Allergan Finally Breaks Ground on $200 Million Texas Expansion, Facility to Up Headcount by 100
April 26, 2016
By Alex Keown, BioSpace.com Breaking News Staff
WACO, Texas – Allergan broke ground on a $200 million expansion of its facility in Waco, Texas, which is expected to bring up to an additional 250 jobs when the plant reaches full operation, the company announced Monday.
Allergan had initially announced plans for the expansion in February, following the planned merger with Pfizer , which has since fallen apart. The Waco expansion will add 322,000 square feet of manufacturing space to the current facility, nearly doubling its current footprint. The expansion is expected to upgrade and expand the company’s manufacturing capabilities and capacity. Allergan said it anticipates the Waco facility will be capable of producing more than 40 different product formulations and will increase its production capacity by more than 50 percent. The expansion is expected to be completed by 2020, Allergan said.
The Waco site is Allergan’s primary manufacturing facility for its eye-care products, including Restasis, Lumigan, Combigan, Refresh Plus, Refresh Tears and Latisse.
Brent Saunders, president and chief executive officer of Allergan, said the investment in the Waco site will “elevate our manufacturing capabilities and increase our ability to provide more complex medicines to more physicians and their patients around the globe.”
The plant currently conducts operations 24 hours per day, seven days a week. The plant, which opened in 1989, currently employs 750. The plant is currently undergoing a $7.5 million renovation of the first and second floors and to install new processing equipment to make packaging. Allergan said the expansion will add 100 full-time jobs, but there is a potential for 250 jobs when the expansion has been fully completed. Anticipated jobs include chemists, microbiologists, process engineers and production and maintenance technicians, Allergan said in a statement.
The Waco plant has a major economic impact on the central Texas economy, according to a Baylor University study released by Allergan on Jan. 29. According to the research, the Waco plant “generated a combined economic impact on Waco area income of $263 million and an aggregate impact on total spending of $406 million in the Central Texas economy in 2015.”
Tom Kelly, a professor of economics at Baylor, said the new expansion will add an additional $380 million to the Central Texas economy during the construction period. Additionally, Kelly said during the first year of construction the total economic impact of Allergan capital investment plus operations on the Central Texas economy is projected to increase to $522.3 million from a previously projected $450.3 million in 2016.
The expansion of the Waco site comes on the heels of the collapse of the Pfizer deal, which fell apart following new U.S. Treasury regulations regarding tax inversions, which would have allowed Pfizer to shift its headquarters to Ireland, Allergan’s home-based, to reduce its tax rate. Allergan received a $150 million breakup fee after the deal was terminated, but it has also pulled in $40 billion from its sale of its generics business to Israel-based TEVA .
After the deal with Pfizer fell through, Allergan did not wait long before exercising its M&A muscle. Last week Allergan, best known as the maker of Botox, acquired Boston-based Topokine Therapeutics and its lead product XAF5, a first-in-class topical agent to treat steatoblepharon, more commonly known as bags under the eyes. One day after the Pfizer deal fell through, Allergan entered into an agreement with Heptares Therapeutics for exclusive global rights to a portfolio of novel subtype-selective muscarinic receptor agonists for the treatment of several neurological disorders, including Alzheimer’s disease.