Manufacturing Investment in Puerto Rico

Puerto Rico seeks to build its standing in biopharmaceutica manufacturing and research as it retains its role in bulk pharmaceutical and dosage manufacturing for small molecules.
Jan 02, 2008
Volume 32, Issue 1
As the pharmaceutical industry undergoes restructuring, facility rationalization, and a shift toward biologics, Puerto Rico is keeping pace with a strategy to attract investment in research, manufacturing, and science education in biologics. Although small-molecule and solid-dosage form manufacturing remains important for Puerto Rico, the commonwealth is strengthening its commitment to the life sciences with further investments in drug discovery and biotechnology.

Pharmaceutical strength

Puerto Rico is a major site of pharmaceutical activity. Pharmaceutical shipments from Puerto Rico to the United States were valued at $35.17 billion in 2006, an increase of 1.3% from $34.71 billion in 2005, according to data from the Puerto Rico Industrial Development Company (Pridco), a government-owned business development agency. Puerto Rico has roughly 58 pharmaceutical manufacturing facilities (see Figure 1) and 27,000 people employed in the industry.

Figure 1. Figure 1 courtesy of Puerto rico Industrial development Company
Thirteen of the 20 top-selling drugs are either partially or completely manufactured in Puerto Rico, according to Puerto Rico Industrial Development Company. Based on 2006 rankings, these drugs include: "Lipitor" (atorvastatin), "Plavix" (clopidogrel), "Nexium" (esomeprazole), "Norvasc" (amlodipine), "Enbrel" (etanercept), "Zyprexa" (olanzapine), "Risperdal" (risperidone), "Aranesp" (darbepoetin alfa), "Effexor" (venlafaxine), "Protonix" (pantoprazole), "Procrit/Eprex" (erythropoietin), "Cozaar/Hyzaar" (losartan), and "Fosamax" (alendronate).

Recent plant closures

Despite these positive signs, Puerto Rico is facing facility rationalization by Big Pharma and the top generic-drug companies. During the past 18 months, five major drug-manufacturing plants have either closed or were announced to be closed in Puerto Rico. In 2007, Bristol-Myers Squibb (BMS, New York) announced that it will close its plant in Mayaguez, Puerto Rico, by the end of 2008. This closure is in addition to Bristol-Myers Squibb's December 2007 announcement that it plans to reduce the number of its manufacturing facilities by more than 50% by the end of 2010. As of press time, Bristol-Myers Squibb had not disclosed which facilities were to be closed. In addition to Mayaguez, BMS has manufacturing facilities in Barceloneta, Manati, and Humacao.

GlaxoSmithKline announced in October 2007 that it will close a plant in Cidra, Puerto Rico because of declining sales of its diabetes treatment "Avandia" (roseglitazone). The company is transferring production of Avandia and the related drug, Avandament (rosiglitazone and metformin), to other facilities.

In early 2007, Watson Pharmaceutical (Corona, CA) closed its solid-dosage manufacturing facility in Humacao as part of strategic move to rationalize manufacturing facilities in North America.

Teva Pharmaceutical Industries (Petach Tikva, Israel) and Schering-Plough (Kenilworth, NJ) closed facilities in Puerto Rico in 2006. As part of a strategy to create manufacturing centers of expertise, Teva closed five manufacturing facilities in North America, including its facility in Cidra. The move followed Teva's $7.9-billion acquisition of Ivax in early 2006. The Cidra facility was a former Ivax facility that had manufactured 50 products.

During 2006, Schering-Plough closed its manufacturing operations in Manati, Puerto Rico. It also reduced its workforce in Las Piedras, Puerto Rico, and New Jersey.

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