Suffolk wants OSI's $1.6M tax exemption

OSI Pharmaceuticals Inc., the Melville-based maker of the highly successful anti-lung cancer drug Tarceva and much in the headlines lately for fighting a hostile takeover attempt by a Japanese company, may have another worry: a $1.6-million bill from Suffolk County.

That's the amount OSI got from Suffolk's Industrial Development Agency in a sales tax exemption for work done on its headquarters building in Melville.

Suffolk County Executive Steve Levy was said to have done a slow burn last year when OSI announced plans to move, and take about 200 well-paying Long Island high-tech jobs to Ardsley, in Westchester. OSI's departure is a severe blow to the Island's efforts to develop a biotech industry. The company was considered a leader in that plan.

Obviously $1.6 million is not a lot of money for OSI, whose revenue in 2009 was about $428 million, an increase of nearly 13 percent from 2008.

But OSI apparently is not planning to simply turn over the money.

Earlier this week, OSI chief executive Colin Goddard was asked about the money the county claims it is owed. "We've had some ongoing dialogues with the county," Goddard said. "Clearly, there's some differences of opinion here. But we can't comment further on this."

Suffolk IDA executive director Bruce Ferguson acknowledged that the county and OSI are still "going back and forth" about the sales tax exemption. OSI, Ferguson said, claimed a 2006 state audit cleared it of owing anything.

Ferguson said the IDA would like to see that '06 audit. "They were provided with incentives to stay, grow and create jobs in Melville," Ferguson said.

Meanwhile, Astellas U.S. Holdings Inc., the Japanese company that launched a hostile bid for OSI, turned up the heat Tuesday, naming 10 people it plans to nominate for board seats at OSI's annual meeting, for which a date has not yet been selected.

Masafumi Nogimori, Astellas' chief executive, said in a statement, "We have taken this step to provide OSI's stockholders with an alternative to the current board, which refuses to consider Astellas' compelling offer." OSI has said it does not believe Astellas' $52-a-share offer fully recognizes OSI's fundamental value.

OSI said Tuesday that it "believes the Astellas director nominees' only mandate is to support Astellas in acquiring OSI at an inadequate price."