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For Sale: Another Merck & Co API Plant - Cost, 280 Irish Jobs

By Dan Stanton , 11-Mar-2013

MSD says plans to shutter an Irish API facility are not part of an outsourcing strategy and intends to relocate both staff and manufacturing.

280 people working at the Wicklow, Ireland active pharmaceutical ingredient (API) production facility were told last week that MSD – known as Merck & Co in the US and Canada – plans to cease operations at the site as part of the company’s ongoing manufacturing review.

Speaking with this publication, site director John Smith said that MSD’s decision to close the plant was “not part of any initiative to outsource production.” Though there are plans to outsource the manufacture of APIs for some older drugs which have lost their patent,  Smith said the majority of production would be shifted to MSD’s other facilities in Ireland and Singapore.

Official reasoning behind the closure was, according to a press statement, part of MSD’s “ongoing review of its worldwide manufacturing capabilities that has resulted in sites being sold, closed or consolidated in all regions of the world.”

As for the future of the facility, Smith said MSD "will be working jointly with the Irish Industrial Development Authority (IDA) to seek a buyer for the site.”

The Wicklow plant currently manufactures APIs for such products as allergy drugs Claritin, Clarinex and the anti-fungal drug Noxafil.

People on the Move

The news comes just weeks after confirmation that MSD is selling its Dutch API facility - acquired as part of MSD’s purchase of Schering-Plough for $41bn (€31bn) in 2009 - to Aspen Pharmacare. MSD confirmed to us at the time that all 950 jobs at the Oss plant would be safe and it would be “business as usual” as the plant changed hands, becoming a contract manufacturer of APIs for MSD.

The news was not so bright for the 280 personnel at Wicklow, which is also an ex-Schering-Plough facility. However, Smith told us that “there will be no reduction in staff until the end of 2014” and added that Wicklow “employees will get priority in applying for positions that come up” in MSD’s four other Irish facilities in Dublin, Cork, Carlow and Tipperary.

However, according to Services Industrial Professional and Technical Union (Siptu) Organiser Frank Jones the nearest site to Wicklow is in Carlow which is “a fair old drive” away. Furthermore Jones told us that the other sites are not recruiting at the moment.

MSD Continues to Invest as they Hunt for a Buyer

Jones also said that in a meeting with management last week he had obtained a “commitment from MSD that they will continue to invest in Rathdrum up until the day they vacate the site,” giving hope that MSD may be lining up a buyer or even making a U-turn under the right economic circumstances.

When in-Pharmatechnologist.com posed this to Smith he said that as the facility intends to operate until the end of 2015, it needs to “continue to meet all applicable safety, environmental and GMP regulations.” He continued, adding that "the facility will have to be kept up to modern standards" in order to encourage a buyer for the site.

Ireland

The luck hasn’t been with the Irish pharmaceutical manufacturing industry in the last few years with MSD adding to the list of companies who have cutback operations in the Emerald Isle.

Pfizer announce it would cut almost 200 jobs at two API facilities in Cork last year, an area previously hit by job loss due to a phase out of API production by Corden Pharmachem . Furthermore, closures and turnarounds by Amgen , Abbott and Gilead have also left a negative impact on the landscape.

Jones explained the recent spate of lay-offs: “These big companies have excess capacity and are trying to run a tighter ship and expand profits.”

However, it hasn’t all been bad news as Hovione has invested in the API plant it purchased from Pfizer in Cork and last month 100 jobs were announced at Genzyme’s Waterford plant following a second investment by parent group Sanofi .

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