“We are adding approximately 12,000 gallons of reactor capacity” to the plant, which currently has about 60,000 gallons of capacity, David DeCuir, Albemarle’s director of fine chemistry services, told Outsourcing-Pharma.com. “The building is being designed to allow rapid equipping of the rest of the building with additional reactors (as much as an additional 18,000 gallons of reactor capacity depending on configuration) as needed to support our Custom Services business.”
Albemarle in November also began a separate expansion of the site and eventually expects to increase its reactor capacity at the site by 40%. The expanded portions of the plant are expected to be operational in the second quarter of 2014, DeCuir said, though no customers or products are currently specified for this expansion. He added that the company cannot predict what will be initially produced with the new equipment but Albemarle’s custom services business “has some projects in the development pipeline, and we are actively soliciting new products from the marketplace to put into the equipment.”
The additional equipment from the expansion can be used to make a variety of products and the building “is designed for easy expansion; therefore, multiple products will likely be produced at this facility,” with multiple customers, DeCuir said.
The decision to expand specifically in Pennsylvania, as opposed to its other manufacturing facilities in Michigan or South Carolina, seem manifold. “We felt this site was the most logical choice for the expansion as we could design a building and infrastructure that easily increases our capacity, we have the technical team here and already trained to meet customer needs and we received great support from the local community and the state of Pennsylvania,” DeCuir added.
Albemarle’s expansion in Pennsylvania is part of a another expansion of capacity in API manufacturing in Michigan.
Demand for custom and generic APIs spurred the plant expansion in Michigan in July 2012. The company said its custom API work doubled between 2010 and 2012.
But the capacity expansions in Pennsylvania and Michigan seems to contrast with recently announced earnings, which showed a decline in 2012 when compared to 2011. Earnings for 2012 were $311.5m, compared to $392.1m for 2011.
“2012 was a difficult year from a macroeconomic standpoint, but we are pleased with the earnings power that we demonstrated in the face of a weak global economy, the negative impact of raw material pricing related to certain metals and lower demand than originally anticipated in many of the markets served by our products,” CEO Luke Kissam said.