Merck to buy back Riverside plant for key API supply

By Gareth Macdonald

- Last updated on GMT

Related tags Pharmacology Pharmaceutical drug Merck

US drugmaker Merck & Co has announced plans to reacquire a Pennsylvania manufacturing plant to guarantee supply of key active pharmaceutical ingredient (API).

The facility in Riverside near Philadelphia, which makes ingredients for the antibiotics Invanz and Primaxin and the cholesterol drug MK524, was sold in 2008​ as part of a Merck cost cutting programme.

Current owners PRWT and Cherokee Pharmaceuticals, which had continued to supply Merck, are selling back the plant because of the “challenging environment in the pharmaceutical industry​" according to spokeswoman Sherri Kyle-Jones.

Kyle-Jones did not go into more detail but, according to an article in the Philadelphia Inquirer​, PRWT, which doubled its manufacturing capacity with the acquisition, was unable to develop a large enough customer base for the Riverside plant.

Cherokee Pharmaceuticals spokesman Betse Humphrey told The Daily Item​ that: "The past 2 1/2 years as a standalone company have provided the Cherokee site with a valuable opportunity.

"Employees learned how to think as entrepreneurs and manage operations in a highly competitive environment. Those lessons will serve us well as we rejoin the Merck network.​"

Merck's manufacturing network

The news comes just weeks​ after Merck announced plans to shut down eight manufacturing facilities and eight R&D labs following its $41bn (€32bn) mega merger with Schering Plough.

Merck did not respond to in-pharmatechnologist’s request for more information on the reacquisition but, according to spokesman Ron Rogers who was quoted by the Associated Press​, the plant makes “a product that's critical to our supply chain​.”

Rogers went on to explain that the mutually agreed deal will be completed early next month, after which point Merck will endeavour to “gain a fuller picture of the current manufacturing portfolio, as well as the capacity and the financials​."

The move will leave Merck with 78 manufacturing facilities around the world, which is a reduction from the 91 it operated after completing the Schering-Plough takeover.

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