|AstraZeneca's Pam Cheng|
AstraZeneca and Amgen ($AMGN) are proving the axiom that one man's trash is another man's treasure. U.K.-based AstraZeneca is buying and intends to eventually employ 400 at a Colorado biologics plant that Amgen last year closed as part of its massive two-stage move to lay off 4,000 people.
AstraZeneca ($AZN) said today that it has bought the plant and will immediately start refurbishing it, with the expectation that it will be ready to go in 2017. The addition doubles AstraZeneca's biologics capacity in the U.S., which it said is needed given that half of the 120 drugs in its pipeline are large-molecule candidates, including 30 in the clinic.
"This site will play an important role in our future commercial production and give AstraZeneca and MedImmune, our global biologics research and development arm, the flexibility and capacity to meet the needs of our rapidly growing biologics portfolio," Pam Cheng, executive VP of operations and IT for AstraZeneca.
Like other drugmakers, AstraZeneca is turning more to large-molecule, large-profit specialty drugs to drive its future. Hammered by generic competition for blockbuster acid reflux drug Nexium, AstraZeneca has been working to reprioritize its pipeline, trying to break into the hot immuno-oncology field and cancer vaccines. In August MedImmune unit announced a development deal worth up to $727 million to acquire exclusive rights to Inovio Pharmaceuticals' ($INO) HPV cancer vaccine INO-3112 and to develop additional cancer vaccine candidates.
With more biologic drugs in its future, AstraZeneca has been making sure it has the capacity to produce them. Last year it laid out plans to invest more than $200 million to expand a biologics facility in Frederick, MD, then followed that in May with the announcement that it would build a $285 million biologics facility in Sweden where it will add 250 jobs. It said the Sweden project was one piece of a "three-part program to expand AstraZeneca's biologics manufacturing capabilities," details of which will be provided in "coming years."
The 300,000-square-foot plant AstraZeneca is getting from Amgen is in Boulder. Amgen put a For Sale sign on the facility last year after deciding it would be sacrificed as part of its plan to boost its share price by cutting its employee roster. The California biotech first said a 15% cut was in order, along the lines of 2,900 people. Two months later it expanded the reduction to 20% of its 20,000 person workforce, with another 1,100 jobs targeted as active investor Dan Loeb was breathing down its neck to break up the company into more efficient pieces. The company's share price has since grown more than 12%. Its staged cuts in the Boulder area amounted to about 650 people.
- here's the release