Glaxo will build in UK after Budget initiative

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

The proposed biopharmaceutical facility at Ulverston in Cumbria is part of £500m 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 £350m project at Ulverston was 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 £700m if there is a further improvement in the “environment for innovation”. There are currently 240 Glaxo staff 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 £100m of funding at the company’s two sites in Scotland includes the production at Montrose of the key materials for Glaxo’s respiratory medicines.

At Irvine, Glaxo will increase production capacity for antibiotics.

There will be £80m invested at its sites in Ware in Hertfordshire, to increase manufacturing capacity for its inhalation device.

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