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| Novartis' Suffern, NY, plant--Courtesy of Mwanner, CC BY-SA 3.0. |
When Novartis ($NVS) put a closure target on its plant in Suffern, NY, it indicated that it might go as far as to strip out the equipment, raze the buildings and sell empty land. But the 160-acre campus is now officially on the block and being brokered as a great buy for the right drug manufacturer.
On Monday, real estate brokers Cushman & Wakefield of New Jersey listed the site, which has employed 525 people, as among the 10 largest pharma manufacturing facilities in the U.S. with its capacity to manufacture billions of capsules or caplets a year.
"For a pharmaceutical company, this offering would be very attractive because of all the equipment that is still in place and operating," Andrew Merin of Cushman & Wakefield told Westchester County, NY's The Journal News. "The cost to construct a similar campus would likely exceed $400 million."
Novartis announced in January that it would close the Diovan manufacturing facility by 2017, transfer workers who handle certain "necessary functions," and lay off the rest of its 525 employees. A generic of Diovan had yet to come to market at the time because of the issues the FDA had with the manufacturing facilities in India where Ranbaxy Laboratories intended to manufacture its authorized copy. But Novartis said it was just a matter of time. And that time is now. In June, the FDA agreed to let Ranbaxy manufacture the heart drug at its Ohm Laboratories plant in New Jersey.
The actions the FDA has taken at Indian plants operated by Ranbaxy, Wockhart and others could create some demand for a large FDA-approved facility in the U.S. Analysts following the Indian pharma manufacturing industry have indicated that with all of the bad publicity surrounding import alerts at high-profile plants in India, some drugmakers there are looking to build, or buy, operations in the U.S. Indian drugmaker Glenmark Pharmaceuticals is building a new facility in North Carolina, its first in the U.S.
Drugmakers buy facilities from one another all of the time when they acquire units or are looking for capacity that someone else is shedding. In fact, in 2012 Novartis bought a plant in New Jersey for $43 million from Dendreon ($DNDN), when that company was first having financial difficulties and was looking to cut costs.
- read the Journal News story