GlaxoSmithKline investing £275m in UK manufacturing sites
GlaxoSmithKline has brushed aside Brexit jitters and announced that it is pumping £275 million into its three UK manufacturing sites, dubbing the UK an "attractive location".
The investment will go to sites at Barnard Castle, Durham, Montrose, Scotland, and Ware in Hertfordshire, and GSK said "new employment opportunities" are expected to be created as a result.
Chief executive Andrew Witty said that the UK's "competitive corporate tax system" and skilled workforce helped the pharmaceutical giant come to its decision.
Mr Witty, who backed the Remain campaign during the referendum, said: "Today's announcement reflects further investment to support our pharmaceutical pipeline and meet growing demand for our innovative portfolio of newly launched products.
"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. From their manufacture in the UK, many of these medicines will be sent to patients around the world."
Business and Energy Secretary Greg Clark said: "An investment of this scale is a clear vote of confidence in Britain and underlines our position as a global business leader.
"GSK's recognition of our skilled workforce, world leading scientific capabilities and competitive tax environment is further proof that there really is no place better in Europe to grow a business."
Sir Andrew Witty said GSK had opposed Brexit because of the "regulatory uncertainty" it would create for the sector, but said this concern "was not sufficient to get in the way of the decision to invest".
While GSK may have to deal with "double the amount of regulation" if the UK decides to set up its own regime alongside the EU system, Sir Andrew said he did not expect a sharp change in the company's decision on locations for investment as a result of Brexit.
"Over the medium run - assuming the outcome on the regulatory regime change is not unnecessarily disruptive - I would expect our overall footprint to broadly continue as it is, with the very substantial proportion in the UK," he told BBC Radio 4's World At One.
Sir Andrew said the UK was still in a "phoney war" situation, as it remained unclear what consequences there would be from the renegotiation of its relations with Europe.
Most businesses would probably be "thoughtful" about medium-term investment decisions until they get "more clarity about the outcome of negotiations", he said.
But he cautioned the Government against rushing into negotiations by swiftly triggering Article 50 of the Lisbon Treaty.
"I don't think it's important when we start the process," said Sir Andrew. "I think it's important when we finish and the quality of what comes out of the negotiation. If I had any advice to the Government, it would be don't rush to start the race and don't put unnecessary time pressure on yourselves in the negotiation."
The news came as GSK reported that second-quarter operating profit rose 15% to £1.83 billion as sales of new products more than doubled. Group sales increased 4% to £6.53 billion with growth across pharmaceuticals, vaccines and in consumer healthcare.
Sales were driven by HIV drugs Tivicay and Triumeq, respiratory drugs such as Relvar/Breo and meningitis vaccines including Bexsero. The company said the growth offset the decline in sales of blockbuster drugs like Advair.