Lonza to close Riverside API plant

By Gareth Macdonald

- Last updated on GMT

Related tags: Molecule, Active ingredient, Lonza

Lonza will shut down its API plant in Riverside, Pennsylvania, US by the end of the year as part of a plan to cut costs and shift small-molecule production to Asia.

Operations at Riverside, as well as those at a vitamin K3 production facility in Shawinigan, Canada and a sales office in Wokingham in the UK, will cease by Q4 2010 under the Swiss firm’s “Project Bond​” cost cutting programme.

In a press statement, Lonza said it is “in contact with all Riverside customers to offer tailored solutions that will strengthen the supply security of their individual drug substances by transferring the projects into other operations within Lonza’s global network​.”

Spokesman Dominik Werner told in-PharmaTechnologist that active pharmaceutical ingredient (API) production currently carried out in Riverside will be transferred to "other operations within Lonza's global network​," including its facilities in Visp, Switzerland and Nansha, China.

Werner also said that the while the Riverside closure will bring an end to Lonza's production of chemical APIs in the US, the firm will continue its biopharmaceutical operations in Portsmouth and Hopkinton, New Hampshire.

He also said that nothing has been decided regarding any future sale of the Riverside facility and that "all options remain open​."

Operations in Wokingham will be transferred to a facility in Verviers, Belgium which already manages a significant proportion of Lonza's European supply chain.

CEO Stefan Borgas said the closures, which will affect 175 employees and cost CHF140m (€94.5m), will increase the firm’s competitiveness and are “a key element in our endeavour to bring Lonza back to a sustainable growth".

We will continue to drive this project throughout the year and we will see many initiatives rising from it. We are confident that we are on the right track and that the identified measures support the Lonza strategy​."

Carla Baenziger, analyst from Swiss bank Vontobel, told Reuters ​that: "The closure of Riverside shows that Lonza is feeling the first signs of the upcoming patent cliff in the small molecule market​."

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