GlaxoSmithKline to build UK biopharm factory

GlaxoSmithKline has unveiled plans to build its first new manufacturing facility in the UK in almost 40 years (AFP/Getty Images)

Pharmaceuticals giant GlaxoSmithKline unveiled plans to build its first new manufacturing facility in the UK in almost 40 years today.

The proposed biopharmaceutical facility at Ulverston in Cumbria is part of £500 million of investment that Glaxo expects will create up to 1,000 UK jobs.

The commitment to the UK, including two manufacturing sites at Montrose and Irvine, follows confirmation in the Budget that the Government will introduce a "patent box" to encourage investment in research and development in the UK.

Glaxo, which employs 15,000 people in the UK with almost 6,000 in manufacturing, said construction on the £350 million project at Ulverston is expected to begin in 2014/15, dependent on planning consents.

As well as Ulverston, existing Glaxo sites at Barnard Castle in County Durham and at Irvine and Montrose were assessed as locations for the facility.

The company may double investment on the Ulverston site to £700 million if there is a further improvement in the "environment for innovation". There are currently 240 Glaxostaff at Ulverston involved in the manufacturing of key ingredients for antibiotics.

Chief executive Sir Andrew Witty said the patent box, which introduces a lower rate of corporation tax on profits generated from UK-owned intellectual property, transformed the company's view of the UK as an investment location.

He said it ensured that the "medicines of the future will not only be discovered, but also continue to be made here in Britain".

The additional £100 million of funding at the company's two sites in Scotland includes the production at Montrose of the key materials for Glaxo's portfolio of respiratory medicines.

It will also be the first of Glaxo's UK sites to participate in the company's vaccine manufacturing supply chain.

At Irvine, Glaxo will increase production capacity for antibiotics as it looks to keep pace with growing demand in emerging markets.

There will be £80 million invested at its sites in Ware in Hertfordshire, to increase manufacturing capacity for its next-generation respiratory inhalation device, and at Barnard Castle, to establish a dermatology manufacturing centre of excellence.

Sir Andrew added: "We are also actively considering other investments in our UK manufacturing network which would create further jobs and reinforce the UK's international competitiveness and as a world leader in life sciences."

Chancellor George Osborne welcomed the announcement, citing it as proof the Government was improving the country's economy.

"You have GlaxoSmithKline, one of the world's biggest companies, one of the great British success stories, saying the Budget has changed their view of Britain as a place to invest," he told BBC Breakfast.

"They're going to create a thousand jobs here. Now, surely my responsibility as the country's Chancellor is to get the economy moving, to get jobs created, and when big companies say that about Britain, people should sit up and notice that we are changing the British economy for the better."

The leader of Cumbria County Council, Eddie Martin, said: "This is fantastic news for Cumbria and I'm delighted that GSK have recognised not only the broad and specialised skill base we have here, but also that Cumbria is a fantastic place to live and do business.

"They're setting up shop in a wonderful part of the world and it's the best bit of news for the Cumbrian economy we've had in recent years."

Peter Hornby, the county councillor for Ulverston East where the new factory will be situated, said: "I couldn't be happier if I'd just been told I'd won the lottery.

"The investment and jobs that GSK is bringing into Ulverston and Cumbria through the construction and ongoing operation of this new plant will make it a linchpin of the local economy.

"It's some of the best news the town has ever had."

Prime Minister David Cameron said: "This is excellent news, a major investment that will create many highly-skilled jobs and provide a great boost to the economy.

"It shows why we are right to cut business tax and focus on making the UK a dynamic and competitive place that can attract exactly this type of high-tech investment.

"We have a world-class life sciences industry, and I am determined not just to keep it here in the UK but significantly increase it too.

"We cannot be complacent. The industry is changing, and we must change with it. Our innovative life sciences strategy and ground-breaking patent box are already making a difference, helping to grow this important industry and ensure the great discoveries of the next decade happen here in British laboratories."

Labour science and innovation spokesman Chi Onwurah said: "It is excellent news that GSK will be investing in UK research and manufacturing.

"GSK has said that the Patent Box, introduced by Labour in the 2009 Pre-Budget Report, was a major factor in this decision and that the level of investment could yet double if there are 'improvements in the environment for innovation'. But even Vince Cable admits that, two years in, this Government lacks a compelling vision for British science and innovation.

"The UK has a real competitive advantage in the life sciences sector, so it's a shame that BIS (the Department for Business) have cut the budget for the Office for Life Sciences - also established in 2009 - and cut its staff by half.

"The Government now needs to urgently introduce an active strategy for innovation and science. Reintroducing Labour's long-term framework for science investment and genuinely protecting the science budget would be a good start."

ater the Prime Minister was given a tour of the Glaxo site in Ulverston, Cumbria, by the firm's chief executive, Sir Andrew Witty.

The hi-tech manufacturing and laboratory complex makes antibiotics and the 240 workforce will expand by another 350 after today's announcement to expand the site.

Mr Cameron added: "It's an enormous vote of confidence in the United Kingdom and in the workforce here."

PA