Athenex voluntarily suspends production at its Chongqing, China, API plant

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Athenex has voluntarily suspended production at its Chongqing, China, API facility in the wake of explosions earlier this year. (Shutterstock)

New York-based biotech Athenex has voluntarily suspended production at its Chongqing, China, API facility in the wake of explosions earlier this year at chemical plants in China that resulted in the deaths of scores of people.

Athenex, which specializes in novel therapies to treat cancer, announced the closure Thursday, although the “temporary suspension” was initiated last month. The company added that it expects to have a resolution by the end of the third quarter.

Athenex’s move follows explosions that occurred in March and April that triggered industrywide plant inspections by the government focused on production safety. The March 21 accident at the Jiangsu Tianjiayi Chemical Company in Yancheng killed 78 people and injured 617. It was the deadliest industrial accident in the country since 2015, when a Tianjin port warehouse explosion killed 173 people.

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“The decision to voluntarily suspend production activities at the API plant was made to ease concerns from the Department of Emergency Management of Chongqing, which has been evaluating the safety of all chemical and other plants in the region after the recent tragic accidents at other plants in the region," the company said in a statement.

Athenex said it will continue to sell API inventories through the third quarter and has sufficient API inventory for all its near-term planned clinical studies as well as for its registration activities for late-stage clinical products.

The build-out of Athenex’s API plant in Chongqing is near completion and is expected to begin full operations sometime in the first half of 2020. The company also affirmed its product sales guidance of a 25% to 30% increase in 2019 from the product sales revenue of $56.4 million reported in 2018.

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