Pharmaceutical company consolidating U.S. operations to one campus
BOULDER, Colo. — OSI Pharmaceuticals Inc. is closing its 145-employee Boulder office as part of plans to consolidate its U.S. operations to a single campus in New York, officials announced this week.
Officials for the Melville, N.Y.-based drugmaker said the consolidation — which will affect 350 people who work in Melville; Farmingdale, N.Y.; Boulder; and Cedar Knolls, N.J. — is intended to “simplify” its business operations.
“The past 10 years has been a remarkable journey as the company has successfully brought its first oncology product, Tarceva to market and taken the business profitable,” Colin Goddard, OSI’s chief executive, said in a news release. “Nonetheless, we have recognized that we will only truly capture the full strategic value of our oncology franchise if we simplify our business by bringing together all the elements of our U.S. operations onto a single site.”
OSI’s diabetes and obesity franchise in Oxford, England, will remain operational.
About 145 people work at OSI’s Boulder office, according to employment information recently provided to the Camera. OSI has yet to file a notice with Colorado’s labor department under the Worker Adjustment and Retraining Notification Act, said Bill Thoennes, a spokesman for the Colorado Department of Labor and Employment.
The local employees will be offered relocation packages to work in New York, OSI officials said.
OSI recently purchased a 43-acre site that includes 400,000 square feet of existing office space in the village of Ardsley, N.Y., for $27 million and expects to begin the consolidation later this year, officials said in a news release. The company received incentives from the state of New York in connection with the move to Ardsley, about 20 miles north of Manhattan, OSI officials added.
OSI (Nasdaq: OSIP, $27.88) expects to save more than $15 million a year when the consolidation is completed during the fourth quarter of 2010.
“We recognize that this decision has a significant impact on the lives of our employees, in particular, the employees in our Boulder office. All employees will be offered a position at the Ardsley, NY facility and we hope that as many people as possible will join us as we embark on a new and exciting phase for the Company,” according to an e-mailed statement attributed to Goddard.
“For those who choose not to stay with OSI after the Westchester (County) relocation or who are unable to do so, the company will offer a severance package.”
OSI did not disclose the details of the severance packages.
OSI has had a presence in Boulder since 2001, when it purchased Gilead’s Boulder offices and a pipeline of cancer-fighting clinical candidates for $200 million. Gilead acquired the operations two years earlier in its merger with the Boulder-bred NeXstar Pharmaceuticals Inc.
Local entrepreneur Larry Gold, now the CEO of Boulder-based SomaLogic, founded NeXstar.
OSI’s departure will have a near-term impact on Boulder, but should not have a lasting negative effect on the area’s biopharmaceutical industry, said Frances Draper, executive director of the Boulder Economic Council. While the area is losing a number of higher-paying jobs, she said she feels encouraged by the presence of other biotechnology firms and new technologies and companies coming out of the University of Colorado.
“I think it’s actually probably pretty unfortunate for OSI because here they could access a pretty good pool of employees,” she said.
There are about 16,000 people employed in the 380-company bioscience field in Colorado, according to the Colorado BioScience Association. The average employee salary in that field is $63,000, the association said.
John Collar, president and CEO of the Colorado BioScience Association, said OSI’s departure from the state does cause concern, but he echoed Draper’s comments about bioscience’s strength in Colorado.
“I think, overall, the folks will be in pretty good shape going forward,” he said.
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