Park County officials seek boost for $106 million Cody Laboratories expansion

2014-02-11T07:00:00Z Park County officials seek boost for $106 million Cody Laboratories expansionBy BENJAMIN STORROW Star-Tribune staff writer Casper Star-Tribune Online

Park County officials are seeking $34 million in public funding to aid a major expansion of Cody Laboratories.

The proposed $106 million expansion of the pharmaceutical manufacturer would bring an estimated 250 jobs to the county during the next decade, local officials there said. The laboratory, which currently employs 110 people in Cody, makes the ingredients in pain medications.

Area officials touted the expansion as a boon to northwestern Wyoming’s economy, long reliant on the mineral, tourism and agricultural industries.

“Pain medications aren’t subject to the whims of weather, the whims of commodity pricing,” said James Klessens, CEO of Forward Cody, an economic development agency. “We’re going from a company that has several million in revenue to one that might have near a billion in the next 20 years. And what that does is stabilizes the economy of Cody and the Big Horn Basin.”

But officials must first convince Lannett Co., a Philadelphia-based pharmaceutical firm, to expand its manufacturing operations on the outskirts of Yellowstone National Park. Their pitch will largely hinge on whether Wyoming policymakers appropriate money for the project.

Under the Park County proposal, Lannett would contribute $71.5 million to the expansion. The approximately $34 million in state funding would come from several sources: a $24.4 million loan to be appropriated by the Legislature, $9.5 million in Wyoming Business Council grants and $1.2 million from Forward Cody. The money would pay for the installation of water, sewage and other infrastructure investments.

The Legislature is expected to take up the request during its budget session this month.

Lannett’s request for public financing was prompted by a desire to protect its investment in its current facility, a former Wal-Mart building on the west end of town, Klessens said. The company purchased Cody Labs in 2007 and has invested $50 million in its operations there, he said. If Wyoming fails to provide the money, Lannett could choose to expand in Pennsylvania, where its operations are currently centered, Klessens said.

The expansion calls for two new production facilities, power plant, machine shop and administrative offices to be constructed on a 25-acre plot in the North Cody Industrial Park.

The project would generate around $40 million in property and sales taxes while bringing up to 360 high-paying jobs to the area by 2026, Klessens said. The average salary of an employee at Cody Labs is $55,000, meaning a total payroll of around $20 million when the facility becomes fully operational, he said.

“This is a big project. This is a big dollar amount. I am acutely aware of the magnitude of the request,” Klessens said in reference to the public financing. “I think this is a worthwhile investment for the taxpayers of the state.”

Lannett CEO Arthur Bedrosian has committed to expanding in Cody with a state commitment, Klessens said. 

The Cody City Council approved a revised development plan for the expansion in December. The plan has also received a warm reception from state officials.

Gov. Matt Mead signaled his support for the project in December after receiving a briefing from Cody Labs and officials in Park County. A Mead spokesman said Monday the governor looks forward to hearing more about the project and will be watching closely to see how the Legislature addresses the proposal in the coming budget session.

The expansion represents a unique opportunity to create high-paying jobs in a sector where Wyoming has little development, said Robert Jensen, CEO of the Wyoming Business Council.

“It does seem like from what we understand this expansion is well conceived and thought through,” Jensen said. “The expansion of the pharmaceutical industry in the state as a diversification opportunity seems like a significant opportunity for Wyoming.”

The expansion plan calls on two stages of development. The first would see work on a $3.6 million hazardous material warehouse begin this year. The second would see construction on the two production facilities begin in 2015. Initial plans call for the addition of three new production lines. The facility is projected to be operational by 2018.

But there are further opportunities for expansion at the two facilities, which would be able to accommodate up to 12 production lines, Klessens said. One new line a year could be installed at the cost of $8 million each between 2018 and 2026, he said.

Cody Labs is one of 12 facilities in the country with a license to import concentrated poppy straw, used in so-called active pharmaceutical ingredients. The laboratory essentially refines the raw materials into the ingredient that ultimately goes into pain medications such as oxycodone, morphine sulfate oral solution and cocaine topical solution.

Cody Laboratory officials couldn't be reached for comment.

