Cutter Laboratories was a family pharmaceutical company located in Berkeley, California, founded by Edward Ahern Cutter in 1897. Some early products of the company were anthrax vaccine, hog cholera virus and anti-hog cholera serum, and eventually a hog cholera vaccine. This vaccine was the first tissue culture vaccine, human or veterinary, ever produced. The company expanded considerably during WWII as a consequence of government contracts for blood plasma and penicillin. After Edward's death his three sons – Dr. Robert K. Cutter (president), Edward "Ted" A. Cutter, Jr. (vice-president), and Frederick A. Cutter – ran the company. In the next generation Robert's son David followed his father as president of the company. Cutter Laboratories was bought by the Bayer pharmaceutical company in 1978.
The Cutter incident 
In 1955, Cutter Laboratories was one of several companies licensed on April 12 by the United States government to produce Salk polio vaccine. In what came to be known as the Cutter Incident, some lots of the Cutter vaccine – despite having passed the required safety tests – contained live polio virus in what was supposed to be an inactivated-virus vaccine. Cutter withdrew its vaccine from the market on April 27 after vaccine-associated cases were reported. Drs. William Tripp and Karl Habel, both from NIH, were sent by Surgeon General Scheele to Berkeley to inspect Cutter's facilities, question their workers, and examine their records. After a thorough investigation nothing was found wrong with Cutter's method of production. A congressional hearing was held in June 1955 and it concluded that the problem was primarily the lack of scrutiny from the NIH Laboratory of Biologics Control (and its excessive trust in the National Foundation for Infantile Paralysis reports).
A number of civil lawsuits were filed against Cutter Laboratories in subsequent years, the first of which was Gottsdanker v. Cutter Laboratories. The jury found Cutter not negligent, but liable for breach of implied warranty & monetary awards were made to the injured parties. This set the precedent for later lawsuits. All five companies that produced the Salk vaccine in 1955 – Eli Lilly, Parke-Davis, Wyeth, Pitman-Moore, and Cutter – had difficulties in completely inactivating the polio virus, and three companies other than Cutter were sued but the cases were settled out of court.
The Cutter incident was one of the worst pharmaceutical disasters in U.S. history and caused several thousand children to be exposed to live polio virus upon vaccination. The NIH Laboratory of Biologics Control, which had certified the Cutter polio vaccine, had received advance warnings of problems: in 1954, staff member Dr. Bernice Eddy had reported to her superiors that some of the inoculated monkeys had become paralyzed (pictures were sent as well). William Sebrell, the director of NIH wouldn't hear of such a thing.
Numbers affected 
The mistake resulted in the production of 120,000 doses of polio vaccine that contained live polio virus. Of the children who received the vaccine, 40,000 developed abortive poliomyelitis (a form of the disease that does not involve the central nervous system), 56 developed paralytic poliomyelitis and of these 5 children died as a result of polio infection. The exposures led to an epidemic of polio in the families and communities of the affected children, resulting in a further 113 people paralyzed and 5 deaths.
Administrative consequences 
Despite law suits resulting from vaccine-related cases of polio, Cutter Laboratories was able to successfully expand business. Between 1955 and 1960, they purchased Ashe-Lockhart, Inc. and Haver-Glover Laboratories, manufacturers of veterinary products (Kansas City); Plastron Specialties, Pacific Plastics Company (San Francisco), and Olympic Plastics Company (Los Angeles), all dealing with plastics; Corn King Company (Cedar Rapids), an animal feed farm; and Hollister-Stier, manufacturers of allergy products with plants located in Spokane, Los Angeles, Philadelphia, and Atlanta. In 1960 Cutter Laboratories Pacific, Inc., in Japan was established. Annual sales of the Cutter company had increased from $11,482,000 in 1955 to $29,934,000 in 1962. In the early 1960s there were more than 700 products in Cutter's catalog, and in 1962 the company's assets were "80% greater than when the polio disaster had occurred." Cutter Laboratories was purchased by the German chemical and pharmaceutical company Bayer in 1978.
Other incidents 
In the 1980s, numerous companies, including Bayer's Cutter Biologic division, produced unsafe blood products to treat hemophilia. The pharmaceutical product, which was produced from blood given by donors all across the US, was contaminated with HIV at a time when HIV could not be screened out. These problems were the subject of lawsuits over the next twenty years.
A recent German documentary called "Tödlicher Ausverkauf: Wie BAYER AIDS nach Asien importierte" (Deadly Sale: How Bayer imported AIDS into Asia) researched the Koate product for hemophiliacs sold by Bayer's Cutter division under full knowledge of its HIV contamination. Cutter ex-manager Merill Boyce expressed the opinion that the company should be made responsible and pay damages. Another ex-manager John H Hink, who was also in the team responsible for marketing Koate to Asia, expressed regret in the documentary that management had required that old stock be sold despite its knowledge of HIV contamination. Lexi J Hazan and Charles A Kozak are attorneys representing victims against Bayer AG in the Koate cases. Thomas C Drees is a consultant that researched the Koate Cutter case.
- "Cutter Laboratories: 1897–1972. A Dual Trust". The Bancroft Library, University of California/Berkeley, Regional Oral History Office, Transcript 1972–1974.
- Breakthrough: The Saga of Jonas Salk, Trident Press, 1966, pp. 313–315.
- Edward Shorter, The Health Century, Doubleday, New York, 1987, pp 68–70 ISBN 0-385-24236-0
- Offit, Paul A. The Cutter Incident: How America's First Polio Vaccine Led to the Growing Vaccine Crisis, Yale University Press, 2005, pp. 100, 116–19, 133. ISBN 0-300-10864-8
- Offit PA (2005). "The Cutter incident, 50 years later". N. Engl. J. Med. 352 (14): 1411–1412. doi:10.1056/NEJMp048180. PMID 15814877.
- Nathanson N. and Langmuir AD. (1963). "The Cutter incident. poliomyelitis following formaldehyde-inactivated poliovirus vaccination in the United States during the spring of 1955. II. Relationship of poliomyelitis to Cutter vaccine". Am. J. Hyg. 78: 29–60. PMID 14043545.
- Offit, Paul A. The Cutter Incident: How America's First Polio Vaccine Led to the Growing Vaccine Crisis, Yale University Press, 2005, pp. 166–68. ISBN 0-300-10864-8
- "Waage v Cutter Biological Division of Miles Labs (11/22/96)". Retrieved 2007-12-03.