Genzyme Expands Manufacturing Deal With Hospira

July 8, 2010

Biotechnology company Genzyme Corp. said Wednesday it expanded a manufacturing deal with Hospira Inc., which will now make seven Genzyme drugs over the next five years.

Hospira will handle fill and finish manufacturing services for Genzyme drugs Cerezyme, Fabrazyme, Myozyme, Lumizyme, Thyrogen, Thymoglobulin, and Campath, plus some drug candidates. The deal was disclosed in a filing with the Securities and Exchange Commission.

The agreement will expire on June 30, 2015, or at the end of the last order the companies agreed on -- whichever comes later. The agreement will automatically be renewed for one-year terms unless one company gives at least two years' notice to the other.

In late December, the companies reached a similar agreement that covered only Cerezyme, Fabrazyme, Myozyme and Thyrogen. That deal was scheduled to end on Dec. 31, 2015, and had options for a two-year extension.

Genzyme has been dealing with manufacturing problems, including viral contamination at a manufacturing plant and tiny particles of trash in its drugs, for more than a year. The problems have cost Genzyme millions of dollars in revenue, and in May it agreed to return $175 million in "unlawful profits" from sales of drugs made at its Allston, Mass., facility.

The company also agreed to fix problems at the Allston plant and move operations for filling drug vials to a new plant.

In aftermarket trading, Genzyme stock rose 15 cents to $52.30. Shares of the Cambridge, Mass., company rose 2 percent to $52.15 during the day.

Shares of Hospira, which is based in Lake Forest, Ill., were unchanged at $58.82 aftermarket. During the day they rose 1.2 percent, and set an annual high of $58.90.