The plant will be able to produce biologic drugs, which use natural products like blood or bacteria, and Singapore is one of the few countries in the world which has this capability.

The new plant - GSK chief executive officer Andrew Witty calls it 'possibly the best vaccine facility anywhere in the world' - will manufacture a new drug that has shown promise in preventing some of the most common lethal diseases around the globe such as meningitis, pneumonia and blood poisoning, which kill about one million toddlers each year.

Though the plant opened yesterday, production will begin only in 2011.

This is because of strict quality control standards for biologics plants: It will take about two years for teams of auditors from the health authorities around the world, including the United States Food and Drug Administration (FDA) and the World Health Organisation, to satisfy themselves that standards at Tuas are up to scratch.

Standards are so exacting, said the plant's site director, Mr Vincent Hingot, that it takes three weeks just to get a freezer approved.

Indeed, biologic drugs are so difficult and complex to produce that pharmaceutical companies needed some convincing that Singapore has what it takes to do so.

Speaking at the opening ceremony of the plant yesterday, Prime Minister Lee Hsien Loong said it marked a significant victory for the Republic.

Though drug companies initially questioned whether Singapore could make the transformation from producing run-of-the-mill drugs to making biologic vaccines, the country met the challenge via training and other measures, he said.

In fact, he added, four other companies have followed GSK's lead, and will build similar plants here.

In all, the plants - which will cost an estimated $3 billion - will employ over 1,000 highly-skilled workers, making Singapore the key biologics manufacturing location in Asia for global pharmaceutical and biotech companies.

Yesterday, GSK also announced that it was setting up a $30 million endowment fund for graduate studies in sustainable manufacturing processes, green chemistry and health policies.

Calling the $30 million 'very generous', Mr Lee said the Economic Development Board would top up the amount to the tune of $20 million. The fund will be a symbol of the cooperation between GSK and Singapore, he added.

Yesterday's announcements were the latest in a 50-year relationship between GSK and Singapore.

So far, this has resulted in a total investment of over $1.5 billion in fixed assets here by the British company, and employment for more than 1,000 people.

Singapore is one of GSK's global strategic manufacturing hubs and one of its 'most prestigious locations', said Mr Witty. He added: 'Jurong remains our most reliable facility in the world.'

Its performance, he said, 'earned' Singapore the new vaccine plant, since it gave the company the confidence to build the biologics facility here.

Yesterday, while lauding Singapore's success in landing the biologics plants, the Prime Minister warned that the road ahead will be difficult.

Repeating a point he made in Parliament last month, Mr Lee said that aside from the global economic storm, Singapore faces a new world with new market dynamics and tougher competition.

It needs to find new growth sectors and to gear up for them - like it did for biologics by creating the necessary talent pool before any investment decisions were made. One possibility, he said, is to offer Singapore as a corporate base.

'Asia is now the main growth story in the world. Many companies are therefore looking to locate their key functions and decision makers closer to Asian markets,' he said.

Mr Lee concluded: 'Drugs are physically small, but their effects are targeted and potent. That is how Singapore must be.

'Ours is a small island with no natural resources. We must therefore invest in knowledge and R&D, recruit and groom talent, and focus our efforts to excel in niche areas.

'Then we can trescend the limitations of physical size and punch above our weight class among the global competition.'

-end of ST article