GlaxoSmithKline Plans Biopharmaceutical Manufacturing Investment in the UK

GlaxoSmithKline (GSK) plans to invest more than £500 million ($798 million) in the United Kingdom across its manufacturing sites to increase production of key active ingredients for its pharmaceutical products and vaccines. The company announced selection of Ulverston in Cumbria as the location for the first new GSK manufacturing facility to be built in the UK for almost 40 years. Investment also will also be made at the company’s two manufacturing sites in Scotland at Montrose and Irvine.

GSK’s announcement follows plans by the UK government to implement a “patent box” to encourage investment in R&D and related manufacturing in the UK by introducing a lower rate of corporation tax on profits generated from UK-owned intellectual property. “The introduction of the patent box has transformed the way in which we view the UK as a location for new investments, ensuring that the medicines of the future will not only be discovered, but can also continue to be made here in Britain,” said GSK’s CEO Andrew Witty, in a Mar. 22, 2012, statement. “Consequently, we can confirm that we will build GSK’s first new UK factory for almost 40 years and that we will make other substantial capital investments in our British manufacturing base. In total, this will create up to 1000 new jobs over the lifetime of the projects. 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.”

Following a feasibility study conducted through 2011, GSK said it will locate a new £350 million ($559 million) biopharmaceutical manufacturing facility in Ulverston, Cumbria. Four existing GSK sites across the UK were assessed—Barnard Castle and Ulverston in northern England and Irvine and Montrose in Scotland—with consideration of factors such as sterile-processing skills, technical capability, and existing links with local suppliers and academic partners. Detailed planning and design of the new facility will begin now with an anticipated start date for construction of 2014–2015, dependent on portfolio timing and obtaining necessary planning and related consents. Once construction starts, it is likely to take at least six years before the plant is fully operational, according to GSK.

Other investments:

GSK announced it is considering further significant manufacturing investment at Ulverston which could double the total investment at the site to approximately £700 million ($1.1 billion). GSK also announced that it will invest more than £100 million ($160 million) in its two manufacturing sites in Scotland. This investment includes new funding at Montrose to enable the manufacture of key materials for GSK’s portfolio of respiratory medicines. Investment will also be made at Montrose to produce aluminium adjuvants used in the manufacture of vaccines. This investment will be the first time a UK GSK site will participate in the company’s vaccine-manufacturing supply chain. At Irvine, GSK will increase production capacity for antibiotics, reflecting growing demand for these medicines in emerging markets.

GSK will also invest in sustainable green-energy production and environmentally friendly manufacturing technologies at both sites. The company is making other investments totaling £80 million ($128 million) at its sites in Ware in Hertfordshire to increase manufacturing capacity for its respiratory-inhalation device and at Barnard Castle in County Durham to establish a dermatology-manufacturing center of excellence.

Overall, GSK employs around 15,000 people in the UK, including almost 6000 in manufacturing.