Post-Brexit, GlaxoSmithKline Eyes Jobs Boost With $360 Million Investment in Three UK Manufacturing Sites

Post-Brexit, GlaxoSmithKline Eyes Jobs Boost With $360 Million Investment in Three UK Manufacturing Sites July 27, 2016
By Mark Terry, BioSpace.com Breaking News Staff

Undeterred by the British vote on June 23 to leave the European Union (EU), the so-called “Brexit,” UK-based GlaxoSmithKline announced it is investing $360 million (275 million pounds) in UK-based facilities.

GSK already has nine manufacturing facilities in the UK that employ about 6,000 people. The new investment will be in three locations, Barnard Castle in County Durham, Montrose in Angus (Scotland), and Ware in Hertfordshire.

The Barnard Castle location is the company’s second largest manufacturing site and currently employs 1,100 people. It will receive 92 million pounds to build an aseptic sterile facility.

The Montrose in Angus site manufactures active ingredients for respiratory, HIV and vaccine products. It currently employs more than 450 people. It will receive 110 million pounds for a new state-of-the-art manufacturing facility for respiratory active ingredients.

The Ware site currently employs 1200 people and manufactures respiratory products. It will receive 74 million pounds to continue expansion of its new Ellipta respiratory inhaler.

“Today’s announcement reflects further investment to support our pharmaceutical pipeline and meet growing demand for our innovative portfolio of newly launched products,” said Andrew Witty, GSK’s chief executive officer, in a statement. “It is testament to our skilled UK workforce and the country’s leading position in life sciences that we are making these investments in advanced manufacturing here. From their manufacture in the UK, many of these medicines will be sent to patients around the world.”

Although GSK has a strong manufacturing presence in the UK, the majority of its drugs are sold elsewhere. Prior to the Brexit vote, Witty had argued that the UK should stay in the EU, saying that the exit would cause problems with Europe’s consolidated system for drug regulation, and cause difficulties in gaining access to scientific talent. In addition, the European Medicines Agency (EMA), the European Union’s equivalent to the U.S.’s Food and Drug Administration (FDA)) is headquartered in London.

Both Witty and Pascal Soriot, chief executive officer of UK-based AstraZeneca , chair a task force implemented by the government to focus on regulatory and related issues that the pharmaceutical industry will have to deal with after the Brexit vote.

Scotland’s Minister for Business, Innovation and Energy, Paul Wheelhouse, told the BBC that “GSK is a hugely important contributor to our economy so this is fantastic news for Montrose, for Scotland and for our life sciences industry. Life sciences is a vital industry in Scotland, employing more than 35,000 people, and as we’re seeing, one which is a world leader. This success is built on our strong academic base and the cutting edge research going on across Scotland.”

Part of the appeal in British manufacturing, despite the Brexit, for GSK, is the country’s skilled workforce, relatively low tax rates, and various incentives for investing in research. At the moment, with pound sterling dropping, products that sell primarily abroad is also a benefit. Sterling has dropped 10 percent against the U.S. dollars and the euro since the Brexit referendum.

The investment in expanding the facilities is expected to create jobs in construction, as well as new jobs for GSK. No specifics on the number of jobs to be created were announced.

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