Recipharm announces that it will continue the manufacturing operations at its facility in Höganäs, Sweden, operations that earlier were set towards being discontinued.
In 2017, Recipharm announced the intention to discontinue the operations in Höganäs and evaluate different options for the facility, including divestment of the site. During this evaluation, new customers have actively approached Recipharm, adding demand for several new products in Höganäs. Consequently, Recipharm is now reversing the decision to discontinue the operations in order to progress these new opportunities.
An important new customer contract
At this stage, an important new customer contract has now been established, comprising development and launch of a new product by a large European pharmaceutical company. Recipharm expects that today’s decision will facilitate the completion of further customer agreements, as well as extending relationships with already existing customers.
“The decision to stay in Höganäs is a consequence of the increased demand for the technology and capacity we can offer. This has been somewhat unexpected, but we are of course pleased to see new customers entering in Höganäs and that we by this also are able to continue the services to existing customers,” says Thomas Eldered, CEO of Recipharm. “We expect to see volume growth already in 2019 and it will allow Recipharm to continue to offer an extensive and competitive manufacturing structure for powders and granules. I am also glad that our highly skilled workforce will have continued employment with Recipharm. They have shown a high level of commitment during this period.”
Recipharm’s operations in Höganäs employ approximately 45 people and are specialised in sachet and stick pack filling, primarily for powders and granules.
The decision to continue the Höganäs operations will trigger release of the associated accrual for estimated closing costs. This will lead to a minor non-recurring income that will be reported in the Q3 2018 results.