Hauppauge drugmaker wants to add 25 jobs, renew warehouse lease

One of Long Island’s largest drugmakers is expanding its workforce again.

Contract Pharmacal Corp. in Hauppauge plans to add 25 jobs over the next two years to its payroll of 1,358. The positions will pay $60,000 per year, on average.

The proposed hiring is part of a $1.4 million plan to renew the drugmaker’s lease on 250 Kennedy Dr., also in Hauppauge, for at least eight years and make improvements to the warehouse, laboratory and pharmacy there.

CPC chief financial officer Eric Antman said the project is contingent on the company securing $546,480 in tax breaks over 10 years from Suffolk County. Last week, the county’s Industrial Development Agency voted unanimously to grant preliminary approval for the tax aid, which now will be the subject of a public hearing and final vote by the IDA board.

Antman told the IDA board that CPC needs the tax breaks because the owner of the Kennedy Drive building, Rechler Equity Partners in Plainview, wants "a tremendous increase" in rent. He said the drugmaker has been using the 128,000-square-foot facility for five years.

Rechler Equity, through a spokesman, declined to comment on Tuesday.

Without the IDA’s help, Antman said last week that CPC "would not renew the lease and would have to consolidate operations," including possibly laying off some of the 92 employees who work in the building. "That’s not what we want to do. We want to grow," he said.

Antman was responding to questions from IDA board member Joshua Slaughter about CPC’s history of receiving tax breaks since the late 1980s. Six of the company’s 11 facilities, all of them in Hauppauge, are now receiving IDA aid.

"You’ve expanded significantly over the last decade since receiving IDA assistance" to remain in Suffolk rather than move to Florida, home to some of CPC’s owners, Slaughter said. "I do have concerns about whether there is still a true need here."

Records show CPC’s workforce has grown from 450 in 2010 to a high of 1,390 two years ago. Employees produce generic prescription drugs, over-the-counter medicine, vitamins and hemp supplements.

"I don’t see IDA benefits as being indefinite for the company," Slaughter said. "At some point, they are supposed to expire, and you’re supposed to pay full [property] taxes."

CPC, under the proposed tax deal, would pay 72.5% of the property taxes on the Kennedy Drive building.

The family-owned company was started in 1971 and the majority shareholders are Matthew and Mark Wolf.

IDA vice chairman Kevin Harvey, retired business manager of Local 25 of the International Brotherhood of Electrical Workers union, said the union’s headquarters is in the Hauppauge Innovation Park, which has been transformed by CPC and other drugmakers.

"You have basically revitalized that area," he said last week.

IDA executive director Anthony J. Catapano said helping CPC to renew its lease on the Kennedy Drive building "ensures the company continues to expand on Long Island and doesn’t explore opportunities elsewhere," such as India where CPC also operates.

Pharmaceuticals is Long Island's largest manufacturing sector, with double the number of employees as the second-largest sector — instruments — according to a report by the IDA and the Workforce Development Institute in Albany.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.