Reach energy reporter Benjamin Storrow at 307-266-0535 or benjamin.storrow@trib.com. Follow him on Twitter @bstorrow

Copyright 2015 Casper Star-Tribune Online. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(9) Comments

  1. Penny Stocks
    Report Abuse
    Penny Stocks - February 16, 2014 7:40 am
    Everybody has made a bad investment at one time or another. Let's just consider Dewey's ill advised contribution to Forward Cody as his' worm farm.' But, Cody Business, since you are the #1 cheerleader for Forward Cody, please explain why the Eleutian 'castle' is only about 25% occupied with employees? Where's all the $50,000 yr. jobs promised? Wyoming Authentic Products? They're right around 1/3 staffed. Forward Cody was started as a feel good project by two local bankers - one was pretty much ousted from his bank while the other is currently in deep water for trying to shuck and jive the SBA over some million dollar + scheme. Regardless of your claim, much of what keeps Klessens in gas money is public contributions. Now, here is a challenge for you, Cody Business - has James Klessens ever started, owned and operated a business? Shouldn't the CEO of an economic dev firm have real business experience? Klessens was a low level USDA bureaucrat, never a businessman. Most of the genuine business people in Cody have seen right through him.
  2. Cody Business
    Report Abuse
    Cody Business - February 15, 2014 6:44 pm
    Nope, neither of those people, but keep guessing - take it from your user name that you are from the other side of Powell, so you probably don't know Cody that well.

    I could go ahead and name businesses that they have helped, like Wyoming Authentic Products or Eleutian, but then you would just respond with "but those aren't the projects I like :(" Oh well. Maybe you should call them yourself.

    The hilarious thing is that when I went to the Forward Cody website to get some info - guess who is an investor in Forward Cody. It's Cody Coyote! And they use his photography on his site - which he probably got paid for. That's rich - nice hypocrisy coming from the Forward Cody critics.

    By the way, you sound like you comment quite a bit on here...you and Dewey might find this interesting.... http://io9.com/why-do-trolls-annoy-you-online-because-theyre-sadists-1522842115
  3. Mantua Draw
    Report Abuse
    Mantua Draw - February 11, 2014 9:50 pm
    Hey Cody Business! Probably otherwise known as Stan Wolz or maybe even Jamie Klessens himself! Welcome to the discussion. A very significant part of what keeps Klessens slick and mouth running is public money, so don't try pulling that almost all private money supports his illusion. Also just one quick question for you, Cody Business: NAME these people and businesses that you claim Klessens helped to succeed. Come on, it shouldn't be that tough, is it? What has Klessens produced? Your que, Cody Business
  4. Cody Business
    Report Abuse
    Cody Business - February 11, 2014 5:44 pm
    Hey cody coyote, aka Dewey. Good job demonstrating the almost-complete list of logical fallacies. Ad hominem attacks? Check! Straw man arguments? Check! Begging the question? Check!

    Klessens, whose salary and programs are almost entirely paid for with private funds, has spent the last several years helping people and businesses succeed. Not like some, who have spent their entire lives trying to find things to tear down in their hometown without ever contributing. We have some photographers who fit that bill...

    Have I ever heard of state-stimulated economic development that has paid off ? Oh look - the first one that came to mind. http://www.timesfreepress.com/news/2013/jun/05/vw-plants-impact-better-than-projected/

    Huh.

    This is an investment in town, with a business that already contributes millions annually to our community. The opportunity didn't start in Philadelphia - it started here. The state will recoup the money and more, while tour neighbors get better jobs. This is pure capitalism at its finest.

    And oh yeah - all of our biggest industries get this sort of help. That's the way the world works. Just don't be bitter because Lannett won't by your little photos of broken down trucks.
  5. THE CREAMERY
    Report Abuse
    THE CREAMERY - February 11, 2014 3:56 pm
    pretty much anybody who's anybody park county knows that klessens and forward cody have produced near zilch. sure, they've created an illusion of all those unseen opportunities, businesses and jobs created, just ask klessens, then ask klessens to physically show you these grand achievements______________________don't bother, it's a smoke & mirrors strategy that would be attempted on you. klessens is a mastermind of gathering weak thinking individuals such as a couple of the cody councilman plus the president of an out of state construction company pretending to be a wyoming based company into thinking they can be a part of something bigger then themselves. Cody Coyote pretty much has a bead on forward cody scharade.
  6. side oiler
    Report Abuse
    side oiler - February 11, 2014 8:51 am
    I recall the fiasco over Two Rivers quite well,and the fools in Codyfornia fell for his line of BS hook,line,sinker...and worm.Having lived in Cody years ago when things were more normal and jobs more plentiful,I have no sympathy for the town.
  7. 99Savage
    Report Abuse
    99Savage - February 11, 2014 8:40 am
    Cody Labs is doing what all companies do. Play one state against another for their business. The politicians do what they think is their duty. Spend the taxpayer's money. A perfect fit. That doesn't justify it or make it right. The funniest part is the politicians then wonder why they are so hated.
  8. Cody Coyote
    Report Abuse
    Cody Coyote - February 11, 2014 8:33 am

    This takes feeding at the Public Trough to a whole new level. And this time around, we get a genuine Philadelphia Lawyer to deal with !

