Reprieve for Boehringer plant as Chinese buyer comes forward
pharmafile | November 3, 2014 | News story | Manufacturing and Production |Â Â Boehringer, China, Petersburg, UniTao PharmaceuticalsÂ
A US manufacturing facility cued up for closure by Boehringer Ingelheim has been bought by a Chinese drugmaker.
Boehringer had said it would close the facility in Petersburg, Virginia, by the end of this year – placing 240 jobs at risk – but the sale to UniTao Pharmaceuticals will not only save those but also lead to the creation of 376 more.
Boehringer Ingelheim Chemicals manufactures active pharmaceutical ingredients (APIs) and stands on a 180-acre site that has benefited from more than $150 million in investment by the German company in recent years, but had been deemed to no longer be a viable business thanks to low-cost competition from Asia.
Active substances made at Petersburg include telmisartan, the active ingredient in Boehringer’s high blood pressure drug Micardis which was once a $2 billion-a-year product, but lost patent protection in the US at the start of last year. It is also a major supplier of methylphenidate used in the treatment of attention-deficit hyperactivity disorder (ADHD).
The company had tried to find a buyer for more than a year before UniTao – a subsidiary of Shanghai-based API and finished dosage form manufacturer Tenry Pharmaceutical – came forward with its $22.5 million rescue plan.
Virginia’s Governor Terry McAuliffe said in a statement that he had met with company officials whilst on a visit to China last month to officially close the deal, adding: “This project will have a tremendous impact in the City of Petersburg and the surrounding region.” Virginia competed against locations in California and China for the project, he says.
The Petersburg facility will be Tenry’s first plant outside the US and will – according to UniTao chief executive Tao Ye – “enable us to start operations quickly and better meet marketplace demands in the US and elsewhere”.
The Governor’s office is providing a $1m grant to help UniTao get the takeover underway and says the company will also be eligible to receive a job tax credits as well as sales and use tax exemptions on manufacturing equipment.
At its height Petersburg employed some 500 workers, but one of the buildings on the site was shut down in 2012 – eliminating 100 jobs – and an employment freeze in the interim has seen numbers dwindle.
Phil Taylor
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