$175m fine for Genzyme after Allston troubles

By Gareth Macdonald

- Last updated on GMT

Related tags: Manufacturing

US biotech Genzyme will pay $175m and cease some manufacturing operations at its facility in Allston, Massachusetts under final terms of Food and Drug Administration (FDA) consent decree.

The news follows a year of manufacturing and quality problems at plant, which began with the discovery of viral​ contamination that forced Genzyme to temporarily halt production of several of its key products.

This resulted in the significant shortages, notably of the Gaucher’s disease treatment Cerezyme, which was the only approved treatment option available at the time.

More recently​, steel and rubber fragments were found in batches of Cerezyme, Fabrazyme Myozyme, Aldurazyme made at the plant, although on that occasion the FDA permitted manufacture to continue to prevent further shortages.

Under the FDA consent decree, which was flagged up in March​, Genzyme can continue to ship certain drugs made in Allston, but it is required to pay “an up-front disgorgement of past profits of $175 million.”

The agency also ordered Genzyme to move fill and finish operations for Cerezyme, Fabrazyme and Thyrogen away from the plant by December, for products sold in the US, and by August 2011, for those sold overseas.

If Genzyme fails to make the transfer by the allotted deadlines “the FDA can require [it] to disgorge 18.5 per cent of revenue for these products​,” which is significant given that they generate the vast majority of its earnings.

In response, the firm said it: “announced plans to transfer all fill/finish activities from Allston to other locations​,” adding it recently expanded capacity at its facility in Waterford, Ireland with just that aim in mind.

Genzyme also said that the remediation plan it submitted to the FDA in October, which covers actions to improve the quality of manufacturing operations at Allston, will be redrafted and resubmitted to the agency in light of the consent decree.

It added that, if cleared by the FDA, the plan will take between two and three years to fully implement after which time, if the problems persist, it will be liable to pay daily fines.

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