Glaxo could build £300m factory in Barnard Castle, Teesdale Mercury

DRUGS company GlaxoSmithKline is considering building a £300million plant in Barnard Castle – a move that would create hundreds of jobs.

Glaxo last week announced plans for its biggest investment in the UK for more than a decade, including developing its first UK-based biopharmaceutical factory.

The firm has confirmed that its Barnard Castle base is one of three sites being considered as a location for the new £300million plant.

Industry insiders said the final decision on the site’s location is expected next year.

Claire Brough, a spokeswoman from Glaxo’s HQ in London, said: “Barnard Castle is being considered along with Stevenage and Ulverston.

“The decision will be made based on where the skills are and in terms of the current capability of the sites.”

The company said the number of jobs that would be created is not yet known. However, Glaxo said the figure would be “in the hundreds”.

“It will depend on whether existing jobs would be able to transfer across or whether we would be creating new jobs,” the spokeswoman said. 

Glaxo is Teesdale’s largest employer, with about 1,000 people working at the 60-acre Harmire Road site.

Last December, the site was rocked by news that Glaxo would make 200 staff redundant to save cash.

That year, chief executive Andrew Witty warned that the industry faced challenges as an increasing number of products lost patent protection.

Before last week, experts were predicting that Glaxo was planning to build its biopharma plant in either Singapore or the US.

Glaxo said it had now decided to invest the money in the UK after the government last week proposed to slash tax on profits made from UK patents.

The government’s so-called “patent box” scheme will not take effect until 2013, but Glaxo chief executive Andrew Witty said it would still influence investment decisions made today.

Mr Witty said: “For GSK, assuming the new regime will apply to patents currently under development it will have the immediate impact of making the UK a priority area for future investments, particularly in manufacturing.”

Biopharmaceutical medicines are made from living organisms. Glaxo currently has six biopharma drugs that are being developed for treatment of diseases such as lupus and diabetes.

If Barnard Castle is selected for the investment, products that could be developed there include Arzerra, for leukaemia, and Syncria, for type two diabetes.

Experts say the factory’s development would ensure that the UK becomes the home of the latest generation of biological medicines.

The news of the possible investment in Barnard Castle follows Glaxo’s recent plans to expand production of skin care products in the town.

Teesdale’s MP, Helen Goodman, welcomed the £300m proposals.

She said: “This could give a further and welcome boost to the Barnard Castle plant.

“I have every confidence in the skill of the local workforce and the management, and I really hope that GSK decide to build the new site in Barnard Castle.”

Lord Mandelson, the Business Secretary, described Glaxo’s spending proposals as “excellent news”.

A spokeswoman for Glaxo in Barnard Castle said: “Barnard Castle is likely to be one of several locations to be considered given the similar technologies in use at the site and the technical expertise of staff .” But the spokeswoman said a decision was “not likely in the short term”.

However, she added: “We are always looking at new options at Barnard Castle and to be up there with the best is absolutely great. Fingers crossed, the investment will come our way.”