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GSK cancels plans to build biopharmaceutical facility in Ulverston

Artist’s impression of the new GSK biopharmaceuticals plant in Ulverston

[G]SK today set out several announcements made by the company to improve the efficiency and competitiveness of its manufacturing network. These include both investments for respiratory and HIV medicines manufacturing in the UK and strategic reviews, including the sale of several products and a proposal to close a UK manufacturing site.

Between now and 2020, the Company plans to invest more than £140million at its Ware, Hertfordshire, Barnard Castle, Co Durham and Montrose, Scotland sites. The investments will support expansion of manufacturing for respiratory and HIV medicines. This new investment is in addition to the £275million announced last year and investment of over £1.2billion in UK manufacturing since 2012.

In pharmaceuticals, the company is to undertake a strategic review of its cephalosporins antibiotics business, with an option to sell the business including the associated manufacturing facilities. These medicines are produced at GSK sites in Ulverston, Cumbria, Verona in Italy and part of its Barnard Castle site.

The Company has also decided to outsource some manufacturing activity at its Worthing site in the UK. GSK will continue to manufacture other antibiotics such as Augmentin and will continue to conduct research on new antibiotics.

The company has also decided not to proceed with a previously planned investment to build a biopharmaceutical facility in Ulverston as it no longer needs the additional capacity.

In its Consumer Healthcare business, the company intends to sell its Horlicks brand in the UK and is proposing to close the associated manufacturing site in Slough where UK product is made. In addition, GSK intends to sell the MaxiNutrition brand in the UK.  GSK is also exploring options to divest some other smaller non-core nutrition brands.

Overall, GSK employs a total of around 17000 people across the UK of which 5000 are in UK manufacturing operations.

The proposals announced today for Worthing and Slough will result in a reduction of approximately 320 permanent jobs over the next 4 years.

Roger Connor, President, GSK Global Manufacturing and Supply said: “We have a substantial manufacturing presence in the UK and continue to support the network with new investment of more than £140million in the next 3 years. At the same time, we have had to make some decisions which we know will cause uncertainty for some of our employees. We will do all we can to support them through this process.”

Philip Thomson, President, Global Affairs, GSK, said: “We are continuing to invest in science and our core businesses in the UK and we continue to see the UK as an attractive place for the life sciences industry. We are working constructively with the Government and others to develop an ambitious plan for the sector as part of the UK’s new industrial strategy.”

None of the announcements made today by the company have resulted from the UK’s decision to leave the European Union.

Today’s announcement that GSK is pulling out of its planned investment at the Ulverston site has been met with ‘shock and disappointment’ by South Lakeland District Council (SLDC).

SLDC’s portfolio holder for the economy, Councillor Graham Vincent, said the news the company was not going to proceed with its previously planned investment was a blow, but stressed the authority’s immediate concern now was to understand the implications for the future of the current site and the existing GSK employees in Ulverston.

Councillor Vincent said: “We are shocked and disappointed to see today’s announcement from GSK.

“We have been in meetings and discussions with GSK in the last few weeks about unrelated matters and there was no suggestion that this announcement was on the horizon.

“Our chief executive has this afternoon spoken with management at GSK to seek more information from the company about the existing site and the staff in Ulverston, for who this must be a very worrying and uncertain time.

“We understand that there will be no immediate impact  on the existing workforce and we are fully committed to doing all that we can to assist GSK, its staff and the wider Ulverston community.

“We will work with the company, the local MP, town, county and district councillors and Cumbria LEP to offer whatever support is necessary.

“We have been told by the management at GSK in Ulverston that the site remains very profitable and, should one of the future options be to look at selling the Ulverston operation, that it would be an attractive proposition for any potential purchaser.

“We have given our assurances that if they do look to sell the site that we will do all that we can to support them in finding a buyer to ensure the ongoing operation of the facility.’’

Commenting on the announcement, Tim said: “This is a massive blow for the South Lakes, and shows just how much the Government has taken its eye off the ball over the last two years.  Any Government worth its salt should have seen this coming – and for the Northern Powerhouse to mean anything they should be working with companies like GSK to secure investment here in Cumbria.

“I was proud when Vince Cable, then Liberal Democrat Business Secretary, and the late Brendan Jameson, then Liberal Democrat leader of South Lakeland District Council, worked with GSK to secure the planned expansion in 2012.  This Government has failed to show anything like the same level of commitment to our area.”

Tim has also contacted GSK to seek clarification on the future of the current site.

He continued: “Many residents both directly and indirectly employed by GSK will be nervous about the prospect of the site being sold off.  I am seeking clarification on the likely impact of the workforce if the site is sold off, and am keen to work with neighbouring MPs and the local council to secure the future of the site going forwards.”

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