When a company decides to leave town, community leaders sometimes try to downplay the impact. But Affymetrix Inc. has been too important to the area's biotech industry for that.
The company confirmed Friday that it's closing its 9-year-old factory in West Sacramento next spring and will transfer most of its functions to its plant in Singapore.
About 100 jobs will be affected, although some employees will likely find work elsewhere at Affymetrix, said spokesman Andrew Noble from the company's headquarters in Santa Clara.
Area officials were candid about the significance of the loss. They called Affymetrix a major employer and pioneer in the region's biotech business.
"Affymetrix was … one of the early companies in the life sciences area," said J.D. Stack, chief executive of the Sacramento Area Regional Technology Alliance. "Kind of an iconic company in the Sacramento area. It really hurts to lose them."
Noble said the company is consolidating its five factories into three, eliminating West Sacramento and South San Francisco.
"We needed to lower our cost structure," he said. "Our manufacturing footprint was too big." He said some of the work started moving out in the spring.
Affymetrix's West Sacramento factory makes something called a GeneChip, a tiny glass wafer coated with DNA and enclosed in a plastic cartridge. Drug company researchers and others use the chips to analyze blood and tissue samples. The plant also makes chemicals and instruments used to work with the chips.
Affymetrix is struggling financially: It recently posted a $3.6 million quarterly loss on a 1.6 percent decline in revenue. Noble said technological improvements have reduced the company's manufacturing space needs.
Diane Richards, West Sacramento's economic development coordinator, said the departure was surprising because Affymetrix spent around $20 million just two years ago to expand its operation.
Although the company had hinted in the past two years that some manufacturing might leave, there was no suggestion of a total shutdown, she said.
"This is a company we've been talking to on a regular basis," she said. "They were happy here."
At the same time, she acknowledged that global and technological forces made the plant "a candidate for offshoring."
One consolation: Affymetrix will maintain its 30-employee clinical testing lab on Riverside Parkway across the street from the factory complex. Noble said the lab is likely to add some jobs because work will be relocated from South San Francisco.
When the plant opened in 1999, city officials thought it would mark the beginning of a biotech manufacturing boom. Richards said that hasn't really panned out.
Stack, however, said area leaders are still trying to jump-start biotech in greater Sacramento. SARTA has launched an initiative focusing solely on medical technology.
"I'm encouraged that the medical technology, life sciences sector has opportunities for growth," he said.
Curt Overmeyer, in charge of business retention for West Sacramento, said the assembly line workers are paid $15 to $18 an hour.
Call The Bee's Dale Kasler, (916) 321-1066.
