The planned closure of a plant that makes the main treatment for coronavirus in Australia has been shelved to meet pharmacy shortages.
The planned closure of a plant that makes the main treatment for coronavirus in Australia has been shelved to meet pharmacy shortages.

Plant that makes COVID-19 treatment delays closure

Plans to close a medicines factory in Sydney's north west with the loss of more than 200 jobs have been temporarily shelved as COVID-19 demand for analgesics such as Panadol forces a production ramp up.

Pharmaceutical giant GlaxoSmithKline had announced the closure of its Ermington plant back in 2016 and had gradually been dismantling production lines and machinery for full closure by July this year.

But the coronavirus pandemic and a surge in demand to meet chemist shelf shortfalls nationally has now forced the company to go back online and in fact increase production of common medicines like its adult Panadol range and children's analgesics.

The GSK Panadol factory in Ermington northwest Sydney was slated for closure and the loss of 240 jobs in July. Picture: Supplied
The GSK Panadol factory in Ermington northwest Sydney was slated for closure and the loss of 240 jobs in July. Picture: Supplied

GSK's Melbourne Boronia plant, due for expansion, has also had to undergo increased production.

The decision to now keep the plant open, albeit temporarily, was only made on April 1 with no closure date specified as executives watch the continuing COVID-19 crisis unfold and produce demand remain high.

The four-year phased closure had already seen machinery transferred to other GSK plants in Australia and overseas as well as a sell-off to third party contract manufacturers all of which has now been halted or reversed.

"It's been an incredible job, the staff have done an incredible job," GSK Consumer Healthcare general manager ANZ Anish Patel said of the plant's ability to go back to peak production.

The GSK Panadol factory in Ermington northwest Sydney makes Panadol. Picture: Supplied
The GSK Panadol factory in Ermington northwest Sydney makes Panadol. Picture: Supplied

 

"We're very pleased that we have been able to extend the operation of our Sydney factory to increase local production in response to the current situation.

"We would like to acknowledge the agility and resilience of the team at our Sydney site who are working tirelessly to make this possible. Their focus and dedication to support our customers is the reason we can make important changes that allow us to continue to support people who need our products during this unprecedented time."

The Ermington plant was earmarked for closure after 60 years operation after a review found much needed modernisation would no longer make it cost effective.

High labour costs also made it uncompetitive compared with lower cost bases in China and India.

Children's Panadol that is produced at the GSK Ermington plant. Picture: Supplied
Children's Panadol that is produced at the GSK Ermington plant. Picture: Supplied

At its peak the plant, sitting on the banks of Parramatta River on a more than 52,000 sqm prime parcel site, had 400 staff but by closure was down to 240.

Average annual products manufactured there had a worth of about $240 million with more than 67 million packs or 2 billion tablets produced there.

Geraldine Hughes, Ermington site director, said: "By keeping the key parts of the factory operational, we will be able to retrain and redeploy our personnel, who would have otherwise left the business, to run those areas. So they gain extra skills, we get Panadol to consumers and we have additional time to continue our comprehensive programme of educational courses that are helping our people to be market ready and assist with job placements."

Originally published as Plant that makes COVID-19 treatment delays closure


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