Boehringer pulls plug on CMO biz, plots 1,100 job cuts

After years of regulatory woes and drug shortages, Boehringer Ingelheim is calling it quits for Ben Venue, planning to shut down its contract manufacturing arm by year's end and lay off about 1,100 workers.

Ben Venue has long been beset by quality control problems, culminating in a 2011 voluntary shutdown of the Bedford, OH, plant. Now, despite ongoing cuts and a compromise with the FDA, Boehringer said it just can't afford to keep the troubled plant open. It would cost about $700 million over 5 years to get the aging facility up to snuff, the company said, and, coupled with the more than $350 million invested to date, that doesn't fit Boehringer's balance sheet.

Starting this month, Ben Venue will start shedding workers in phased-reduction plan, halting production by New Year's and wrapping up the whole process at some point in 2014.

It's been a slow, colorful trip to oblivion for Ben Venue: In the run-up to 2011's shutdown, inspectors found a 10-gallon container of urine, presumably used by employees to eliminate the need for restroom breaks. And, because of the CMO's big-name client list, interruptions in production meant shortages of important drugs like Johnson & Johnson's ($JNJ) cancer treatment Doxil and therapies from Pfizer ($PFE), Takeda and Bristol-Myers Squibb ($BMY).

In an effort to ensure quality while maintaining supply, the FDA struck up a fairly lenient consent decree with Ben Venue this year, allowing it to keep manufacturing some drugs essential to patient safety. But Boehringer still struggled to keep the old plant afloat, announcing in August that it would cut up to 400 jobs at Ben Venue and focus on its newer facilities.

Now, with the facility to soon to close for good, Boehringer said it's looking for strategic alternatives for Bedford Laboratories, Ben Venue's generic sterile injectables business.

- read the announcement
- check out FiercePharmaManufacturing's take

Editor's note: An earlier version of this story misstated the nature of Ben Venue's 2011 shutdown. We regret the error.

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