Pharmaceutical giant GlaxoSmithKline warned last night that more than 200 workers may be facing the sack at its North-East plant.

The company needs to cut some 400 people from the workforce at its plant in Barnard Castle, County Durham, by the end of the year.

Although 280 people have already applied to leave voluntarily management admitted yesterday that they were now looking at compulsory redundancies.

The news came as the Barnard Castle plant announced a £1.2m package of help, including a £750,000 investment in a new Teesdale Enterprise Fund, in a bid to soften the blow.

An initial 90 workers are set to leave the plant in the next few weeks, with another 90 to follow.

The company has so far received 280 applications for voluntary redundancy, but admits that not all of them are in suitable positions to be lost from the business.

It is set to switch to compulsory redundancies to achieve the 400 positions it needs to lose by the end of 2003.

A spokesman for the business said: "Around 180 staff have so far been accepted for voluntary redundancy. The first 90 of them will be leaving in the next few weeks, with the others phased out over time.

"We have so far had 280 volunteers for redundancy, but some of them are in positions that we need to maintain for the smooth running of the business."

He added: "We still have a target of 400 redundancies by the end of 2003 as a result of the merger of Glaxo-Wellcome with SmithKline Beecham.

"As there have not been enough volunteers in suitable positions, we will need to find the losses by compulsory means."