THOMPSON’S MALTED FOOD COMPANY

And Its Blood, Nerve and Tissue Builder, “Hemo”

During the past eighteen months The Journal has received inquiries from physicians in various parts of the country asking for information regarding “Thompson’s Malted Food Company” of Waukesha, Wis., which for some time has been selling and trying to sell its stock to physicians and others. In reply The Journal called attention to the fallacy of any concern trying to induce people to purchase its stock on the ground that the Bromo-Seltzer company, the Postum Cereal company and others had been successful.

A miniature reproduction of a full-page advertise­ment of “Hemo” ap­pear­ing in a Mil­wau­kee pa­per. The original covered 341 square inches.

The earlier name for the Thompson concern was “American Malted Food Company” and originally it had its office and factory in Milwaukee. Its products are “Malted Milk,” “Malted Beef-Peptone” and “Hemo.” As long ago as 1911 the company was sending out glowing descriptions of the money that might be expected to be made by investing in the concern, which was then known as the American Malted Food Company. According to the company’s booklet it was estimated that in the United States and Canada alone $20,000,000 worth of dry malt food products were consumed annually. Further:

“On the most conserving estimate the American Malted Food Company will supply 5 per cent. of the demand or $1,000,000 of the consumption from the very outset....”

At the time this was written (1911) the company claimed that its stock had “been advanced over 100 per cent. in one year’s time” and that even then it had “found it advisable to curtail the sale of stock so as not to exceed the prescribed number of shares to any one person.” In 1914, however, the company still had its representatives in the field offering stock for sale.

In November, 1913, one physician wrote that three years previously he had purchased stock in the company and at that time (1910) was given to understand that dividends would be paid in at least a year! He has received no dividends to date. Other physicians have written that the company’s agents in attempting to sell stock have given the impression that the concern either is paying dividends or is about to pay dividends. Still other physicians say that the agents made no claim to them that the concern was paying dividends. To quote from a few of many letters together with the date of the communications:

“Alluring promises of big profits in the near future have been held out by the canvassers....” (September, 1913).

“No actual promise was made but it was ‘estimated’ that dividends would be declared ‘about the first of the year’” (November, 1913).

“After I said I wouldn’t buy any stock was told the company was already paying dividends and I was turning down a good thing.” (March, 1914).

“The agent gave me to understand that the profits of the company were enormous and that large dividends would be paid in the near future.” (March, 1914).

“Mr. —— [the agent] told me the company expected to pay dividends as soon as all the stock had been sold.” (May, 1914.)

“The agent gave me to understand that they were about to pay very generous dividends and that it was a chance to get in on the ground floor on a good thing.” (May, 1914).

The price asked for stock during the past year or more has been $1.50 a share, the par value of the stock being held at $1.00. At various times, however, the stock seems to have been purchasable from other sources at a much lower figure. A physician writing September, 1913, stated that he had just been solicited to purchase stock in the Thompson Malted Food Company at $1.50 a share, and that immediately he wrote to two firms, one in Chicago and one in Milwaukee, that sell unlisted securities, asking the price of Thompson’s Malted Food Company stock. Both brokers expressed the opinion, according to the physician, that at 90 cents a share the stock would be a “good buy,” and both offered to undertake to secure stock at that price. One of the concerns sent a circular to the physician offering the stock at 80 cents. The physician thereon canceled his order for stock which he had made at $1.50 and declared that if he bought at all he would buy from other sources.

HEMO

At the present time the product that Thompson’s Malted Food Company seems to be “pushing” is a product it calls “Hemo.” According to advertisements, Hemo is “the food that builds up weak stomachs.” Hemo, we are told, contains “the iron of spinach, the juices of prime beef, the tonic properties of selected malt in powdered form and the richest sweet milk.” Furthermore, “Hemo contains the active principle of selected barley malt ...”—​whatever the “active principle” of barley malt may be.

According to the Thompson Malted Food Company “80 per cent. of the American citizens” are “troubled with anemia” and it is for them that “Hemo has been especially prepared.” In a sentence:

“It is a well-known fact that organic iron can be obtained from animal life as well as from vegetable life, and as the digestive organs of a majority of the people are not equal to the task of supplying their bodies with a sufficient amount of organic iron to maintain a supply of a good quality blood, the lack of which results in numerous nervous ailments—​insomnia, diabetes, rheumatism, anemia, tuberculosis, etc., it has been found necessary to secure for mankind organic iron in a form that will be concentrated, palatable and most easily assimilated.”

This is a sample of the farrago of pseudo-scientific nonsense sent out by this concern in its attempt to sell “Hemo.” To continue the quotation:

“With this object in view, the laboratories of Thompson’s Malted Food Company have successfully produced and successfully tried out Hemo on the most desperate cases.”

In a letter addressed to a physician-stockholder, the statement is made: “Our Hemo-Malted Milk has never had and never will have an equal as a builder of blood, nerve and tissue ... it will build tissue, nerve and blood in less time than any other food heretofore known.”

Disregarding the question whether or not this is a stock jobbing scheme or whether the purchase of the stock is a good investment, there is another side to the matter. It must be evident that the public is not getting a square deal when physicians are financially interested in the products they prescribe for, or recommend to, the sick. Whatever the value of the Thompson products, the method of exploitation and the attempts on the part of the company to get physicians financially interested in its ventures, are to be deprecated. If laymen of a speculative turn of mind wish to invest in the stock of companies putting out “bottled energy,” “blood builders” and “nerve repairers” that is their business, but it is certainly neither conducive to the scientific practice of medicine nor to the interest of the public for physicians to be financially interested in products of this sort.​—(From The Journal A. M. A., Oct. 24, 1914.)