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TAKE TWO EYES OF NEWT AND CALL ME IN THE MORNING

As a young American studying medicine at Germany's Heidelberg University, Dr. Alan Shackelford became alarmed when his four-year-old daughter developed recurrent ear and sinus infections that antibiotics didn't control. After watching her nighttime fits of coughing and vomiting, Shackelford tried a 200-year-old European remedy: microscopic doses of a plant extract. The infections quickly vanished. "It was absolutely astonishing," he recalls.

That was five years ago. Now a physician practicing in Boulder, Colo., Shackelford still gives his daughter--and some of his patients--such homeopathic medicines for ailments ranging from stomach aches to poison ivy.

These remedies are based on the theory that "like cures like": Natural substances that cause certain symptoms allegedly cure those symptoms when given in tiny doses. For example, fever-inducing belladonna, the poisonous plant deadly nightshade, is used to fight fever.

For the vast majority of American doctors and researchers, homeopathic medicines are about as scientific as the witches' brew in Macbeth. In fact, eye of newt and tongue of toad could easily be homeopathic ingredients. At the French factory of a major producer, Lyon-based Boiron, tarantulas, bees, squid ink, and some 1,400 exotic plants steep in steel drums filled with alcohol for three weeks. The essences are then diluted so greatly that barely a molecule remains in the final products: tiny granules that dissolve under the tongue, or drops to mix in water.

Two centuries after a German scientist invented homeopathy, no one can explain how it works or even prove it does--beyond the power of suggestion. Yet word-of-mouth success stories like Dr. Shackelford's are prompting Americans to rediscover this old-time medicine, which was popular in 19th century America and still is in Europe.

Bill Clinton may be among the converts. Sources say a Presidential aide buys homeopathic remedies at a New York pharmacy, Hickey Chemists Ltd., to treat the First Patient's sinus problem. The pharmacy refuses comment. White House officials say the President's medications are a personal matter. Producers say U.S. consumers paid $200 million for homeopathic remedies last year, up 30% a year for the past five years. Kmart Corp. and other chains are selling the products. Harvard Medical School has offered lectures on the subject.

OFFBEAT CURES. Homeopathy's new popularity is part of growing consumer interest in alternative medicine, including acupuncture and chiropractic. Disillusioned by conventional medicine's high cost, side effects, and frequent failures, "people are clamoring for this kind of health care," says Jay Borneman, vice-president of Standard Homeopathic Co., the biggest U.S. producer. Homeopathic products require no prescription and usually cost far less than rival medicines.

Yet as the U.S. seeks new health-care solutions, it's missing a bet by not looking more deeply into homeopathy, its backers claim. The National Institutes of Health is spending a mere $30,000 on a one-year study of homeopathy's effectiveness, with results due next fall. The American Medical Assn. has no official position on homeopathy. It says it's watching the NIH study.

Manufacturers aren't waiting. They are pushing ahead with marketing efforts to capitalize on America's growing penchant for offbeat cures. Los Angeles-based Standard Homeopathic is testing TV spots in San Diego, Seattle, and Tampa. It hopes to roll out a national TV campaign in June for its top-selling product, Hyland's Calms Forte, an insomnia remedy.

German, Dutch, and French companies are moving into the U.S. market. France's Boiron, which claims to be the world's largest producer, has opened production laboratories in Philadelphia and Los Angeles. It's trying TV ads in Washington, D.C., and New York. Boiron makes homeopathy's best-selling product: Oscillococcinum, said to prevent flu if taken with the first symptoms. However, most users probably don't know the product is homeopathic. Nor do they know its ingredients--always listed in Latin: the heart and liver of wild Barbary ducks. The birds are carriers of flu virus.

Boiron is giving seminars to introduce American doctors to homeopathy, and it's spending $300,000 a year on U.S. research, including a grant to the University of California at Los Angeles medical school to figure out how its products work. "If we had a scientific basis, we'd be the size of Merck," says Christian Boiron, chairman of the publicly held French firm, with sales of $200 million. One theory is that homeopathic remedies, like vaccines, crank up the body's defenses. There's essentially no government regulation of homeopathic remedies, on the grounds that doses are so tiny they can't do harm.

CANCER CURES? But they can, opponents argue: Homeopathy can lead patients to neglect proven treatment. Like old-time medicine men, homeopaths claim they can cure or prevent almost anything, even cancer. "Few of us would treat cancer as such, but it's the end stage of a long physical imbalance," says Dr. Edward Chapman, a Boston physician who is president of the American Institute of Homeopathy. The AIH's roughly 300 members are nearly all M.D.s who prescribe classic medicines as well. But untrained practitioners abound.

Skepticism on homeopathy is widespread. A recent Consumer Reports article, which cited the lack of conclusive studies, cast serious doubt. Yet many who have tried it claim it works. "If my two-year-old gets a bruise, I give him arnica"--an exotic plant--"and the bruise disappears before your eyes," says Jerry Hickey, owner of New York's Hickey Chemists. Among his customers, he says, are film and TV stars who use arnica after plastic surgery to prevent bruising. Homeopathy purportedly works on infants and animals, which boosters say is proof that the remedies aren't just placebos.

It will take more than that to convince America's medical Establishment. But makers of these mystical remedies are finding an eager U.S. market awaiting them nonetheless.POPULAR HOMEOPATHIC

REMEDIES

Ailment Remedy Common name

COUGH Arum triphyllum Indian turnip

FLU Anas barbariae Duck heart/liver

HEMORRHOIDS Sepia Cuttlefish ink

HERPES Rhus toxicodendron Poison ivy

MIGRAINE Lac caninum Dog's milk

SEASICKNESS Tabacum Tobacco

DATA: BUSINESS WEEK

Stewart Toy in Lyon, France, with Mike McNamee in Washington and Ruth Pearson in New York


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