.

However, in times of war, none of that matters, and Demacian scientists can further improve and optimize the Ugly Kingdom capsules and implement technological circumventions.

Lelouch meant this: "Based on some preliminary experiments I conducted through other channels, sulfonamides have extremely high hepatotoxicity and renal metabolic toxicity. Directly crushing them into tablets and taking them carries a small probability of liver failure and a relatively high probability of kidney failure."

Therefore, we need certain 'sustaining release technology' to add the drug to other excipients such as beeswax or other materials. The outermost capsule packaging material also needs to be optimized so that the drug is not completely digested in the stomach. It is best to release it slowly after entering the intestines. This way, we can avoid toxicity peaks and not put too much pressure on the liver and kidneys.

These are technologies that your company, Fabbon Chemicals, doesn't yet possess, but I'm generously offering you this experimental approach. I hope that I, along with the royal families of Barria and Baden, will fund the establishment of a new finished drug manufacturing plant and be responsible for developing the 'sustained-release technology.' Fabbon Chemicals can transfer some engineers and researchers to the new company to oversee the specific experimental implementation of the relevant technologies, contributing their technology as equity. Moreover, as I mentioned, subsequent clinical trials will all require the approval of the Grand Duke of Baden; you'll definitely benefit."

As Haber listened to Lelouch's detailed explanation, he realized that Lelouch also understood some chemical principles, and that his thinking was quite advanced. Haber couldn't help but think more highly of him.

This young man is indeed quite good at coordinating various parties.

While Fabon Chemicals could go to great lengths to bypass him and find their own way, perhaps even making more profit... why bother? If you find someone else, they're unprepared, have no plan in mind, and you have to plagiarize and rework—in wartime, how can you withstand such turmoil? It's better to find someone ready-made. They also have connections; if you steal their ideas and start from scratch, you'll offend them, and the deal will be off.

After some negotiations, the final solution is as follows:
The new finished drug company, with a total share capital of 400 million marks, will be responsible for purchasing raw materials at 600% of the manufacturing cost and producing sustained-release finished drugs.

Lelouch personally invested 220 million marks, taking a 55% stake. The Baden royal family and the Baria royal family each invested 40 marks, taking a 10% stake, for a total of 300 million marks, which can be considered as cash investment in the new company. If any future relationships need to be coordinated, Lelouch will be responsible for finding a way to handle it from his 55% stake.

Faben Chemicals can send family-owned professional managers to oversee daily research and development and production, but on major decisions, they must obey Lelouch and the state apparatus behind him.

Meanwhile, Fabbon Chemicals provided a group of R&D personnel and experimental equipment to immediately begin the research and development of "sustained-release drugs," and further improved the capsule technology that the Americans had developed a few years earlier. This part of the experimental equipment and technical expertise was valued at 100 million marks and invested in the new company, representing a 25% stake.

As for the factory buildings, equipment, and other hardware needed for the new company's production and operation, the aforementioned 300 million marks in cash can be used to purchase them from the parent company of Faben Chemicals. After all, these chemical groups already have a complete set of relevant equipment, and even have some left over.

Historically, sulfonamides were first put into practical use thanks to the invention of "Prontosil" in 1932, a "prodrug that would naturally release sulfonamides in the gastrointestinal tract."

Modern sustained-release capsule technology didn't emerge until 1950. Using sustained-release capsules to overcome the bottleneck of "not yet having developed Prontosil" was rather unrealistic, because modern sustained-release capsules require many polymer materials as sustained-release aggregates.

In 1915, there was no relevant technology for plastics or polymer materials.

However, Lelouch could now try to find some monkey-themed alternatives.
In any case, the first step of "sustaining release" is to prevent the drug from being completely dissolved by stomach acid in the stomach, and it is best to let it dissolve in the intestines, so making the capsule thicker is achievable.

Once inside the intestines, the capsule has dissolved completely, and we want the medication to be released slowly. At this point, we need something that can mix the powder with it and is slowly digested. If high-molecular-weight materials are unavailable, beeswax can be used with other ingredients to create a hard ointment that takes several hours to dissolve in the intestines. This allows the powder to be absorbed gradually, avoiding excessive metabolic stress on the liver and kidneys.

The specific details still need to be studied and tested gradually.

This detail is also key to Lelouch's future technological barrier—even if the war lasts a year or two, the enemy will discover that the German army used sulfonamides to treat the wounded, and then they will also manufacture sulfonamides.

But as long as they don't have a slow-release drug in mind, and the drugs are absorbed within minutes of being ingested, the enemy's wounded soldiers will most likely suffer from liver and kidney failure.

Sulfonamides themselves are easy to detect, but the various natural excipients in slow-release formulations are not so easy to detect.

Of course, using natural biological excipients, compared to pure polymeric sustained-release aggregates, also has a drawback: the shelf life of the final drug is very unstable. However, this has little impact during wartime. With so many wounded soldiers during wartime, the amount of sulfonamide produced is consumed in large quantities. There is simply no situation of storing it for several years until it spoils.

……

It took a week to handle the establishment of Faben Chemical's sulfonamide drug factory and obtain the first batch of raw materials for parallel animal experiments.

During this period, Adidas also continued to produce parachutes and paratrooper-specific weapon belts at full speed, and each batch was sent to the Aachen training base for paratroopers to use in training.

With less than a week remaining before the paratrooper offensive is ready to be completed,

Lelouch felt that there was nothing left for him to worry about in Frankfurt, so he embarked on his journey home, preparing to return to the front lines to organize the surprise attack.

On his return journey, he chose a different route than he had taken on his way there. On the way there, he went directly from Armandière to Frankfurt, but on the way back, he would stop in Antwerp.

The reason for going to Antwerp was, of course, because Vice Admiral Hipper of the Balia fleet, along with several of his battlecruisers, were in the port of Antwerp.

Lelouch always thinks three steps ahead before taking a single step in battle. Since the plan has already been laid out to "intercept and kill with combined sea and land forces," it would be inappropriate to only rely on coastal defense batteries and railway guns.

The real weapon that could cut off the enemy's "sea retreat" was the Demacian fleet!
Only a fleet can deliver the real finishing blow and the final blow, while coastal defense guns and railway guns, limited by their operational range, can only be used to weaken the enemy's naval reinforcements.

Therefore, the last stop before returning to the front lines and starting the battle was to discuss with Hipper how the army and navy could coordinate.

Two months earlier, after the Battle of Ostend, Hipper feigned weakness and retreated to Antwerp, claiming that "all four battlecruisers were severely damaged by Beatty in the artillery battle and could not be repaired in Antwerp." He even deliberately sent false telegrams to the Admiralty, asking them to find ways to expand the Antwerp shipyard and provide overhaul capabilities. In reality, this was to allow the Bretonnians to intercept and decipher these telegrams in order to mislead them.

Moreover, Hipper's acting skills were indeed superb and cooperative. Since he was going to pretend to be "seriously injured," he didn't move an inch from early November until early February, a full three months. He didn't make any attempts to fight, and even when he had a chance to gain some small advantages, he deliberately didn't take them, just to save up for a big one.

Now, after three months of feigning weakness and lying low, it's finally time to reap the rewards!

On February 8, Lelouch arrived in Antwerp, travel-worn, and went straight to Hipper's temporary command of the battlecruiser squadron.

Lieutenant General Hipper had been waiting for him for a long time. As soon as Lelouch entered, Hipper was very enthusiastic towards this friend who was much older than him and who always brought him credit.

"You finally came!"

(End of this chapter)