Genzyme Temporarily Halts Production at Allston Plant

June 16, 2009 -- Genzyme Corporation (NASDAQ: GENZ) today announced that it has detected a virus that impairs cell growth in one of six bioreactors at its Allston Landing manufacturing facility. The company has decided to temporarily interrupt bulk production at the plant to sanitize the facility. Genzyme is collaborating with regulatory agencies as it works to resume production. The company expects the plant to be fully operational by the end of July.

The virus strain, Vesivirus 2117, has not been shown to cause human infection. It is known to interfere with the growth of CHO cells used to produce biologic drugs and was likely introduced through a nutrient used in the manufacturing process. Genzyme has now confirmed that this virus was the cause of declines in cell productivity at its Allston and Geel facilities in two previous instances in 2008, which were subsequently fully addressed. The company was able to detect the virus in this case using a highly specific assay it developed after standard tests were unable to identify the cause of the previous productivity declines. Genzyme is adding steps to increase the robustness of its raw materials screening and viral removal processes.

Current inventories for Cerezyme® (imiglucerase for injection) and Fabrazyme® (agalsidase beta) are not sufficient to meet projected global demand. The timing and extent of the Cerezyme supply constraint is being clarified and will be communicated as soon as possible. The company expects Fabrazyme supply constraints to occur for a limited period beginning in September. The company will work with physicians, patients and regulators to minimize the impact of this constraint.

“The patients who need these therapies are our priority,” said Henri A. Termeer, Genzyme’s chairman and chief executive officer. “We are confident in the quality of the products produced in Allston and in our ability to resolve the issue affecting the plant. The impact will be temporary.”

Genzyme identified the virus at the Allston plant over the weekend. On Monday morning, the company submitted information to the FDA and EMEA on its findings. The company held a conference call with the FDA on Monday afternoon. With regulatory input, Genzyme is finalizing its action plan and assessing the business impact of this situation. The company will provide updated financial guidance as soon as possible.

Source: Genzyme Corporation (NASDAQ: GENZ)