Sun Pharma says the closure of a Michigan plant employing 179 staff is necessary in order to consolidate its US manufacturing network, and not related to its Ranbaxy acquisition.
The pharma generics firm issued a Worker Adjustment and Retraining Notification Act (WARN) Wednesday, informing the Workforce Development Agency for the State of Michigan that it intends to cease manufacturing on or around June 30 this year at a Detroit facility, operated by its fully-owned subsidiary Caraco Pharmaceutical Laboratories.
According to the WARN , 179 jobs will be affected by the closure including over 60 manufacturing and packaging positions, and over 60 roles involved in quality assurance and control.
“The decision to close down the Detroit facility is driven by business considerations,” Sun Pharma spokesman Frederick Castro told in-Pharmatechnologist.com. “Our capacity in USA is considerably large and it has become essential to consolidate our manufacturing in line with the market requirements.”
The Caraco facility manufactures six finished pharmaceutical products, he continued, adding the firm has “undertaken necessary measures to ensure business continuity of these products by transferring the production of these drugs to [its] other units.”
Further product details could not be divulged, but according to its website Caraco develops, markets and distributes generic pharmaceuticals to the wholesalers, distributors, and drug store chains in the US.
Sun Pharma is currently finalising a $3.2bn acquisition of fellow Indian drugmaker Ranbaxy and has previously told this publication synergies from the merger would not initially come from the manufacturing side.
“The decision to close the Detroit unit is not at all linked to the Ranbaxy transaction,” Castro said, when asked whether Sun Pharma was reneging on its merger strategy.
Caraco was subject to regulatory sanctions in 2009 when continued violations of cGMP led to the US Food and Drug Administration (FDA) ordering the seizure of products from three Michigan facilities, including the condemned Detroit plant. The firm entered into a Consent Decree with the FDA several months later.