The conversion of isopenicillin N into penicillin N in Acremonium chrysogenum is catalyzed by an epimerization system that involves an isopenicillin N-CoA synthethase and isopenicillin N-CoA epimerase, encoded by the genes cefD1 and cefD2. Several transformants containing two to seven additional copies of both genes were obtained. Four of these transformants (TMCD26, TMCD53, TMCD242 and TMCD474) showed two-fold higher IPN epimerase activity than the untransformed A. chrysogenum C10, and produced 80 to 100% more cephalosporin C and deacetylcephalosporin C than the parental strain. A second class of transformants, including TMCD2, TMCD32 and TMCD39, in contrast, showed a drastic reduction in cephalosporin biosynthesis relative to the untransformed control. These transformants had no detectable IPN epimerase activity and did not produce cephalosporin C or deacetylcephalosporin C. They also expressed both endogenous and exogenous cefD2 genes only after long periods (72-96 h) of incubation, as shown by Northern analysis, and were impaired in mycelial branching in liquid cultures. The negative effect of amplification of the cefD1 - cefD2 gene cluster in this second class of transformants is not correlated with high gene dosage, but appears to be due to exogenous DNA integration into a specific locus, which results in a pleiotropic effect on growth and cefD2 expression.