The British company announced today it intends to close its tablet packaging facility in Boronia, Melbourne as part of a business transformation in which it is to refocus its strategy to higher technology manufacturing.
GSK Australia spokesperson, Lisa Maguire, told Outsourcing-Pharma.com that while “it is intended that the solid dose (tablet) packaging activities at Boronia will be transferred to other GSK sites,” there would also be a transfer of manufacturing to “local external manufacturing contractors and Aspen.”
GSK last year sold a number of its Australian non-core brands to South-African based Aspen, of which it has a 16 per cent stake. Aspen currently has four manufacturing sites in Australia.
When asked if this was a trend towards packaging outsourcing as a whole, MacGuire replied in the negative, confirming GSK’s own facilities in Aranda, Spain and Pozan, Poland would be picking up some of the manufacturing fallout.
Currently, it is estimated that GSK spends £9bn ($13bn) a year on outsourcing, with 10% of this going on manufacturing.
The Melbourne site will turn its attention to higher end manufacturing including its Blow Fill Seal - a container for sterile liquid medicines - and Rotacap, a distribution device for respiratory medicines.
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Maguire added that the closure was mainly due to the rising costs in manufacturing in Australia with wages specifically being a burden. The Australian dollar has been at a thirty year high against its American counterpart for several years, meaning exports have been uncompetitive across all industries, not just pharma.
The news will come as a blow to approximately a third of the 363 employees at Boronia will be made redundant, though the timescale of the redundancies has not been confirmed as GSK are in the process of accounting for regulatory requirements of affected markets.