ImmunoGen has decided to turn to contractors for all of its manufacturing needs, a move that will mean a small facility in Massachusetts will close and 20 workers will be let go.
The Waltham, Massachusetts-based specialist in antibody-drug conjugates made the announcement last week when it released its earnings. ImmunoGen said it will move manufacturing and quality testing solely to contractors.
The move, which is expected to save $20 million over five years, will allow it to gain access to external expertise and benefit from “advances in contract manufacturing capacity,” the drugmaker explained.
The company will continue to use its 25-year-old Norwood, Massachusetts, manufacturing and testing facility for the rest of the year, at which point it will close and its 20 workers will be let go.
CEO Mark Enyedy explained in a call with analysts that as the company has shifted away from “broad-based partnerships” for ADC drugs with companies like Roche and Novartis, its capacity needs at Norwood have declined. ImmunoGen technology is used in Roche's cancer drug Kadcyla, for example.
The decision is also is in line with future needs, Enyedy said, as the company looks toward 2018 revenues of between $60 million and $65 million and operating expenses between $185 million and $190 million. CFO Dave Johnston told analysts the company expects to end 2018 with between $115 million and $120 million of cash and cash equivalents, which with revenues will carry it through the first quarter of 2019, when some important milestones should be realized.