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Genzyme in the red amid more discarded drugs

Wed, 08/11/2010 - 5:37am
Mass High Tech: The Journal of New England Technology

Genzyme Corp. has discarded some batches of four of its drugs, the company disclosed in a regulatory filing, bringing the company to a net loss for the second quarter.

The Cambridge-based biotechnology company updated its second quarter earnings statement to reflect a $6.5 million charge associated with “additional inventories that did not meet our quality specifications”, the filing reads. This is in addition to a previously reported $21.9 million write off that consisted mostly of drugs that were dumped after a water system problem late in the first quarter at the Allston plant.

Second quarter earnings now reflect a net loss of $3.8 million, compared with net income of $23,000, reported on July 21, 2010.

The disclosure comes as Genzyme is in the process of reportedly negotiating an acquisition deal with French drug maker Sanofi-Aventis,   and some analysts say any further manufacturing troubles could hurt the price Genzyme is able to attract in the deal.

The company continues to work to resolve the ongoing manufacturing crisis that led to a temporary shutdown of the Allston plant last summer , and prompted a serious enforcement action by the U.S. Food and Drug Administration earlier this year.

 

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