GlaxoSmithKline PLC (GSK) plans ￡275 million (US$361 million) of new investments at three drug manufacturing sites in Britain, signaling its confidence in the country despite last month’s vote to leave the EU.
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 favors pharmaceutical companies, has come under fire in recent days from the opposition Labour Party.
GSK yesterday said 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, who is retiring next year.
GSK has a large part of its global research and manufacturing cost base in Britain, even though nearly all its sales are generated overseas. The company has concluded that the country remains a good place to do business.
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 employs about 6,000 people at nine UK sites and the group said its new investment would support current employment, while also likely leading to the creation of new jobs.
Witty, together with AstraZeneca PLC CEO Pascal Soriot, chairs an industry task force set up by the government to address regulatory and other issues facing the pharmaceutical sector following Britain’s decision to leave the EU.
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