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APP Project Gets $1.2 Million in Tax Credits

Grand Island Pharmaceutical Plant Expanding

By David Robinson
June 16, 2011

APP Pharmaceuticals’ planned expansion of its Grand Island plant is getting nearly $1.2 million in tax credits over a five-year period through the state’s main economic development incentive program.

The tax credits, awarded through the state’s Excelsior Jobs Program, are part of a broader package of incentives, including property tax breaks and low-cost hydropower, that are aiding APP’s plan to build a 13,000-square-foot addition to its Staley Road plant.

The expansion will add six new production lines for generic injectable products at the 37,000-square-foot Grand Island plant, which is picking up work from facilities in Illinois and one that is closing in Puerto Rico.

The Grand Island plant makes injectable products used to treat infections and in cancer treatments, as well as for critical care, anesthesia and analgesia purposes. Company officials said they expect the demand for generic injectables to grow steadily.

“The investment in this facility is an important step within our production strategy,” said Dr. Michael Schonhofen, the president of science, production and technology for APP’s German parent company, Fresenius Kabi Pharmaceuticals.

“Through the expansion, the site will significantly contribute to the con-

tinuous local supply of high-quality injectable generics for the U. S. and Canada,” he said in a statement.

The project is expected to create 90 jobs at the Grand Island plant, which currently employs 580 workers.

The company placed the value of the project at $38 million. That’s more than the $28 million estimate APP provided earlier this month to the Erie County Industrial Development Agency, which is expected to vote on tax breaks for the project Monday. And it’s more than the $30 million estimate APP provided in April to the New York Power Authority, which has granted the project 2,000 kilowatts of low-cost electricity.

A spokeswoman at APP’s suburban Chicago headquarters said the project’s value has increased as the plans for the expansion have been finalized.

The project is expected to begin later this month and take two years to complete.

The 41-year-old APP plant has been expanded several times since it opened, most recently in 2005, when the company expanded the production capabilities for oncology products, as well as its aseptic filling and packaging abilities.

drobinson@buffnews.com