Chinese company takes over Boehringer U.S. plant as German drugmaker expands in China

In a bit of a turnabout, Boehringer Ingelheim has landed a buyer from China for a U.S. plant it was closing even as it is building up its manufacturing operations in China.

The German drugmaker says it is selling the API plant in Petersburg, VA, to UniTao Pharmaceuticals, a subsidiary of Shanghai-based Tenry Pharmaceutical. Tenry has about 500 employees and a finished dosage facility of about 150,000 square meters in Shanghai.

Terms of the sale were not disclosed, but UniTao plans to invest $22.5 million and eventually employ 376 there, according to an announcement from the governor's office. The 240 Boehringer employees at the plant will be able to reapply for their jobs, according to the Richmond Times-Dispatch.

The drugmaker has been cutting jobs and costs as revenues overall fell 3% and pharma sales were off 5.4% in the first half of the year. In an email, the company said, "Due to challenges in excess capacity over the past several years, Boehringer Ingelheim Chemicals Inc. (BICI) made the difficult decision to cease all operations in Petersburg, VA, by the end of 2014. Between the time of that announcement in August 2013 and the sale of site assets, BICI conducted an extensive search for a suitable buyer before entering into agreement with UniTao Pharmaceuticals."

It is the second U.S. plant that Boehringer Ingelheim has given up in the last year. It closed its long-troubled sterile manufacturing plant in Bedford, OH, at the end of last year, laying off more than 1,000 workers. Jordan's Hikma this year bought the plant as part of a $300 millon deal to get the sterile injectable drugs that Boehringer has sold uner its Bedford Laboratories brand. 

Boehringer announced its decision to close the plant in Virginia and lay off the 240 workers in August 2013. A month later it said it would spend €70 million ($95 million) to expand its research and development and manufacturing and operations in Shanghai. The company said it would add more than 100 jobs at the plant, building employment to 350. It expects to be able to triple production by 2018 to 220 million packages. The upgraded plant also includes a packaging and distribution center.

Boehringer claims to be among the fastest growing drug companies in China, a market it has been in since 1984. And the current expansion is not its only project there. In June 2013, it created a strategic alliance with Zhangjiang Biotech & Pharmaceutical Base Development (ZJ Base) in Pudong, Shanghai, which will build a facility under BI's tutelage. The plant will help develop and manufacture biologic drugs using mammalian cell culture technology. BI will invest €35 million ($44.9 million) in the plant, which it expects to be operating in 2016.

- here's the Sept. 2013 announcement
- and the Times-Dispatch story
- read more from in-PharmaTechnologist