GSK confirms significant investments in UK manufacturing: Ulverston in Cumbria selected as site of new biopharmaceutical factory

Issued: London UK

• In total more than £500m of investment confirmed, creating up to 1,000 new jobs
• Includes £100m investment for GSK manufacturing in Scotland
• Options for further significant investment in UK manufacturing also under consideration

GSK today confirmed that it will invest more than £500m in the UK 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 will also be made at the company’s two manufacturing sites in Scotland at Montrose and Irvine.  In total, it is anticipated these investments will create up to 1,000 new jobs over the lifetime of the projects and will also benefit the wider construction industry and the many companies which supply GSK with services and facilities in the UK. 

These investments represent one of the largest commitments to the UK life-sciences sector in recent years.  They follow confirmation by the Government in the Budget yesterday that it will 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.  

GSK’s CEO Sir Andrew Witty said: “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. 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 1,000 new jobsover 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.” 

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.”

Scottish Secretary Michael Moore said: "The £100m investment in Irvine and Montrose is fantastic news for these communities and our life science sector. The tax measures announced by the Government are attracting investment and creating jobs. The new patent box and further reductions in corporation tax make Scotland and Britain a great place for companies like GSK to invest. Ayrshire and Angus have a proud track record in making life enhancing medicines and vaccines. This is a massive vote of confidence in their highly skilled staff. It is also a confirmation that the Government are creating the right tax environment for companies to do business."

Site selected at Ulverston for new £350m biopharmaceutical manufacturing facility

Following an extensive feasibility study conducted through 2011, GSK today announced that the location for its new state-of-the-art biopharmaceutical manufacturing facility will be Ulverston, Cumbria.  Approximately £350m has been earmarked for its construction.  Four existing GSK sites across the UK were assessed – Barnard Castle and Ulverston in the North of England, and Irvine and Montrose in Scotland – with examination 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 now begin, with an anticipated start date for construction of 2014/15 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.  

GSK also announced today it is considering further significant manufacturing investment at Ulverston which could double the total investment at the site to approximately £700m and create further jobs in the longer term, depending on continued improvements in the environment for innovation in the UK. 

More than £100m investment confirmed for GSK manufacturing in Scotland

GSK also announced that it will invest more than £100m across its two manufacturing sites in Scotland.  This 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, which are high-tech agents used in the manufacture of vaccines to help stimulate the body’s immune system.  GSK is the world’s largest vaccine company and this is 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 totalling £80m at its sites in Ware in Hertfordshire to increase manufacturing capacity for its next-generation respiratory inhalation device and at Barnard Castle in County Durham to establish a dermatology manufacturing centre of excellence.

Notes to editors:

GSK employs around 15,000 in the UK, including almost 6,000 in manufacturing.  GSK is also the largest private sector funder of R&D in the UK. 

GSK’s Ulverston site currently employs around 240 people and manufactures key ingredients for antibiotics.  GSK has six biopharmaceuticals in late-stage development for treatment of diseases such as lupus and diabetes and biopharmaceuticals represent approximately 20% of GSK’s overall clinical pipeline. 

Other recent commitments GSK has made to the UK’s manufacturing and science base include:

• VC Fund: GSK has launched a £50 million UK Venture Capital Fund. This fund is focussed on investments in early stage healthcare companies and spin outs from academia in the UK which are pursuing innovative, breakthrough science.  To date, we have invested in Mission Therapeutics, a Cambridge-based start-up company.
• Green technology: Plans remain on track to construct a new facility at the University of Nottingham focused on the development of ‘green chemistry’ technology, with a significant financial contribution from GSK to this project.  The facility will both support academic teaching and encourage related IP research and development in the field of green chemistry. 
• Graduates: GSK has announced plans to reimburse 100% of uncapped tuition fees for students recruited under the company's graduate scheme from 2015.
• Apprenticeships: GSK recently launched a new multi-disciplinary UK Apprenticeship scheme, aimed at 16-24 year olds offering positions at the company’s UK manufacturing, R&D and corporate sites.

Artist's impressions of the new facility at Ulverston are available on GSK's Flickr photostream. 

GlaxoSmithKline - One of the world’s leading research-based pharmaceutical and healthcare companies – is committed to improving the quality of human life by enabling people to do more, feel better and live longer.  For further information please visit www.gsk.com.

Cautionary statement regarding forward-looking statements

Under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, GSK cautions investors that any forward-looking statements or projections made by GSK, including those made in this announcement, are subject to risks and uncertainties that may cause actual results to differ materially from those projected. Factors that may affect GSK' s operations are described under 'Risk factors' in the 'Financial review & risk' section in the company's Annual Report 2011 included as exhibit 15.2 to the company's Annual Report on Form 20-F for 2011.