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Merck sells Colorado biologics plant to KBI

Published on 18/05/14 at 12:28pm

Merck & Co has swung the axe over its M&P operations again – this time for its biologics plant in Boulder, which just five years ago it purchased for $130 million.

This rounds off a tough time for Merck’s manufacturing as the US firm has now closed or sold a number of operations as part of its most recent restructuring to find $2.5 billion in savings.

KBI Biopharma, which is based in Research Triangle Park in North Carolina, says that it has now closed the deal to buy the plant.

The contract manufacturer (CMO) will maintain some drug development and manufacturing of Merck products from the facility, as well as doing work for Merck at its facilities in North Carolina, it says.

KBI will also use the Boulder facility to do projects for other clients, allowing it to provide microbial development and manufacturing up to a scale of 1500L.

Lainie Keller, director of global communications at Merck, says the 30 employees of the plant were taken on by KBI. She adds that the facility has been providing analytical and technical support for Merck’s biologics pipeline and produces Recombinant Trypsin (R-Trypsin), which is used in the manufacture of vaccines and other biologics.

KBI has plans to build production at the facility and last month was granted $1.4 million in state incentives in exchange for bringing 120 jobs to Boulder, according to the Boulder County Business Report.

“We are very pleased to continue to advance our partnership with Merck, and to welcome this very highly regarded team of scientists in Boulder to the KBI team,” KBI’s chief executive Joe McMahon says in a statement.

Terms of the deal were not disclosed but Merck bought the Boulder plant in 2009 from Ismed for $130 million.

This all forms part of a larger plan for Merck to cut back costs as patent expiries continue to take chunks out of it revenue.

In 2011, Merck sold its BioManufacturing Network and its biologics plants in North Carolina and Northeast England to Japan’s Fujifilm for $490 million, which was looking for a way to get into biologics manufacturing.

And last year Merck sold off some active pharmaceutical ingredient operations in the Netherlands and US to Aspen Pharma in a $1 billion deal that also included Aspen buying 11 products from Merck.

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