AstraZeneca Considers Relocating Vaccine Production Over UK Cuts
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AstraZeneca (AZN:US) has signaled it may relocate its vaccine manufacturing site from Merseyside to Philadelphia due to stalled negotiations with the Labour government over a reduction in state aid.
The current government, led by Chancellor Rachel Reeves, is considering cutting the financial support initially promised by the previous Conservative administration, reducing it from approximately £90 million to £40 million, according to sources familiar with the situation.
The original offer to AstraZeneca included up to £70 million in grants for enhancing the vaccine facility at Speke, alongside £20 million for research and development, as reported by insiders. The company has also hinted at the possibility of moving manufacturing to India, where it has previously produced vaccines.
The UK's potential reduction in funding contrasts with the significant incentives offered by the Biden administration as part of its industrial strategy. Shadow Technology Secretary Andrew Griffith, who was involved in the initial agreement, warned that failing to maintain the original funding levels would be a "huge backwards step for the UK," emphasizing the importance of keeping AstraZeneca's research at the heart of the UK’s life sciences sector.
AstraZeneca, which established its vaccine unit in collaboration with the University of Oxford during the development of a Covid-19 vaccine, withdrew the vaccine in May due to decreased demand in favor of treatments targeting newer Covid variants.
In response to the ongoing discussions, AstraZeneca stated, “We are committed to pursuing the opportunity at Speke and are in constructive discussions with the UK government. There are no discussions ongoing in the US or India.”
On the U.S. congressional trading front, Congressman Ro Khanna shares the utmost confidence in the pharmaceutical giant. From October 2023 to date, the lawmaker has invested up to $60,000 in the firm, comprising $15,000 worth of shares and $45,000 worth of stock options.
