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Shire shifts vaccine facility from Baxalta deal to MSD

Published on 08/08/17 at 09:35am

As part of Shire’s mega-merger with Baxalta, it suddenly had a massive manufacturing network that spanned 17 sites across seven countries. It was inevitable that the company had to consolidate or sell off some of these sites to make it a more manageable prospect.

It continued this process by selling its Austria-based vaccine plant to MSD for an undisclosed fee. The 340,000-square-foot facility holds the capability to manufacture vaccines and had been used as a storage facility for another part of its vaccine manufacturing network in Austria.

MSD announced that it plans to use the plant, located in Krems an der Donau, as part of its plans to expand the manufacturing capabilities of its Animal Health unit. The site had been shut down in October 2016, not long after the Shire-Baxalta deal was completed.

For Shire, it represents the attempt to trim down the excess from its $32 billion deal that has already shown strong benefits in recent financials.

Shire announced, in second quarter results, that revealed sales were up 55% compared to the same period last year. CEO Flemming Ornskov also revealed that the company was ahead of schedule to deliver $700 million in cost synergies in the three-year period after the completion of the deal. This further divestment of a vaccine site leftover from the deal will only help this process.

For MSD Animal Health, it represents a facility set in the centre of Europe that aims to meet growing demand for its products.

“We are excited to expand our footprint to Krems,” stated Dr. Hans-Günther Dittrich, Vice President, Europe, Russia, North Africa, Middle East region. “Krems is the home to several distinct universities, and a rich tradition as an economic centre for bio-pharmaceuticals. It is a great opportunity for us to tap into the innovative science in the area.”

MSD announced that it plans to renovate the facility immediately but did not pin down a date when it plans to have the facility operational again, only referring to the prospect “in the coming years”.

Ben Hargreaves

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