U.S. companies' Puerto Rico pharma, pesticide factories shut

Puerto Rico Hurricane Maria
People walk next to a gas station flooded and damaged by the impact of Hurricane Maria.

U.S. corporations have had to stop manufacturing operations in Puerto Rico, the U.S. Caribbean island colony, as emergency workers struggle to reestablish clean water, phone service, and electric power for the 3.5 million residents of the island wrecked by Hurricane Maria last Wednesday.

“Our sites are not operating at this time,” said Daniel Turner, a spokesman for the former DuPont Co. businesses of DowDuPont, which has facilities for its farm sales businesses in Salinas on the south coast and Manatí in the north, and an electronics and communications equipment plant, also in Manatí. The company is “working to support” its 440 workers on the island, who avoided injury, “during this difficult time, and are in the process of shipping generators, food, water, and other key supplies to the island.”

Puerto Rico is known especially as a drug manufacturing center. At least eight U.S. and two European pharma giants have plants around the island, according to the Pharmaceutical Industry Association of Puerto Rico. Food and Drug Administration commissioner Scott Gottlieb said last Friday  that his agency is “working closely with pharmaceutical and device companies with manufacturing sites in Puerto Rico to prevent shortages of medically necessary drugs and devices.”

The nation’s biggest drugmakers were drawn to Puerto Rico in part by federal and local tax breaks. Johnson & Johnson, which earns a billion dollars in after-tax profits every three weeks, had a negative tax liability (net credits) last year of $7.8 million, combined, from its facilities in Puerto Rico and in a second island tax haven, Ireland, according to the company’s annual report.

Johnson & Johnson representatives did not return calls on the status of at least seven J&J plants in Puerto Rico, including its McNeil Healthcare LLC plant in Las Piedras, on the eastern coast, which took over production of pharmaceuticals from the J&J McNeil plant in Fort Washington when it was closed from 2011 through 2015 for safety violations; and the Lifescan Products plant on the island’s west coast in Aguadilla, cited by Gov. Ricardo Rosselló as one of several towns where his government had been unable to reach anyone as of last weekend.

“We have a fantastic presence” in Puerto Rico, said Dominic J. Caruso, CFO of the New Jersey-based drug and medical equipment maker, in a conference call with investors Sept. 13, after Hurricanes Harvey and Irma had skirted the island, but before it took a direct hit from Maria. As of that date, Caruso said, he was more worried about Florida medical patients canceling elective surgery using J&J products and devices because of Irma damage there than about his company’s Puerto Rico plants.

At AstraZeneca, the island’s basic communications, road, and utility problems have kept all the company’s 250 Puerto Rico workers except a skeleton storm crew from reaching facilities, including the “critically important” Canóvanas plant east of San Juan, where the company makes the anticholesterol drug Crestor, said spokeswoman Alexandra Engel from the company’s U.S. headquarters in Fairfax, Del. “We are still in the process of formally assessing the site. However, we believe that given the magnitude of the storm, the facility fared well.”

“We remain committed to our facility in Puerto Rico,” and the company expects the facilities to reopen fully “as soon as it is appropriate.”

How soon will factories reopen? “Critical manufacturing areas” at the Amgen plant in Juncos were “not significantly” damaged by the storm, according to a preliminary assessment, said Esteban Santos, executive vice president for operations at the pioneering genetic therapy company, in a statement Monday.

But with the island power grid expected to be at least partly down past Christmas, Santos said, he will have to rely on backup generators to help hundreds of Amgen workers “return its operations in Puerto Rico to normal as quickly as possible.” Santos also said the company has backup production capacity at other plants off the island, plus inventory sufficient to meet patient demand. Amgen’s charitable foundation pledged $3 million to support Hurricane Maria relief efforts, plus $2 million for long-term rebuilding.

Merck, which has a plant in Las Piedras, is still evaluating the impact of the “unforeseen situation” on “continuity of supply of our medicines and vaccines,” spokeswoman Claire Gillespie said.