Pharmaceutical Company Bristol Myers Squibb to Close Operations in Humacao
After receiving confirmation in advance, Bristol Myers Squibb (BMS) has announced the closure of its operations in the municipality of Humacao. The company stated that the plant’s current capacity is insufficient for their future product line. While BMS denied that the decision was solely due to increased energy costs in Puerto Rico, sources suggest that it was a contributing factor. The company’s statement did not mention the fate of the 400 workers at the plant or the closure date. However, employees were informed during a meeting that some may have the opportunity to transfer to the company’s operations in Manatí, along with an economic package.
Unfortunately, the majority of employees will lose their jobs in the coming months, coinciding with a time when expenses typically rise. Furthermore, employees received a communication from the company acknowledging that the news of the closure had been leaked to the media, which they described as “very unfortunate.”
The company expressed regret for not being able to share the information with employees in a more dignified and respectful manner. They had planned to discuss the details during a business meeting, which was initially scheduled for the following day but was abruptly rescheduled for the morning of the same day. According to employees, this sudden change led to fainting, crying, and even nervous breakdowns.
Official Company Statement
BMS stated, “Our business model is evolving to support our mission of discovering, developing, and delivering innovative medicines. As part of this evolution, we regularly assess our manufacturing processes to better align with our operating model and portfolio.” The company explained that the closure of the Humacao plant is due to inadequate capacity for their future product line and ongoing operational challenges. However, until the closure, the facility will continue to operate as part of the BMS network.
BMS emphasized that Puerto Rico remains an important location for the company, with its manufacturing plant in Manatí and commercial office in Guaynabo.
The Secretary of the Department of Economic Development and Commerce (DDEC), Manuel Cidre, announced that they will provide assistance to BMS employees through the Labor Development Program. They are also exploring opportunities to hire displaced workers in other plants that could benefit from their specialized skills.
Impact on Puerto Rico’s Pharmaceutical Industry
The closure of BMS’s Humacao plant is a significant blow to the pharmaceutical industry in Puerto Rico, which accounts for over 70% of the island’s total exports. In 2021, pharmaceutical products and medicines generated nearly $45 billion in revenue. The industry provides approximately 18,000 direct jobs and supports an additional 51,000 indirect jobs. It also contributes to the local economy by engaging around 800 local suppliers.
Governor’s Response to Energy Concerns
Governor Pedro Pierluisi addressed reports suggesting that energy costs influenced BMS’s decision. He stated that electricity costs have actually decreased in the past six months and that he will oppose any significant increase approved as part of the Electric Power Authority’s (AEE) Debt Adjustment Plan (PAD). However, he acknowledged that PREPA, the public corporation responsible for electricity, must repay its bondholders for the accumulated debt.
The governor emphasized that the government’s goal is to reduce PREPA’s debt as much as possible. He mentioned that bondholders are demanding full repayment of the $8.5 billion debt, while experts suggest that PREPA can only afford to pay $2.1 billion.
Focus on Job Creation and Industry Expansion
When asked about the 400 employees affected by BMS’s closure, the president highlighted the expansions of other companies, such as Coopervision in the southern area and Neolpharma in Caguas. He also mentioned that a recently closed factory in Las Piedras is already being marketed for use by another entity. Despite the closure, the manufacturing industry in Puerto Rico has seen overall growth, with an additional 13,000 jobs created compared to the beginning of 2021.
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