Bristol-Myers Sets Sites on Devens Approval

Drugmaker Seeks FDA Endorsement to Bring Production to New Plant

February 21, 2010 : Worcester Telegram & Gazette, by Lisa Eckelbecker

DEVENS — Nearly four years after announcing plans to build a drug manufacturing center in Massachusetts, Bristol-Myers Squibb Co. is into the final phase of work before regulators approve the plant for commercial production.

The company completed construction of a five-building complex covering more than 300,000 square feet of space late last year and is now working to win Food and Drug Administration approval of the center, said Christopher R. Perley, Bristol-Myers Squibb vice president and general manager of the Devens facility.

“We're done with construction,” Mr. Perley said. “It's a big milestone for us.”

It's a milestone for the state, too. Massachusetts legislators pumped up to $34 million into the Massachusetts Development Finance Agency, or MassDevelopment, for infrastructure improvements and a capital fund at the former Army base off Route 2 to snare Bristol-Myers. The state also awarded tax credits to Bristol-Myers that hinged on the company spending at least $650 million and creating at least 550 direct and contracted jobs. Total incentives to Bristol-Myers were estimated at about $60 million.

At Devens, the state's share of work is nearing an end. Construction of a wastewater pretreatment plant and improvements to natural gas lines, an electric substation and well infrastructure is either done or finishing up, according to Meg Delorier, MassDevelopment chief of staff.

“Portions of it are being finalized, but it's all on time,” she said.

When Bristol-Myers set out to find a site for a new biologics plant, it considered multiple U.S. locations. At first, the process was cloaked in secrecy. Massachusetts officials called it “Project Hummingbird” and did not even know the identity of the company seeking information.

Construction of the Bristol-Myers plant, a project estimated by the company at $750 million, began in 2007 on an 89-acre site off Jackson Road. It was the same year Bristol-Myers set out on its “string of pearls” strategy to expand its biopharmaceutical business by acquiring biologic compounds, entire lines of products or companies.

Bristol-Myers' rheumatoid arthritis treatment Orencia, which brought in $602 million in 2009, or about 3.2 percent of all sales, will be the first drug produced at the Devens plant. Bristol-Myers is also developing a kidney transplant drug called belatacept, or Nulogix, that could be produced at Devens if it wins approval from regulators. The company's pipeline includes other biologics under development as possible cancer treatments.

“We have quite a number of biologicals in clinical trials, some in advanced stages of clinical trials in the area of oncology,” Mr. Perley said. “Should those be proven to be safe and efficacious, they will be coming here as well.”

Bristol-Myers is betting big on biologics, not just with its Devens plants, but with its “pearls” strategy. In August, the company completed a $2.4 billion acquisition of Medarex Inc. of Princeton, N.J., a developer of antibody-based treatments for cancer.

Finding and developing new drugs is crucial because several of Bristol-Myers' biggest products, including the blockbuster cardiovascular drug Plavix, will lose patent protection and face generic competitors between 2011 and 2013, and the company is already planning to make $2.5 billion in annual cost cuts by 2012.

“Bristol's pipeline becomes even a bigger safety net for the company as it faces a plethora of patent losses over the next few years,” Morningstar senior stock analyst Damien Conover wrote in a note to clients on Jan. 28.

The first phase of work at Devens includes a manufacturing building, a laboratory and office building and a warehouse. The office and laboratory building has been awarded LEED “gold” status by the U.S. Green Building Council, the second highest designation for buildings constructed with sustainable, energy-efficient designs.

All production equipment, much of it custom-made and highly automated, has been installed. Six large bioreactors, each with a capacity of 25,000 liters, are in place, and workers are testing systems in an effort to obtain Food and Drug Administration approval of the facility, according to Mr. Perley. The company is currently producing Orencia for sale at a facility in Syracuse, N.Y., that focuses on smaller-scale production. Once the FDA approves the Devens plant, Orencia made there may be sold.

“We're expecting our approval from the FDA in 2011,” Mr. Perley said. “As part of the FDA approval process, you have to produce some batches of the product. … You're basically proving that the Orencia made in this plant is the same as the Orencia made in Syracuse.”

The plant, which will produce large quantities of biological material that will be shipped elsewhere for packaging, is just one of several new or expanding biotechnology manufacturing plants under development in Massachusetts. Genzyme Corp. of Cambridge is completing a 70,000-square-foot cell culture plant in Framingham. Organogenesis Inc. of Canton has plans to expand manufacturing in Canton. Shire Plc is building a 250,000-square-foot biomanufacturing facility in Lexington.

Peter Lowitt, director of the Devens Enterprise Commission, said Bristol-Myers' plant at Devens has received permanent occupancy permits for most buildings while the manufacturing building has received a temporary occupancy permit as some minor interior work continues. The permitting has required extensive scrutiny because the facility is so large, he said.

“Our plumbing inspector has spent a large portion of his time permitting that place. You have to be able to follow every single pipe chase from beginning to end to do that,” Mr. Lowitt said.

Bristol-Myers officials said in 2006 that one element drawing them to Devens was the region's work forces, and the company currently employs about 250 people at the plant. Officials expect to hire about 30 more workers this year. Additional workers could be hired if production expands, but that will depend on product sales, Mr. Perley said.

“We think our phase one, as we call it, will probably max out at about 350 employees,” Mr. Perley said. “It depends on how the production does and how much we sell.”

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