The Economy

Drug Company Opens New Manufacturing Plant in Puerto Rico

April 14, 2010

Facility will help meet U.S. government demand for anthrax antidote and other medicines.

Blu Pharmaceuticals LLC, a Franklin, Ky.-based generic pharmaceutical company, opened a new manufacturing facility in Dorado, Puerto Rico, this week to help meet demand for medicines it will supply to the U.S. government.

The company is expected to invest $60 million in the facility during the next three years and employ nearly 250 people at the facility, which will be known as Blu Caribe Inc., according to the company.

Blu Pharmaceuticals acquired a 145,000-square-foot FDA-approved facility previously owned by Biovail Corp., which announced in May 2008 that it would be phasing out its solid dosage manufacturing facility in Dorado. The company was able to retain former Biovail employees, including key plant management. About 170 retained employees and new hires are working at the plant, according to Blu Pharmaceuticals.

The stars aligned for us in Puerto Rico, said Bill Luster, president of Blu Pharmaceuticals. We were able to acquire a state-of-the-art manufacturing facility for pennies on the dollar of what it would have cost for us to build an operation from the ground-up, plus we were able to tap into a highly talented work force. We have been able to transfer technology successfully to Puerto Rico in just three months, where it may have taken nine months elsewhere.

Plans call for Blu Caribe to manufacture seven different drugs in the Puerto Rico facility, including ciprofloxacin, the antidote to anthrax. The company also has plans to establish an R&D operation within the Dorado facility, which has a pilot plant that will allow the company to run small batches of product under development, according to Blu Pharmaceuticals.

Incentives Included $10 Million in Financing

The Economic Development Bank for Puerto Rico and the U.S. Small Business Administration (SBA) provided financing for the $10 million acquisition of the manufacturing plant and equipment. In addition, the Puerto Rico Industrial Development Co. (PRIDCO) provided economic incentives to help attract the company, which considered numerous sites in the United States and South America during the past 18 months.

The company also gained other tax incentives through a sweeping set of new business attraction inducements recently passed in Puerto Rico.

In todays tough financing environment, it made a big difference that the Puerto Rican government was willing to partner with us to help finance the project, Luster said. The Economic Development Bank, SBA and PRIDCO were outstanding in terms of their due diligence and level of support that made this project possible.

About the Author

Josh Cable | Former Senior Editor

Former Senior Editor Josh Cable covered innovation issues -- including trends and best practices in R&D, process improvement and product development. He also reported on the best practices of the most successful companies and executives in the world of transportation manufacturing, which encompasses the aerospace, automotive, rail and shipbuilding sectors.

Josh also led the IndustryWeek Manufacturing Hall of Fame, IW’s annual tribute to the most influential executives and thought leaders in U.S. manufacturing history.

Before joining IndustryWeek, Josh was the editor-in-chief of Penton Media’s Government Product News and Government Procurement. He also was an award-winning beat reporter for several small newspapers in Northeast Ohio.

Josh received his BFA in creative writing from Bowling Green University, and continued his professional development through course-work at Ohio University and Cuyahoga Community College.

A lifelong resident of the Buckeye State, Josh currently lives in the Tremont neighborhood of Cleveland. When the weather cooperates, you’ll find him riding his bike to work, exercising his green thumb in the backyard or playing ultimate Frisbee.