News & Observer | newsobserver.com | Durham goes after a plant

Published: Feb 23, 2006 12:00 AM
Modified: Feb 23, 2006 09:26 AM

Durham goes after a plant

Eisai may get a $1 million carrot

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Durham County officials are willing to put up $1 million in taxpayer money to persuade Japanese drug maker Eisai to build a new manufacturing plant on its existing Research Triangle Park campus.

Officials with Eisai (ay-ZI) have said a decision to locate its new plant for next-generation cancer drugs in RTP will hinge in part on the county's willingness to bear part of the cost, as it did a decade ago when it offered a $1 million subsidy for sewer and water expenses to lure the company to Durham. County officials hope another $1 million, which this time would pay for some construction and utility work, will help land the company's new plant.

The plant is expected to cost about $105 million and could create more than 80 jobs by 2013, according to a county memo. The county's proposed $1 million contribution is a standard incentive that it budgets for each year and would not require a tax increase, officials said.

The new plant would have a tax value of $35 million, which, under this year's tax rate, would send more than $283,000 in new tax revenue to the county's coffers.

"Given the size of the project, this is fairly typical," County Manager Mike Ruffin said of the incentives plan.

The Durham County Board of Commissioners will hold a public hearing on the proposed incentives Monday evening. If the board approves the deal and Eisai accepts it, planning, construction and governmental approvals likely would take several years, county officials say.

Eisai has undergone two large expansions since coming to RTP in the mid-1990s, and most of its 255 employees in RTP produce and package Aciphex, a drug for gastrointestinal disorders, and Aricept for Alzheimer's treatment. The new plant would make liquid cancer drugs the company is developing now.

Japan's fourth largest pharmaceutical firm, Eisai has a U.S. headquarters in New Jersey with research facilities in New Jersey and Massachusetts. Along with its 125-acre RTP site, the company is considering locating its new manufacturing plant in Japan or Italy, according to a county memo.

Reached Wednesday, a corporate spokeswoman would not say whether the firm has selected a site for the new plant.

"Eisai has been considering options for a new manufacturing, formulations and [research and development] facility, but it is premature to comment on a decision," said Cathy Pollini, a spokeswoman at the company's Teaneck, N.J., headquarters.

For a couple of months now, county officials have worked quietly to come up with a workable incentives package to convince Eisai to expand in Durham. Becky Heron, the county board's vice chairwoman, called the company "a good corporate citizen."

"They put people to work," Heron said Wednesday. "I'm just glad they have, hopefully, decided to enlarge and stay where they are."

Deborah Barnes, a spokeswoman for the state Department of Commerce, declined to comment Wednesday on whether the state is considering an incentives package for Eisai as well.

Along with the Eisai deal, county commissioners Monday will consider whether to provide up to $75,000 for relocation and employee training costs to Stiefel Laboratories Inc., a skin-care products company planning to open a $42 million research plant in RTP.

Staff writer Eric Ferreri can be reached at 956-2415 or eric.ferreri@newsobserver.com.
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