Mallinckrodt will Expand Hobart, NY Facility

Mallinckrodt Inc. (St. Louis) has announced plans to expand and upgrade its Hobart, NY dosage (as opposed to bulk) pharmaceutical plant to the tune of $11.8 million. The Hobart facility, formerly Graham Laboratories, is expected to become the sole manufacturing and distribution base for Mallinckrodt's worldwide dosage pharmaceuticals business.

"In a constantly changing market, Mallinckrodt must grow to compete," said Michael J. Collins, president of Mallinckrodt's Pharmaceuticals Group. "By bringing our entire dosage business to Hobart, we expect to streamline our operations and eliminate inefficiencies." Currently, the company's St. Louis plant distributes all dosage pharmaceuticals products. Construction of the new Hobart facilities will begin in March 2000 and extend over an 18-month period.

The plan calls for the construction of a 40,000-square-foot dosage pharmaceuticals distribution center and a 45,000-square-foot packaging plant. Both facilities will support existing products and will provide a platform for new Mallinckrodt dosage products. The new distribution center and increased packaging capacity will enable Mallinckrodt to bring greater strategic focus to its dosage business and to better integrate manufacturing, packaging and distribution operations. The company plans to hire an as-yet-undisclosed number of new employees to staff the new distribution and packaging sites.

Mallinkrodt acquired the former D.M. Graham Laboratories in Hobart, New York, in November 1996. Hobart manufactures Mallinckrodt's pharmaceutical oral solid-dose and liquid products and provides third-party contract manufacturing and clinical trial materials. The 155,000 square foot Hobart site, which includes a new 64,000 sq.ft. manufacturing plant, boasts a technical staff of more than 250 employees.

More of a Good Thing
Mallinkrodt's expertise as a bulk pharmaceutical manufacturer and active ingredient supplier goes back 100 years. About seven months ago, in a sharp break with its past, Mallinkrodt introduced Methylin, its own generic brand of methylphenidate ("Ritalin"), the popular treatment for attention deficit disorder. Four months after hitting the market, Methylin's sales far exceeded Mallinkrodt's projections, and are expected to double during Mallinkrodt's current fiscal year.

Based on the success of Methylin and its existing competence in bulk active manufacture, Mallinkrodt is expanding its dosage business. The next products will probably be generic oxycodone and hydrocodone analgesics. "This is a natural move for Mallinkrodt," said company spokeswoman Barbara Abbett, "since we're already the worlds leading supplier of acetaminophen," the popular OTC analgesic commonly formulated with narcotic actives to produce oxycodone and hydrocodone. Manufactured at Mallinkrodt's Raleigh, NC plant, acetaminophen is supplied to major OTC manufacturers and sold under popular brand names. "A great deal of work will be done at Hobart [on these products] as the expansion comes online," Abbett added.

Mallinkrodt's 1999 sales of $2.6 billion were split among three product groups: pharmaceuticals ($650 million), respiratory (critical care ventilators, tracheal tubes for anesthesia; $1.1 billion), and diagnostic imaging (contrast media for x-ray, magnetic resonance, radiopharmaceutical imaging; $850 million).

For more information: Barbara Abbett, VP, Mallinkrodt, Inc., 675 McDonnel Blvd., PO Box 5840, St. Louis, MO 63134. Tel: 314-654-5230. Fax: 314-654-5381.

By Angelo DePalma