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BIVI plant to be sold to Elanco

By Staff | Oct 15, 2016

FORT?DODGE -A subsidiary of pharmaceutical giant Eli Lilly and Co. plans to buy the Fort Dodge facility of Boehringer Ingelheim Vetmedica Inc. and the portfolio of products made there in an $885 million deal announced by company officials and local leaders on Oct. 5.

Pending regulatory approval, Elanco U.S. Inc. plans to take ownership of the site in January.

“They’re buying everything that’s out here,” said Dennis Plautz, the chief executive officer of the Greater Fort Dodge Growth Alliance.

Plautz said Elanco U.S. Inc., based in Greenfield, Indiana, plans to retain all of the plant’s employees. Boehringer Ingelheim Vetmedica has about 500 workers and is one of the biggest employers in the community.

Plautz added that $100 million worth of improvement projects now underway at the site will be completed.

“I think this is a good opportunity for Fort Dodge,” Plautz said.

Boehringer Ingelheim Vetmedica Inc. executives announced in April that the plant at 800 Fifth St. N.W. would be sold to meet regulatory requirements imposed on a pending deal between it and another company.

Local officials welcomed the reported deal for the Fort Dodge plant.

“We are excited about this announcement,” Webster County Supervisor Mark Campbell said. “It’s a great step forward for Fort Dodge and Webster County.”

Campbell described the deal as “one more benefit of the collaboration of the city and the county and the professionalism of the Growth Alliance.”

Fort Dodge Mayor Matt Bemrich called the pending deal “an exciting opportunity.”

“Our understanding is that the acquisitions they have made have been very successful,” he said, referring to Elanco U.S. Inc.

In a statement announcing the pending deal, Elanco U.S. Inc. reported that it is acquiring eight new product lines and a “fully integrated manufacturing and R & D site.” The new product lines include vaccines for cats and dogs.

“As a result of the acquisition, Elanco will bring greater value to customers by providing a suite of options for preventing common diseases in companion animals,” John C. Lechleiter, the chairman, president and chief executive officer of Eli Lilly and Co., said in the statement.

“Coupled with our robust food animal portfolio, this addition further strengthens Elanco’s position in the global animal health business,” he added.

The sale is dependent on the approval of the Federal Trade Commission and the completion of another transaction in which Boehringer Ingelheim Vetmedica Inc. is involved.

“It does not appear that there are any major hurdles to either of those things happening,” Plautz said.

The plant’s sale has its origins in that other transaction, which is a deal between Boehringer Ingelheim Vetmedica Inc., based in Germany, and Sanofi, based in France, that was announced in December 2015.

Under the terms of that deal, Sanofi will give Boehringer Ingelheim its animal health business, called Merial. In return, Boehringer Ingelheim will give Sanofi its consumer health care businesses, except those in China, and cash.

Merial once had a presence in Fort Dodge. A Merial plant was located at 2116 Eighth Ave. S. from 1989 to 2000.

In an effort to prevent Boehringer Ingelheim from becoming an unfair monopoly after it acquires Merial, the Federal Trade Commission is requiring it to sell some of its pet vaccine capacity before it will approve the deal. To comply with that requirement, company officials decided to sell the local plant.

“This agreement is an important step toward a successful acquisition of Merial,” Albrecht Kissel, the president and chief executive officer of Boehringer Ingelheim Vetmedica Inc., said in a written statement. “This was a highly complex decision from a business and from an emotional perspective. It was certainly not taken lightly particularly in view of the history and significant positive developments of this business over the past years.”

“We are confident that, under Elanco’s leadership, customers will continue to have access to these innovative vaccines and the portfolio will have strong support,” Kissel added.

The German company’s upcoming departure from the community mirrors its arrival. It bought the plant in 2009 after the Federal Trade Commission ordered Pfizer Inc. to divest some of its assets after it bought Wyeth, the parent company of Fort Dodge Animal Health.

“BI has done a very good job of keeping us informed and we certainly appreciate working with a company that’s willing to provide all the information it can legally share,” Plautz said.

He said a transition team working on the plant’s sale includes local managers from Boehringer Ingelheim Vetmedica Inc.

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