Pharmaceutical company GlaxoSmithKline (GSK) will create about 1,000 jobs in the UK and plans to invest £500m in new plants and research sites after the government pledged support for a new tax incentive to promote innovation.
As the UK government is poised to publish a plan for a "patent box" tax scheme, which will slash the rate of corporation tax on profits generated from UK-owned intellectual property, GSK was looking to develop new technology, build new facilities and invest in fledgling companies.
The drug-maker's plans included developing its first new manufacturing facilities in the UK for 25 years, expansion of a respiratory drug plant in Hertfordshire and building a UK biopharmaceutical manufacturing plant.
GSK said the successful implementation of the patent box, scheduled for 2013, will enable it to set up a new £50m UK venture capital fund for early stage healthcare companies and a new carbon-neutral laboratory at the University of Nottingham.
GSK chief executive Andrew Witty said, "In the current challenging and uncertain economic environment, this is a welcome step by the government to improve the attractiveness of the UK as a place for the private sector to locate and invest.
"This will lead to the UK moving to the top of the list in terms of where we would want to think about investing," he added.