Pfizer has completely remade itself in the face of patent expirations for blockbusters like Lipitor. The drugmaker last year sold its nutrition unit to Nestlé, and this year it finished the sell-off of its animal health business, Zoetis ($ZTS), moves that pleased investors. But its last quarter reflected ongoing drag from generic competition, and so the drugmaker keeps whittling away at costs where it can. The latest is its manufacturing operations in Puerto Rico, which have already been slimmed down in recent years.
The drugmaker ($PFE), pointing to improved manufacturing efficiencies and lingering patent losses, said it will close a plant in Barceloneta by 2017, according to the Associated Press. It said it doesn't yet know how many employees will lose jobs as a result. It has three plants and about 2,700 employees on the island, according to the Associated Press.
Last month, the drugmaker reported that sales for the quarter were off 2% to $12.6 billion. It saw sales improvement in emerging markets and for some drugs. But it was also hurt by continuing revenue drops tied to generic competition for Lipitor, as well as the patent loss for Viagra in Europe. It lowered its full-year revenue forecast by $1 billion, to $51.8 billion, but it also projected it would cut costs by about $500 million.
Pfizer has been doing that, in part, by slicing away at its manufacturing network around the globe. The spinoffs of the nutrition business and its animal health operations shrunk its manufacturing network by 30 facilities. In September, it said it would close a plant in Sydney, Australia, where about 140 workers manufacture both human and animal medications, by 2015.
The latest announcement is a tough one for Puerto Rico, which had become a manufacturing hub, boosted by tax incentives that have since been withdrawn. Last week, Merck ($MRK) said it would cease production at an active pharmaceutical ingredient plant in Barceloneta late next year and move the formulation and packaging done at the facility to a contractor. It also intends to move formulation operations at its plant in Arecibo to its Las Piedras facility, and all of that work will go to a contractor by the end of 2016, it said. The pharma didn't say how many jobs would be eliminated in that move. About a year ago, Pfizer sold a 1.4-million-square-foot plant in the San Juan suburb of Caguas to Mexican drugmaker Neolpharma, which said it would keep the 130 employees. It also had a plant in Carolina, Puerto Rico, that makes injectable drugs for sale.
- read the Associated Press story