Amgen indefinitely postpones Irish plant

By Katrina Megget

- Last updated on GMT

Related tags Amgen

Amgen has announced the 'indefinite postponement' on plans for its
$1bn (€0.71bn) manufacturing facility in Cork, Ireland, following
further navel gazing by the company.

The move comes after the announcement back in April that the US biotech company would delay construction of the Irish plant, which was to become its new major manufacturing facility, following a "global assessment"​ of the company's manufacturing needs. According to the company, the latest announcement follows "an updated review of its business plans, concurrent with an evolving business environment"​. While Amgen "expects"​ to maintain ownership of the site, the company announced it would cease current activity in Cork and throughout 2008. Some 79 staff, of which 65 are based in cork, will be affected by the news, with the likelihood of redundancy. "We understand this is a very disappointing development for our employees, the government, the neighbours around our site and the broader Cork community,"​ Amgen Technology Ireland general manager and vice president of operations Mark Sawyer said in a statement. "This decision is based purely on developments relating to Amgen's global business and is in no way reflective of the business environment in Ireland or of the high calibre staff we have hired." ​ The company has struggled of late. In August, Amgen announced it would slash 12 to 14 per cent of its workforce - up to 2,600 jobs - in an attempt to offset the difficulties the company had been facing with the sales of its anaemia blockbusters and save the company more than $1bn over the next year. According to the company's second quarter results released in July, worldwide sales of Aranesp (darbepoetin alfa) decreased 10 per cent to $949m in the second quarter, principally driven by a decline in US demand due to customer reaction to the label and reimbursement changes that had to be implemented. International sales of the anaemia drug did increase by eight per cent though. According to the results, total revenue for the company only increased by three per cent during the second quarter to $3.7bn compared to the same quarter in 2006. At the time, Amgen said: "As part of the Company's global review of its business plans, management decided to make changes to various ongoing capital projects. These decisions were primarily focused on rationalizing the Company's network of manufacturing facilities in order to gain cost efficiencies while continuing to meet product demand. In particular, these decisions include a re-scoping of Ireland manufacturing operations, the construction of which was previously reported to have been delayed, certain revisions to planned manufacturing expansion in Puerto Rico and, to a lesser degree, moderated expansion of research facilities."​ Amgen chairman and chief executive Kevin Sharer said in response to the second quarter results: "This has been a difficult period and this quarter's low growth is a reflection of that reality. That said, we are making progress on many fronts to change this trend and return Amgen to strong future performance."​ The Irish plant was originally due to be operational in 2009, but the delay, announced in April, pushed that behind schedule with the company expecting the plant to be up and running in late 2012 with licensing for the formulation, filing and finishing facilities expected in late 2014. Amgen gave no estimate of when the company hoped the Irish plant could make a come back and be operational by. A spokesman from Amgen was unavailable for comment at time of publishing.

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