WILMINGTON,The Board of Directors at aaiPharma Inc. (Nasdaq: AAII) have approved the expansion of the company’s manufacturing facilities to support production of its Darvon and Darvocet-N family of pain products and future pipeline products.
Darvon and Darvocet-N were acquired by aaiPharma in late March of this year and are currently manufactured by a third party company under a manufacturing agreement structured at the time of purchase. aaiPharma is based in Wilmington with an operation in Chapel Hill.
aaiPharma says that it plans to invest approximately $2 million in the renovation and expansion of its Wilmington manufacturing facility, which is registered with the Food and Drug Administration and the Drug Enforcement Administration. The expansion, scheduled to begin in the fourth quarter of 2002 and to be completed by late 2004 or early 2005, will be completed without interruption of the aaiPharma’s current manufacturing facility and will increase the company’s current manufacturing capacity by more than 200 percent, it says.
“We are pleased to be increasing the capacity and capabilities of our manufacturing facility,” Philip Tabbiner, president and chief executive officer of aaiPharma, said in a statement. “This expansion is an important component of our overall strategy, not only to insure the continued growth of the Darvon and Darvocet-N family of pain products and future aaiPharma pipeline products, but to add value for our current commercial manufacturing customers.”
The cost of the renovation and expansion of this facility is in-line with previous estimates on capital expenditures given by aaiPharma, according to William Ginna, executive vice president and chief financial officer. Ginna says the current level of cash flow allows for these investments, while at the same time retiring significant amounts of debt from aaiPharma’s balance sheet.