U.K. respiratory drug specialist Vectura picked up a plant last year when it bought Germany's Activaero in a €130 million ($181 million) deal. But Vectura has decided it doesn't need it and will close the facility within a year in a cost-saving move.
The facility in Gemünden makes nebulizer devices that Activaero used in the clinical trials of its pipeline of respiratory treatments and which it also marketed to other companies. Vectura cited the proprietary technology as one of the benefits when it bought the German company in March 2014.
But Vectura said in a release filed with the London Stock Exchange that it will move the work done in Gemünden to its three other facilities in Gauting, Germany, and Chippenham and Cambridge, U.K., as well as to a contract manufacturer it did not name. It said the facility will closed by March 2016.
"The decision to close our Gemünden site was a strategic and necessary one. It will rationalize our business operations and deliver more cost-effective production of our nebulizers," Vectura CEO Chris Blackwell said in a statement. "We retain the capabilities and capacity at our three remaining sites to support all our business operations."
Vectura did not say how many employees work at the facility, but Activaero reportedly had about 50 employees at two sites when Vectura bought it. At the time of that deal, Vectura said it expected to find about €1.5 million ($1.6 million) in "near term synergies," or cost savings but indicated that would come from eliminating duplicate head office and administrative costs.
Vectura developed its reputation with respiratory generics and with partnership with Big Pharma players like Novartis ($NVS) and Baxter ($BAX). It and partner Sandoz have developed AirFluSal Forspiro, a generic of GlaxoSmithKline's ($GSK) multibillion-selling Advair. It is approved in some countries in Europe but is not automatically substitutable. With the Activaero acquisition, Vectura set itself up to deepen its pipeline of proprietary treatments that will allow it to evolve into a specialty pharma company capable of standing alone.
Meanwhile, GSK has been expanding its production for its newer respiratory products Anoro and Breo. It has invested about $90 million in the plant in Zebulon, NC, where those drugs and two other more recently approved respiratory meds, Incruse and Arnuity, are made. It also manufactures there the Ellipta inhaler that dispenses them.
- here's the announcement