I am writing in response to a Jack Anderson column {Aug. 2}.

The story in question involves the Orphan Drug Act. It is true that we developed and market an orphan drug -- a drug for rare conditions -- to treat growth-hormone-deficient children. It is also true that we are opposed to legislation that would breach the contract with the government that granted us seven years to market this product.

The column claimed that for some vaguely improper motive the House of Representatives has thwarted competition. What is missing from the story is a recognition that a majority of the Democrats in the House rejected the bill the column claims is pro-competition.

Also missing from the column is the fact that the author of the bill the column appears to support, Rep. Henry Waxman (D-Calif.), agreed to the compromise and supports its enactment. While it is true the opposition of the administration to the bill was helpful in clarifying the substantive issues, it hardly determined the outcome. The failure of Congress to enact a bill that would have taken away vested property rights is hardly a surprising event. It is especially not notable when that conclusion was reached by a bipartisan majority.

The assertion in the column that the original legislation on orphan drugs would have created competition is a claim that bears a more complete examination. First, under current law there is no bar on other companies from using an orphan drug for new uses.

Second, as the holders of a vast majority of orphan-drug designations have recognized, creation of "shared exclusivity," as suggested in the original bill, would destroy the incentives that have created hundreds of new orphan-drug research activities.

The column asserts that we are promoting a human growth hormone for unapproved indications. This allegation is totally without factual basis. The column also implies that we obtained unfair benefits from President Bush as a result of "substantial" campaign contributions. The Genentech PAC made a $1,000 contribution to the Bush campaign in 1987.

DAVID BEIER Vice President, Government Affairs Genentech, Inc. Washington