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Pfizer seeks CROs for UK site as council waits for gov action

By Nick Taylor , 01-Jun-2011

Pfizer continues to search for CROs to occupy a UK site but the local council is disappointed by the lack of governmental action.

By the end of 2012 Pfizer plans to exit the Sandwich, UK site, affecting 2,400 employees and 900 onsite contractors. Another 10,000 jobs are under threat at other local businesses and the council hopes Pfizer can avoid adding to this by moving staff to contract research organisations (CRO).

Pfizer is progressing commercially confidential negotiations with potential CROs and exploring the potential for small spin-out companies to develop from the site which could potentially involve a few people”, said the Sandwich Economic Development Task Force .

Moving Pfizer staff and assets to CROs is viewed by the Task Force as the first phase of a five step transition process. With a core of CROs in place, hopefully in the first half of 2011, the Task Force will look to attract start-ups and large-scale occupiers to take on whole buildings.

To support this process the Task Force made a number of proposals to the UK government but has been disappointed by the lack of action. Pfizer has already sent ‘at risk of redundancy’ notices to 900 staff making the next month critical for the future of the Sandwich site.

If there is to be some form of state aid, it is needed now”, said the Task Force.

Increasing attractiveness

Buildings on the Sandwich site cover 3m sq ft, which is, as David Windley, equity analyst at Jefferies & Company noted, “pretty close to 3m sq ft more than any vendor needs in early development”.

However, incentives could be used to encourage CROs to occupy the site. “Given the likely negative impact to the local/regional economy, the potential for government incentives to help underwrite the cost for new entrants is very high”, said Windley in a report released in April.

Transport links to and from London are one area that needs to be improved. From October trains will transport passengers from Sandwich to St Pancreas, London in 90 minutes but the Task Force hopes line speed enhancements will reduce travel times to one hour.

Last week Pfizer inked strategic deals with Icon and Parexel but made no mention of transferring assets or staff to the CROs. Strategic deals made by other pharma companies, such as Eli Lilly and Sanofi, have included requirements for the CRO partners to take on assets and staff.

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