Foreign-Trade Zone 104Savannah, Georgia; Application for Subzone, Merck & Co. Pharmaceutical Plant, Dougherty County, GA

DEPARTMENT OF COMMERCE

Foreign-Trade Zones Board

[Docket No. 1-94]

Foreign-Trade Zone 104--Savannah, Georgia; Application for

Subzone, Merck & Co. Pharmaceutical Plant, Dougherty County, GA

An application has been submitted to the Foreign-Trade Zones Board

(the Board) by the Savannah Airport Commission, grantee of FTZ 104,

requesting special-purpose subzone status for the pharmaceutical

manufacturing facility of Merck & Co., Inc., (Merck) in Dougherty

County, Georgia. The application was submitted pursuant to the

provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-

81u), and the regulations of the Board (15 CFR part 400). It was

formally filed on January 3, 1994.

Merck is one of the world's largest pharmaceutical manufacturers

with nearly $9 billion in total sales in 1991. Its primary product

lines include: patented prescription and over-the-counter

pharmaceutical products, veterinary pharmaceuticals and agricultural

and specialty chemicals. This proposal is part of an overall company

cost reduction effort (Subzone status is being requested for seven

other Merck facilities).

Merck's Georgia plant (800 acres, 283,910 sq. ft., 35 bldgs.) is

located at 3517 Radium Springs Road, Dougherty County, Georgia, 7 miles

southeast of Albany and some 180 miles southwest of Savannah. The

facility (310 employees) is used to produce bulk pharmaceutical

chemicals and intermediates used in Merck's human and animal health

products. Company plans call for expansion of plant facilities to

include refrigerated storage and tank farms.

At the outset, zone procedures would be used primarily for the

production of Cefoxitin, Omeprazole, and Losartan. Zone procedures

could also include production of remoxipride hydrochloride, TRUSOPT,

and chlorsulon. Currently, foreign-sourced materials account for 10 to

20 percent of finished product value and include the following specific

ingredients: TAC (Thienylscetyl chloride), P-TSC

(Paratoluenesulfonchloride), metmereazole, pyrmethyl alcohol, imidazole

intermediate, bromo benzyl bromide, S-2-Aminomethyl-1-ethyl

pyrollidone, N-Bromo-Succinimide, hydroxy sulfone, M-Nitro

benzaldehyde. The company also may purchase from abroad other active

ingredients and items in the following general product categories:

gums, starches, waxes, vegetable extracts, mineral oils, phosphoric

acid, hydroxides, hydrazine and hydroxylamine, chlorides, phosphates,

carbonates, hydrocarbons, alcohols, phenols, ethers, epoxides, acetals,

aldehydes, ketone function compounds, mono- and polycarboxylic acids,

phosphoric esters, amine-, carboxymide, nitrile- and oxygen-function

compounds, heterocyclic compounds, sulfonamides, vitamins, hormones,

sugars, antibiotics, gelatins, enzymes, color lakes, soaps and

detergents, medicaments, and pharmaceutical products. The company may

also source from abroad insecticides, rodenticides, fungicides and

herbicides for use in agricultural/veterinary products.

Zone procedures would exempt Merck from Customs duty payments on

foreign materials used in production for export. On domestic sales, the

company would be able to choose the duty rates that apply to the

finished products (duty-free to 23.5%, most falling in the 3.7% to

16.6% range). The duty rates on foreign-sourced items range from duty-

free to 23.5 percent, with most falling in the 3.7%-20% range. The

application indicates that the savings from zone procedures will help

improve the firm's international competitiveness.

In accordance with the Board's regulations, a member of the FTZ

Staff has been designated examiner to investigate the application and

report to the Board.

Public comment is invited from interested parties. Submissions

(original and 3 copies) shall be addressed to the Board's Executive

Secretary at the address below. The closing period for their receipt is

on March 14, 1994. Rebuttal comments in response to material submitted

during the foregoing period may be submitted during the subsequent 15-

day period (to March 29, 1994).

A copy of the application and accompanying exhibits will be

available for public inspection at each of the following locations:

Port Director, Port of Savannah, U.S. Customs Service, Southeast

Region, 1 East Bay Street, Savannah, Georgia 31401.

Office of the Executive Secretary, Foreign-Trade Zones Board, U.S.

Department of Commerce, room 3716, 14th & Pennsylvania Avenue NW.,

Washington, DC 20230.

Dated: January 3, 1994.

John J. DaPonte, Jr.,

Executive Secretary.

[FR Doc. 94-885 Filed 1-12-94; 8:45 am]

BILLING CODE 3510-DS-P