A troubled US plant operated by Boehringer Ingelheim's Ben Venue subsidiary will close by the end of the year, raising the spectre of shortages of a key cancer drug.

The sterile injectables facility in Bedford, Ohio, cannot be put back on a sustainable footing despite "the ongoing support of the US Food and Drug Administration (FDA), the tremendous dedication of employees, and significant investments in facility upgrades," said the company in a statement.

The facility is currently the only plant approved in the US to make Johnson & Johnson's Doxil (doxorubicin), and compliance problems - including sterility failures - have played havoc with J&J's ability to supply the drug over the last couple of years.

Ahead of the closure announcement, J&J warned that it was likely to experience "outages" in Doxil supply later this month, and was unable to estimate when the drug would become available again. The company has filed a lawsuit alleging breach of contract and trying to force Boehringer into arbitration proceedings.

The decision puts 1,100 workers on notice of a phased reduction in headcount - starting this month - as the activities at the plant are wound down.

In a statement, Boehringer said the "magnitude of continued investment and time required to overcome the systemic manufacturing challenges is not viable," noting that $350 million has been invested in the plant to date with losses of $700 million or more expected if it continues to run Bedford over the next five years.

The closure will have a major impact on J&J's efforts to develop an alternative manufacturing process for Doxil. While the company has been working to transition production to another contract manufacturer, an interim stage has seen it take bulk drug made at Bedford for finishing at another supplier.

The FDA has approved imports of a generic version of doxorubicin from Sun Pharmaceutical called Lipodox in February under a priority review process designed to help alleviate drug shortages.

Meanwhile, the Bedford facility is not the only facility in Boehringer's network to have attracted negative attention from the FDA. An inspection of Boehringer's main site in Ingelheim prompted a letter from the agency earlier this year citing significant violations of current good manufacturing practice (cGMP) for the manufacture of active pharmaceutical ingredients (APIs) and for finished drugs.

At the end of June, Wolfram Carius, Boehringer's board member with responsibility for biopharmaceuticals and production, stepped down to be replaced by former development head Wolfgang Baiker.