GlaxoSmithKline is considering spinning off some of the work conducted at its research site in Verona, Italy, as part of ongoing consultations with staff, according to people familiar with the situation.

"Glaxo is looking at viable options ... this could be one," one source said on Wednesday. No decision on any spin-off has yet been made and the idea is still at an early stage.

But a move to bundle some of the neuroscience research projects from Verona into a separate stand-alone business, in which Glaxo could retain a stake, would mirror action by other large drugmakers in similar situations.

Roche's move out of antibiotics, for example, led to the creation of Basilea in 2000, while Sanofi-Aventis spun off its bone health research into what is now ProStrakan. A comparable move by Glaxo might go down well with the Italian government.

The country's economy undersecretary Alberto Giorgetti said on Tuesday he wanted to study "alternative options" with Glaxo to safeguard the wealth of research at the center, which he said could continue to be used for similar functions as in the past.

A Glaxo spokeswoman declined to comment.

Scientists at the Verona site are focused on discovering new drugs for depression, anxiety and pain - three categories of medicine for which Glaxo said last week it no longer planned to fund research because of uncertain investment returns.

The Verona site will remain open as a business center, but Italian trade unions said the move to stop research would affect more than 500 jobs, making it a leading casualty of Glaxo's R&D cutbacks. Other sites affected are in Harlow and Tonbridge in England, Zagreb in Croatia, Poznan in Poland, and Mississauga in Canada.

Glaxo, which is reining in costs like many of its rivals, plans additional annual savings of $782 million
by 2012, with half that coming from the planned reduction in R&D. The cuts are expected to result in around 3,000 job losses worldwide.