AstraZeneca PLC Puts 'For Sale' Sign on U.S. HQ
August 26, 2016
By Mark Terry, BioSpace.com Breaking News Staff
UK-based AstraZeneca has placed its U.S. headquarters located in Fairfax, Delaware, up for sale. However, the company indicates that it is evaluating several options for the site, including redevelopment, and shouldn’t be viewed as abandoning Delaware or even the Fairfax area.
As reported earlier this week, Pfizer is buying AstraZeneca’s antibiotics business for more than $1.5 billion. AstraZeneca employs about 2,100 staffers in Delaware spread across a packaging facility in Newark and the Fairfax campus. It also has a much lower number of employees at AstraZeneca facilities in Boston and Gaithersburg, Maryland, who are involved in the antibiotics operations.
In July, in its second-quarter reporting, AstraZeneca noted a net loss of $3 million and a 22 percent drop in earnings. This is largely due to generic competition for some of its blockbuster drugs, such as cholesterol therapeutic Crestor, that have lost patent protection.
AstraZeneca is also working to focus on its core platforms of respiratory, cancer and diabetes drugs. Those areas grew 8 percent in the 2016 second quarter compared to the same period last year, hitting $3.7 billion.
In addition, AstraZeneca is working on cost-cutting measures, including slashing jobs. In May it indicated it planned to cut jobs in order to take $1 billion out of its budget by the end of 2017. Specifics were not announced, although it shortly afterward ended its relationship with 1,600 contractual sales representatives.
Sources told Delaware Online that AstraZeneca is hoping to sell the Fairfax campus and then lease it back from the new owners. One thing that does, in the short term, is show a profit to investors.
“In order to fully explore this [redevelopment] possibility,” Abigail Bozrath, an AstraZeneca spokeswoman told Delaware Online, “AstraZeneca will be soliciting bids from real estate developers in the coming months and that requires us putting the site on the market for sale.”
The real estate listing is being handled by JLL, which formerly operated as Jones Lang LaSalle.
Earlier this year, various interested parties, notably New Castle County Executive Tom Gordon, stated their belief that AstraZeneca needed to renovate the site because it was going to close an office somewhere else in the country and move those workers to Delaware. Although no specifics have been stated, speculation has focused on AstraZeneca’s facilities in Fort Washington, Pennsylvania.
AstraZeneca has indicated it is committed to keeping its U.S. headquarters in Delaware. Bozrath said in a statement, “This is a continuation of the evaluations currently underway, and we remain committed to keeping our North American commercial headquarters in Delaware. “AstraZeneca will be soliciting bids from real estate developers in the coming months, and that requires us putting the site on the market for sale.”
The Delaware location has been a big part of AstraZeneca’s operations in the U.S., but not without its own turmoil. In 2015, the company cut about 1,200 positions in Wilmington, mostly in research and development, and late-stage development. As recently as 2005, AstraZeneca employed 5,000 people at the Fairfax campus.