Jobs lost as GroPep facility shuts

More than 30 staff at the former Biotech Australia (BA) will lose their jobs in the operational restructure planned by Adelaide growth factor company GroPep.

Last week GroPep announced it would close and sell the manufacturing facility in Sydney's Roseville, which it took on as part of the $11 million purchase of the BA group of companies in February.

Chief operating officer Dr Chris Goddard told the market the restructure plans followed a review of GroPep's major business units and was intended to lead the company to profit by 2003/4.

But the market announcement did not include the fact that all but three of the 35 staff at the Roseville plant would have their jobs terminated.

It explained only that the sale process would begin immediately with closure expected in early 2003, and that additional costs of about $3 million would be incurred as a result of winding up the business.

Sources working at the facility said the news had come out of the blue and was met with shock by staff.

They said that despite some difficulties within the business, staff had felt secure in their positions since the purchase of the companies by GroPep and had felt things were moving forward.

"This company has been in trouble a few times, but it was different this time because we didn't have the usual indications," one redundant staff member said. "They had hired two or three new people in the past few months, they had kept ordering things and there had been no tightening of expenditures. We had no reason to think that our jobs were not safe."

Newcomers through to senior scientific staff who had spent as long as 20 years with the company were now examining their options.

Australian Biotechnology News has learned that on May 29, a month after they had been promised a business plan, GroPep business development manager Greg Moss-Smith told Roseville staff their jobs could be in danger if finance to improve the site could not be found.

The day after the June 3 market announcement disclosing the operational changes, staff were called to another meeting where they were told the site was to be closed and all but three of them retrenched.

It is understood positions in Adelaide have been offered to production manager Phil Wordsworth, contract manufacturing organisation manager Nick Kotlarski and quality control manager Barbara Rone-Clark, who joined the company just four days before the terminations were announced.

While GroPep said it had not yet received written acceptances from the staff members, Rone-Clark confirmed that she would be moving to the Adelaide site. Goddard said that the company had been under obligation to keep its options quiet, because of market disclosure rules.

He said the company had every intention of trying to make Roseville work and had taken the business on in good faith.

"It became obvious in the end it wasn't going to work, but we did everything we could as far as the staff are concerned," Goddard said. "We're going through what is a difficult exercise and there is not much more I can add."

Former head of science and business development at BA, Dr David Irving, said the concept behind the merger had been one that was desperately needed in Australia.

"The opportunity that we saw at the site here at BA of working with GroPep to develop a contract manufacturing and development biopharmaceutical complex was good," Irving said. "It's very disappointing from our own perspective and for biotech in Australia that we don't really have this serious capability in this area."

New life

Former business development manager Nicola Leaney said some of the staff were working towards reforming as a new contract manufacturer. Speaking from Bio 2002 at Toronto, Leaney said she had already been in talks with the NSW government and with various partnering people in Canada.

She said she and a group of people currently working on a number of existing contracts were keen to redress the balance and find a way of moving forward.

"We're currently discussing the possibility of setting up a group that will go forward in contract manufacturing in NSW, because I believe NSW and Sydney will be a gateway to Australia for the rest of the world to demonstrate what we are capable of achieving," Leaney said.

She said Roseville was too expensive to maintain or refit, with the group of about six former staff actively looking for premises close to the airport suitable for laboratories and a manufacturing facility.

Leaney said most staff would have to find new jobs by June 28, although some were on contracts that would see them stay on for another couple of months.