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AMRI to end operations at Hungary site by next Friday

By Nick Taylor , 22-Mar-2012
Last updated on 22-Mar-2012 at 11:52 GMT

AMRI is to end operations at its discovery and chemistry services facility in Hungary by the end of next week.

When AMRI set up in Hungary in 2009 it expected the Budapest site to ‘transform’ its European hub but the opening coincided with upheaval in the biopharmaceutical sector. Industry shifts contributed to the unit dragging on financial performance for several years and ultimately to the axe falling.

[By March 30 AMRI will] reduce its staff to those necessary to complete the closure of the Budapest facility. The restructuring plan will affect approximately 100 employees”, the New York-based firm wrote in a filing with the US Securities and Exchange Commission .

The 100 people AMRI employs in Hungary represent one-sixth of its total headcount outside the US. Reduction in overseas staffing follows the mothballing of a facility at the AMRI headquarters in New York. Further cuts are still possible.

Although our outlook for growth in outsourced contract services by our customers remains positive we continue to evaluate our global infrastructure and customer trends for additional opportunities to streamline operations”, AMRI wrote in the annual report it published last week.

Underperforming assets

In January Thomas D’Ambra, CEO of AMRI, told Outsourcing-Pharma weak performance in Hungary had “overshadowed” positives at the company. D’Ambra could have said the same about the assets AMRI acquired in the takeovers of Hyaluron and Excelsyn two years ago.

These acquisitions have not achieved profitability and each such acquisition has required further investment in order to provide a more stable operating platform for the future”, AMRI wrote last week.

A significant reduction in demand from a major client has limited progress at the manufacturing plant AMRI gained in the $19m (€14m) takeover of Excelsyn. Meanwhile, the Massachusetts fill and finish site is yet to recover from the warning letter it received months after AMRI bought it in a $27m deal.

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