Decision on new GSK plant location to come soon
The wait for the big pharmaceutical manufacturing decision in the U.K. is nearing an end. GlaxoSmithKline ($GSK) officials will decide by summer on which of four U.K. locations will be the site of a new biopharmaceutical plant that is part of a promised £500 million investment in GSK's home country, reports The Northern Echo.
It will be the first plant GSK has built in the the U.K. in 30 years. It was one of several promises made by the U.K.'s largest pharmaceutical company after the government offered so-called "patent box" legislation that would, beginning in 2013, cut to 10% the corporate tax rate on profits from products invented in the U.K.
GSK also has said it will launch a £50 million U.K. venture capital fund focused on investments in early-stage healthcare companies and spinoffs from U.K. universities. GSK has an existing fund that has invested more than $600 million in biotech companies, but through 2010, 70% of those investments had been made in U.S. companies. Additionally GSK said the tax break would "lead to the construction of a new facility at the University of Nottingham focused on the development of 'green chemistry' technology."
The four GSK locations vying for the new plant--as well as an expected 1,000 new jobs--are Ulverston and Barnard Castle, County Durham, in England and Irvine and Montrose in Scotland. The Scottish government has sweetened the pot by creating an Enterprise Zone in Irvine that would reduce local taxes and streamline the planning process if GSK selects that site.
When it started the process, GSK pointed out that a project like this can take 7 years or more from conception to commercial production.
The project is highly anticipated in a country that has lost thousands of pharmaceutical jobs over the years. Labor unions representing workers at facilities owned by London-based AstraZeneca, ($AZN), the U.K.'s second-largest pharma company, went on the offensive last week after that company announced plans to eliminate 7,300 jobs. The company did not say how much of the burden would fall on plants there.