In a lawsuit likely to bring more heated debate over the extent of German corporate guilt, Eva Mozes Kor claims that under Bayer's supervision she and her twin sister were bought from the Nazis and used as human guinea pigs.

Ms Kor, now of Terre Haute, near Indianapolis, Indiana, has alleged that she was deliberately infected with a series of diseases 'to test the effectiveness of various drugs manufactured by Bayer.'

The Kor sisters were aged nine when they were taken to Auschwitz, one of 1,500 sets of twins to undergo experiments led by Mengele.

Unlike most victims, they survived the 10-month ordeal and were liberated by Soviet troops in January 1945, but Eva's sister, Miriam, died in Israel in 1993 after years of illness. The lawsuit alleges that her kidneys never developed fully as a result of the experiments.

'It's impossible to put on a scale the various horrors of the Holocaust, but this case represents the worst example of individual and corporate evil that the legal system may ever see,' said Irwin Levin, one of the lawyers handling the case.

The lawsuit alleges that, as well as co-operating with Mengele, Bayer - then part of the I. G. Farben industrial empire - gave orders to an SS surgeon who also carried out experiments.

Ms Kor has claimed that Bayer 'monitored and supervised those experiments, and used them as a form of research and development for its corporate benefit.'

Thomas Reinart, a spokesman for the company, which is based in Leverkusen, said Bayer was as yet unaware of the claim and had no comment.

The firm recently admitted using slave labour during the second world war, and was one of 12 German companies which agreed to contribute to a £1 billion reparations fund, set up by the German chancellor, Gerhard Schröder, on Tuesday. Ms Kor submitted her claim the next day.

It had been intended that the fund, which will compensate former slave labourers, would forestall a flood of group actions presently going through United States courts and avert a threatened boycott of German companies at a time when the wartime conduct of many firms is subject to renewed scrutiny. It was recently revealed that Deutsche Bank, Germany's largest bank, provided finance for the building of Auschwitz.

The new compensation fund was set up after months of negotiations between the German government, German firms and lawyers representing survivors, to 'counter lawsuits . . . and to remove the basis of the campaign being led against the reputation of German industry and our country,' Mr Schröder said.

'There is no point in German companies paying twice,' he added.

However, Ms Kor's claim in the US district court suggests the fund will not pre-empt further efforts to sue German companies for their wartime role.

Her lawsuit is the first of its kind because it alleges that Bayer was directly involved in some of the most horrifying war crimes in history, rather than merely profiting from the Nazi regime.

The prosecution case stated that Bayer gave orders 'to SS Major Dr Helmuth Vetter who was associated with Bayer and who was stationed in several concentration camps. Dr Vetter experimented in Auschwitz with medications . . . that were administered to healthy inmates who had first been rendered ill from infections that were intentionally administered through pills, powders, injections or enemas.' Vetter was sentenced to death by a US military court in 1947 and executed in 1949. Mengele was never brought to justice, and lived under a false name in Brazil until his death in 1979.

In Auschwitz, Mengele directed a programme of crude medical operations on twins, designed to investigate the effects of bacteria, chemicals and viruses on the human body. Twins were used so that one sibling could be used as a 'control.'

Ms Kor seeks unspecified punitive damages and the recovery of profits that she claims Bayer earned as a result of such research.

She has also said she wants an apology.

'After 54 years, it is time that Bayer takes responsibility for their actions,' she said. 'That means that they should give proper restitution, say they are sorry for what they have done and say they will never use another human being as a guinea pig. This represents the worst example of individual and corporate evil' 'After 54 years it is time that Bayer takes responsibility for its actions.'