OSHA fines a Wisconsin API maker that no longer exists almost half a million

A federal regulator has come down hard on an active pharmaceutical ingredient maker in Wisconsin, citing it for nearly two dozen violations, 7 that it calls willful, and recommending a fine of nearly $500,000. But the company, Fontarome Chemical of St. Francis, WI, no longer operates.

Fontarome was put into state receivership in January. Its assets have since been acquired, and the new owners have no responsibility for the fine from the Occupational Safety and Health Administration (OSHA), Rhonda Burke, a spokeswoman with the regulator, explained Monday. "The fine stays with the previous company," Burke said. OSHA also will not go back into the plant unless it gets a new complaint. "Basically, because of the new ownership, the violations don't follow," she said.

But when Fontarome was operating, it was a bad player, OSHA said last week. The agency issued 23 citations against Fontarome and proposed $449,680 in penalties, the agency said in a statement. The company was also placed on OSHA's Severe Violator Enforcement Program. OSHA found the problems during a December inspection, which was a follow-up after a fire at the plant in April 2012. It pointed out that the facility used the chemical thionyl chloride, exposure to which can result in serious respiratory, eye and skin problems. One of the violations was a repeat for not properly fitting employees required to wear full and half-face, air-purifying respirators. There were also two "willful violations" for failing to provide ventilation for emissions and for not replacing temporary wiring installed during the fire restoration.

"It is clear that Fontarome Chemical continued to fail in its obligation to create a safe working environment for employees managing highly hazardous chemicals," Chris Zortman, OSHA's area director in Milwaukee, said in a statement. "OSHA is committed to ensuring conditions are improved at the plant and that all cited safety violations have been corrected by the current company management."

Fontarome Chemical is not the only pharma company to face labor citations tied to a fire. California-based Amgen ($AMGN) received a California OSHA citation in November for an explosion at the biotech in May 2013 that injured an employee engaged in hazardous waste disposal. Then in January, another explosion was reported at the biotech, this one sending two workers to the hospital.

But Fontarome Chemical is no more. In April, Milwaukee-based SFM Investments bought the plant and other assets of Fontarome out of receivership, paying $2,525,000 for it and French distribution subsidiary FCI, explained Patrick McConis, CEO of the new company, in a phone interview Monday.

McConis is a principal in SFM along with Joe Froehlich. In May, the new owners changed the company name to Apiscent Labs--a combination of "API" and "scent," the primary industries, along with flavorings, that the company serves, he said. McConis, who is trained as a pharmacist and has worked in the pharma industry, said they have big plans for Apiscent. Since taking over they have hired 13 people, bringing employment to 45, and expect to have 55 by the end of the summer.

"Our sales are exceeding our production capacity right now," McConis said. All of its products are produced at a 50,000-square-foot facility on the company's St. Francis site. The operation also has a 30,000-square-foot R&D and warehouse facility there. McConis said they expect to add a second facility to separate the API production, done under GMP standards, for the production of scents and flavorings and to build capacity.

"One of the reasons I think we are destined for success is that the orphan drug laws have allowed boutique companies to develop drugs for a limited market and they are looking for companies who can make APIs for them," McConis said.

- here's the OSHA announcement
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