Working back to health

Ciara Leeming continues our series on the impact of the downturn in manufacturing across the North West, this week looking at GlaxoSmithKline's closure on Merseyside

When drug giant Glaxo Wellcome and rival SmithKline Beecham merged to form Glaxo SmithKline (GSK) in 2000, there were inevitably going to be losers.

It was not long before the 700 workers at Glaxo's Speke Boulevard factory learned they would be among them.

They expected 200 redundancies, but plans to close the Merseyside plant came as a shock.

Following a global review of operations, bosses warned the factory would close by mid-2004.

Glaxo claimed asthma inhalers made at Speke were out of date, as medicine moved towards powder treatments. It made similar drugs at its plants in Spain and France.

The announcement was a setback for Liverpool – the drug industry's self-styled European capital. Speke was – and remains – home to the highest concentration of biomanufacturing firms on the continent. Glaxo opened six decades previously, and had produced asthma drugs since 1993. The Boulevard Industry Park is home to vaccine manufacturer Chiron and US drug giant Eli Lilly, as well as an extensive automotive supplier and manufacturing park dominated by Jaguar.

Glaxo workers fought the decision during the six-month consultation. They took to the streets to protest in a campaign led by the trade unions USDAW (the Union of Shop, Distributive and Allied Workers) and MSF (Manufacturing, Science and Finance).

MP Maria Eagle, for Garston, met with the firm's UK directors, and she and her colleagues begged the Department for Trade and Industry to get involved.

Crosby MP, Claire Curtis-Thomas, feared for the sector: "We were deeply concerned about the future of the pharmaceutical and chemical industry in the North West.

"There had been a significant reduction in investment in the last few years and I felt the closure of a manufacturing facility would mean a further reduction in investment."

For many, Glaxo's huge profits were a bitter pill to swallow. Trading figures show sales of GSK's respiratory drugs – made at Speke – soared by 36% to £871m during this period.

USDAW official Mike Aylward saw it as a betrayal: "This was not a company in crisis, not a Cammell Laird or Railtrack or Marconi.

"They could keep the site and still make a profit. That was even more galling."

Unions were given access to GSK's books and spent five months putting together a dossier in a bid to save the site.

"We analysed all the figures, risk assessments and forecasts and put together a very strong case for saving Speke," said Aylward.

But the firm dismissed them, saying their proposals did not add up.

Glaxo donated £1m towards education and training in the Speke and Garston area. More than 100 jobs is said to have been created – although no details are available on how or what kind of jobs.

The firm pledged a further £1m to pay for the retraining of its own employees – many of whom had given decades of loyal service.

During the long wind-down period, workers left in tranches until GSK switched off the production line in April 2004. Seventy staff – a tenth of the of the orginal workforce – stayed on until July to decommission the factory.

By that point, three-quarters of the firm's employees – many of whom were highly skilled – had either found new jobs, set up businesses, retired or returned to education.

A number were headhunted by employers around the North West and North Wales – often thanks to the efforts of GSK's human resources team, which contacted other drug companies on their behalf.

Moves by the NWDA to develop Merseyside's biotech industry also helped create a sense of optimism.

Following the closure, GSK's factory site was bought by developer New Capital Properties for £6.4m and renamed Southern Gateway, comprising 400,000 sq ft of industrial and laboratory space across 16.89 acres.

Drug firm Eli Lilly, based nearby, opened a small distribution centre there last year, and other tenants include tea maker Gold Crown Foods. Last November, the specialist inhalation building – which covers a fifth of the site – was put on the market, with interest coming from pharmaceutical firms. The building has proved popular with light industrial occupiers, and the owner hopes more than 1,000 workers could one day be based back on the site. Pharmaceutical production continues at Speke, regardless of GSK's closure.

Last year saw the opening of the new NWDA and DTI-backed £24m National Biomanufacturing Centre. The development created 80 new jobs and will put on training programmes with the Partnership for Learning and local universities.

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