GSK is poised to slash its back office headcount to help fund a £400m mega-campus in Cambridge, in a move it hopes will bolster its drugs pipeline and stave off a looming patent cliff edge.

In his first major strategy update as chief executive, Luke Miels unveiled plans for the new 300,000 square foot site that will become the new home for its research and development arm and host more than 1,000 GSK scientists.

The group is expected to launch a sweeping round of layoffs to help fund the investment and support the firm’s operating margin.

Miels hailed the move, which will see it vacate its Stevenage research and development (R&D) site for Cambridge by 2029, as a shot in the arm for the FTSE 100 giant, which has lagged behind London-listed rival Astrazeneca and US peers in recent years.

“This investment will accelerate our R&D and help us deliver new, competitive products,” he said. “It integrates GSK further into one of the world’s leading centres of knowledge and demonstrates the attractiveness of the UK’s life sciences ecosystem.”

The bumper investment is the latest sign of a patching up of relations between the ministers and the UK’s world-leading pharmaceutical industry. At the start of this year, a string of major players including Astrazeneca and German juggernaut Merck axed expansion programmes worth billions of pounds in a spat with the government over the NHS’s pricing regime.

But in February, former science minister Patrick Vallance struck a deal for the taxpayer to fork out an additional £1bn on drug prices, which in turn prompted Astrazeneca to revive plans to plough £300m into the UK economy. The agreement also alleviated pressure on the government from President Donald Trump, who had been threatening to slap enormous tariffs on the UK’s pharma exports unless the country started paying more for its drugs.

GSK ramps up phase three trials

GSK’s new campus marks the first major strategic announcement from new boss Miels, who took over from veteran chief executive Emma Walmsley, who stepped down at the end of last year. The FTSE 100 giant had struggled to keep pace with rivals, with shareholders nervous about an impending patent loss on one of its most lucrative drugs.

The patent on GSK’s HIV dolutegravir franchise is poised to expire from 2028, leaving the group facing a hole in its forward earnings. In its eagerly anticipated update on Tuesday, Miels unveiled a major investment drive in late-stage trials, focusing on programmes the group believes will have the most growth potential. The London-listed firm will double its phase-three trials this year from 10 to 20, in a major ramping of the pipeline.

In a bid to help fund the parallel investment programmes, the group has lined up plans for sweeping redundancy programmes in less profitable segments. The job losses are expected to come from back of office roles like human resources and shifting staff from general medecine arms to support faster growing parts of the business.