AstraZeneca: the trouble with investing in Britain
Last week, Rishi Sunak and Jeremy Hunt hosted a summit of 200 prominent business figures “to drum up fresh investment in Britain”, said Ben Marlow in The Daily Telegraph. What better backdrop than a major snubbing from one of the country’s most respected CEOs? AstraZeneca’s “usually restrained” boss, Sir Pascal Soriot, confirmed the pharma will build a new $360m state-of-theart factory in Ireland, rather than northwest England, because of what he called the UK’s “discouraging” tax regime. He isn’t alone in his disaffection. In April, corporation tax will jump from 19% to 25%, just as a generous “superdeduction” investment tax relief scheme ends. These tax raids are “killing off investment”.
All credit to Soriot for highlighting the hypocrisy, said Alex Brummer in the Daily Mail. His word, as a champion of British life sciences, carries weight. But he’s being too polite. What he really means is the Government’s tax policy is “bonkers”. Astra’s plant would have created hundreds of low- and high-skilled jobs in the Northwest. What better way to “level up”?
Soriot is “not a fellow who typically picks public fights with the government”, said Alistair Osborne in The Times. And there’s more to his beef than corporation tax. Like the rest of Big Pharma, he’s also exercised by the rising cost of selling drugs to the NHS. The “NHS sales levy” (known as VPAS) has risen from an effective 5% to 26.5%, and is forecast to raise £3.3bn this year. Astra, which made $44bn in 2022, is arguably “rich enough to take it on the chin”, said Nils Pratley in The Guardian. But Soriot’s wider point stands. Once a laggard, Astra has a fair claim to being the UK’s most successful major company of the past decade. “If it can’t sound enthusiastic about investing in the UK, there is a serious problem.”