    Oh by the way ...Klessens came to Cody from Hardin Montana where he was the spearhead behind the Two Rivers Prison, a private for profit prison that never opened once it was built at a cost of many millions. Still hasn't been used. Before that he was a lowly USDA bureaucrat for 20+ years. But they know him well in Cheyenne when it comes time to beg for the big bucks.

    His group Forward Cody was initially formed under the auspices of two local bank Presidents who raised the money to endow Klessens with $ 125,000 per year in salary and fund an office. They even use public money for some of that , too. Apparently , you cannot do economic development anywhere in Wyoming without feeding at the public trough. Klessens has a personalized chair int he front row of all the Wyoming Business Council and SLIB board meetings.

    But try and find examples any anywhere, any time, any circumstances where using public funding, tax incentives, and set asides to bring in new business have EVER repaid the public for its investment. From Airbus and BMW factories in the South all the way down to Klessen's pet projects in l'il ole Cody Wyo - a USDA butcher shop, the dubious Eleutian Technologies ( an illusion , that outfit ), and a sgtartup that makes bulletproof vests that pays its help barely above minimum wage--- and you quickly see economic development is largely a giveaway. A scam . A method of legal extortion that savvy companies use to jack the public under threat of taking their precious jobs somewhere else.

    Here's the deal. Cody Wyoming has five full service commercial banks and one good sized savings and loan bank. That's a lot for a town this size. They collectively have well north of a billion dollars in deposits and liquid assets.

    WHY doesn't Forward Cody and Klessens put together a local p[rivate equity fubnd for projects like Lannett Opium Inc / Cody Labs ???? Why ?

    If this expansion is such a sure bet and a great job magnet and economic multiplier, why wouldn't the private sector jumpall over it with capital ? Why not ask an angel investor ot VC from the West Coast to invest if this is such a deal ?

    Why instead does Klessens and his Merry Men go straight to the public trough in Cheyenne,. this time to ask the LEgislature for a DIRECT APPROPRIATION of $ 24- 36 million . I can't recall when something like this ever reared its head around here. $ 36 million in state funding to underwrite an out of state Philadelphia drug maker who makes morphine and a few other really powerful completely regulated DEA intensive drugs. This is Big Pharma at its finest...corporate for profit medicine co-opting the system. Oh by the way , Cody Labs was shut down back out of the blue back in 2007 for a while. by the FDA or DEA.

    The ONLY way that Lannett / Cody Labs will get even a fraction of that money from the State is if they also build a guns and ammo assembly line next door, right ?

    Stay tuned. This is some world class economic subsidized chicanery going down...

  9. side oiler
    Report Abuse
    side oiler - February 11, 2014 7:58 am
    RINO's begging for money...now that's entertainment.
Untitled Document

Civil Dialogue

We provide this community forum for readers to exchange ideas and opinions on the news of the day. Passionate views, pointed criticism and critical thinking are welcome. Name-calling, crude language and personal abuse are not welcome. Moderators will monitor comments with an eye toward maintaining a high level of civility in this forum. Our comment policy explains the rules of the road for registered commenters.

If your comment was not approved, perhaps...

  1. You called someone an idiot, a racist, a dope, a moron, etc. Please, no name-calling or profanity (or veiled profanity -- #$%^&*).

  2. You rambled, failed to stay on topic or exhibited troll-like behavior intended to hijack the discussion at hand.

  3. YOU SHOUTED YOUR COMMENT IN ALL CAPS. This is hard to read and annoys readers.

  4. You have issues with a business. Have a bad meal? Feel you were overcharged at the store? New car is a lemon? Contact the business directly with your customer service concerns.

  5. You believe the newspaper's coverage is unfair. It would be better to write the editor at editors@trib.com, or call Editor Jason Adrians at 266-0545 or Content Director David Mayberry at 266-0633. This is a forum for community discussion, not for media criticism. We'd rather address your concerns directly.

  6. You included an e-mail address or phone number, pretended to be someone you aren't or offered a comment that makes no sense.

  7. You accused someone of a crime or assigned guilt or punishment to someone suspected of a crime.

  8. Your comment is in really poor taste.

Add Comment
You must Login to comment.

Click here to get an account it's free and quick