According to a report in The Scotsman, Avecia confirmed that a rapid exodus of clients and projects meant that the facility would close within the next few months.
In February 2004, Avecia expanded the capabilities of the Grangemouth unit by opening an early phase production unit for DNA medicines (oligonucleotides) at the plant, upgrading it to an all-phase production facility. But despite their promise, oligonucleotide-based medicines have failed to break into the commercial arena, held back by problems with drug delivery.
A spokesman for the company told the newspaper that a number of setbacks recently had been compounded by news last week that a drug from one of its largest customers, US-based Corgentech, failed at the Phase III trial stage earlier this month. He said their were no customers scheduled to make use of the unit by the middle of this year.
Avecia also has a large-scale chemical manufacturing plant at Grangemouth - Avecia Fine Chemicals - employing 500 people - but this is performing well and is not at risk.
Meanwhile, Avecia also announced that it has completed the sale of its organic light emitting diodes (OLED) materials and polymer electronics businesses to Merck for €50 million. The combined units had sales of approximately €8 million in 2004.
Earlier this year, Avecia spun out some of its pharmaceutical activities into a new business called Reaxa, while it sold off a nitroglycerin unit at the end of last year.