Puerto Rico has been losing pharma manufacturing jobs/business over the past decade (falling from 160,000 to 75,000 jobs) as worldwide over capacity has developed. The overwhelming majority of these jobs supported smal molecule manufacturing. Faced with this decline, the goverment says it will pursue "opportunistically" more biological projects. According to government figures, biopharm manufacturing currently represents 25% of their GDP as most new and innovative products are biologics. Eli Lilly (insulin plant) and BMS both have expanding biologics manufacturing facilities on te island.
However, P.R. has recently raised its corporate tax rates, especially on companies who are offshoring there, and must be able to compete with governments like Ireland or Singapore who offer favorable deals to manufacturers. Plus utility costs have been creeping up in P.R. that negatively impact operating costs. So it remains to be seen how market/cost competitive P.R. can be to compete for business.
The local development group, PRIDCO, says that P.R> will be successful in their efforts as, "We provide a value proposition in terms of human capital, infrastructure, incentives and legal framework no other jurisdiction can provide." Business losses of late seem to contradict that so proof will come only when new business can be announced. See Biopharma-reporter.
Posted by Bruce Lehr Dec 6th 2013.