Pink Sheet is part of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC’s registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call +44 (0) 20 3377 3183

Printed By

UsernamePublicRestriction
UsernamePublicRestriction

WHITEHALL’s ELKHART PLANT CLOSING ELICITS SEC. 936 ATTACK

Executive Summary

WHITEHALL's ELKHART PLANT CLOSING ELICITS SEC. 936 ATTACK from Rep. Hiler (R-Ind.) in the form of a tax credit repeal bill (HR 4831) with the title, "American Jobs Stability Act of 1990." The bill would cancel Puerto Rican investment tax credits when a corporation eliminates operations in the U.S. to move them to the island. Although enactment of the bill is unlikely this year, the legislation has 28 cosponsors, including several senior GOP congressmen such as Rep. Madigan (Ill.) and Rep. Conte (Mass.). The announcement of the plant closing by the American Home Products' subsidiary on Sept. 7 precipitated a demonstration at AHP's corporate headquarters in New York on Oct. 3. Employees from the Elkhart facility joined members of the Oil, Chemical and Atomic Workers Union at the demonstration. The Company said the Indiana plant closing, to take place over the next 13 months, ultimately will affect more than 150 employees. The publicity surrounding the Whitehall plant comes on top of a squabble between Glaxo and SmithKline Beecham on Capitol Hill about the size of their tax breaks for Zantac and Tagamet production. SmithKline started that dispute by trying to block the suspension of an import duty for ranitidine. In countering SmithKline's arguments, Glaxo expanded the issue to Sec. 936 credits by comparing its suspension request to the Puerto Rican tax credit program ("The Pink Sheet" Oct. 1, T&G-4). That type of publicity on Capitol Hill -- job shifting allegations and finger-pointing over whose tax break is bigger -- could make Sec. 936 harder for the drug industry to protect in future years. The tax credit program is already at risk in the pending statehood referendum legislation. It could also become a likely target of the current Capitol Hill game of raising government revenues without appearing to the general electorate to be raising taxes. The AHP consolidation and restructuring plan is part of the digestion of A.H. Robins. "As is frequently necessary in major acquisitions, a comprehensive review of all facilities has been undertaken," Whitehall said in a press release. "That review indicated the need for restructuring and consolidation of operations." The company also pointed out that "significant changes have already taken place in many locations." For example, "at Robins' Richmond, Va. headquarters the work force has been reduced by more than 500 positions," and "consolidation of distribution facilities of Whitehall and Robins in several cities in the U.S. has already been completed," the release states. A spokesperson added that layoffs are planned in Whitehall plants in Hammonton, N.J. and Puerto Rico as well as in Elkhart and Richmond.

You may also be interested in...



Part D Discount Liability Coming Into Focus: CMS Releases Drug Cost Data

Newly released Medicare Part D data sheds light on the sales hit that branded pharmaceutical manufacturers will face when the coverage gap discount program gets under way in 2011

FDA Skin Infections Guidance Spurs Debate On Endpoint Relevance

FDA appears headed for a showdown with clinicians and the pharmaceutical industry over the proposed new clinical trial endpoints for acute bacterial skin and skin structure infections, the guidance's approach for justifying a non-inferiority margin and proposed changes in the types of patients that should be enrolled in trials

Shire Hopes To Sow Future Deals With $50M Venture Fund

Specialty drug maker Shire has quietly begun scouting deals with a brand-new $50 million venture fund, the latest of several in-house investment arms to launch with their parent company's pipelines, not profits, as the measure of their worth

UsernamePublicRestriction

Register

IV001392

Ask The Analyst

Ask the Analyst is free for subscribers.  Submit your question and one of our analysts will be in touch.

Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

All fields are required.

Please make sure all fields are completed.

Please make sure you have filled out all fields

Please make sure you have filled out all fields

Please enter a valid e-mail address

Please enter a valid Phone Number

Ask your question to our analysts

Cancel