US-based Pall said its aim was to meet the increasing demand for its technologies by pharmaceutical and biotechnology companies.
In all, the biopharmaceutical industry spends at least $800m if not more each year on filters and filtration equipment.
"Expanding our operations in Puerto Rico is an important part of our strategic approach of aligning with customers worldwide and increasing production in lower tax rate jurisdictions," said Eric Krasnoff, chairman and CEO of Pall.
"This expansion is another step in the standardisation and consolidation of our global manufacturing footprint."
The Company anticipates that Puerto Rico's competitive tax rate combined with its facilities optimisation program will result in an incremental after tax benefit of more than $10m annually in three years.
"Puerto Rico's attractive business climate and strong commitment to developing biopharmaceutical manufacturing capability are key factors in bringing numerous drug and biotechnology companies to the island," said Krasnoff.
Pall's BioPharmaceuticals business, which represents 15 per cent of total sales, has been growing - total revenues for 2006 were $2bn - as an increasing number of drugs go into production.
It expects to invest in facilities, machinery and equipment and add more than 250 full-time jobs in Puerto Rico by 2010.
The bioprocessing microfiltration and ultrafiltration business is dominated by two large multinational companies; Millipore, which is now only servicing the biopharmaceutical and research industries, and the biopharmaceutical segment of Pall Corporation.