GlaxoSmithKline invests US$360 mln in post-Brexit UK manufacturing
LONDON: GlaxoSmithKline plans 275 million pounds (US$361 million) of new investments at three drug manufacturing sites in Britain, signalling its confidence in the country despite last month’s vote to leave the European Union.
Britain’s biggest drugmaker, which had argued against Brexit before the referendum, believes the UK remains an attractive place for making medicines, thanks to a skilled workforce and relatively low tax rates.
The country’s so-called patent box boosts profits from patented innovations by halving the rate of corporation tax.
This tax relief, which favours pharmaceutical companies, has come under fire in recent days from the opposition Labour Party.
GSK said on Wednesday it was investing in sites at Barnard Castle, in the north of England, Montrose, in Scotland, and Ware, north of London.
It plans to increase production of next-generation respiratory drugs and biotech medicines.
The vast majority of these products will be exported.
“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,” said Chief Executive Andrew Witty.
The company, which will report quarterly results at 1100 GMT, has a large part of its global research and manufacturing cost base in Britain, even though nearly all its sales are generated overseas.
Witty, who is retiring next year, had said before the vote that Britain should remain in the EU, due to fears that Brexit could disrupt drug regulation and hamper access to top scientific talent.
But despite this the company, which will be helped by recent falls in sterling, has concluded that the country remains a good place to do business.
Its decision will be welcomed by the government, which is keen to show Britain is open for business post-Brexit.
The pharmaceuticals industry is a notable success story for Britain, directly employing more than 70,000 people and accounting for 25 percent of all business research and development spending.
GSK itself e m p l oy s approximately 6,000 people at nine different UK sites and the group said its new investment would support current employment, while also likely leading to the creation of new jobs. — Reuters