Will AstraZeneca Plant Snub Change Life Sciences Policy?
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Over the last few years, the life sciences sector has been one of the big success stories for the UK. Part of the reason for this has been the enthusiastic support it has had at government level, something that appeared set to continue despite a change of government at the last election.
This was praised by the Association of the British Pharmaceutical Industry at the time, not least the Labour manifesto’s positive tone, as every realistic expectation was they would soon be in power.
However, now that is the case, the new administration has suffered a major blow just a few months in after AstraZeneca announced it was no longer planning to invest £450 million in expanding a flu vaccine plant at Speke in Liverpool.
The company cited several factors in the decisions, including “the timing and reduction of the final offer compared to the previous government’s proposal.”
A Treasury spokesperson said the nature of the investment had changed and the deal no longer offered the taxpayer value for money, but some will question what signal this sends at a time when further expansion of the life sciences sector is a significant part of the government’s drive to deliver growth to Britain’s flatlining economy.
As might be expected, the news prompted severe criticism from the opposition, with shadow business secretary Andrew Griffiths declaring there was “no vaccine for incompetence”, especially as the announcement came just after AstraZeneca had been publicly praised by chancellor Rachel Reeves.
While the government will seek to defend its position now, it may make some very different decisions about future investment prospects to prevent a repeat of the Speke plant snub.
Given the importance of life sciences and the high levels of investment being made by the biggest companies in the sector in other countries – AstraZeneca has just announced an C$820 million (£458 million) investment in Canada – it is possible the Treasury will think hard before passing up opportunities to secure similar-sized investments in Britain.