Pfizer’s decision to close its legacy Hospira plants in Aurangabad and Irungattukottai, India, may have come as a surprise to employees, but the loss of about 1,700 jobs is being eased by a handsome compensation package from the company.
Pfizer is offering 75 days of wages for every year of service with the company as well as all bonuses and payments required by statute in India, according to a severance package cited by Business Standard. An incentive of Rs. 7 lakh (about $9,900) is also up for grabs for those who sign up early, per the newspaper.
“An attractive financial scheme that is significantly higher than the legal requirements has been offered to Pfizer colleagues,” a Pfizer spokesperson told FiercePharma but declined to provide details.
In a last-ditch attempt to get something out of the plants, Pfizer is still open to exploring all options for the two facilities it is determined to “exit,” including a sale, Business Standard previously reported. But it also admitted that “at this moment we believe a sale that retains colleagues is unlikely,” according to a Pfizer spokesperson cited by the newspaper.
Pfizer has decided to cut the two plants after conducting a “thorough evaluation,” the company previously told FiercePharma, citing “very significant long-term loss of product demand.” Manufacturing has already stopped with the intention to shut down both as soon as possible, the company said.
The Irungattukottai plant currently employs about 1,000 and Aurangabad about 700. And if Pfizer, as it expects, can't identify a buyer, these workers will be axed.
The U.S. drugmaker got the two plants through the $15 billion acquisition of Hospira in 2015. The Irungattukottai plant has a tainted compliance record from before the acquisition. It was the target of an FDA warning letter in 2013 and about six months ago was cited in an 11-observation Form 483.
Elsewhere, another legacy Hospira plant in McPherson, Kansas, is also causing Pfizer headaches. Having also been criticized by the FDA—the latest being a Form 483 in late 2018—and put on operational hold, the facility has notoriously contributed to some injectable opioid analgesics supply shortages for U.S. hospitals.