Hot topic: Doubts over UK’s growth potential as AstraZeneca axes vaccine plant

Just a week after science minister Lord Vallance was appointed the “Oxford-Cambridge Innovation Champion”, the gloss has well and truly disappeared from the government’s attempts to bolster its life sciences credentials.

Just as the Labour government was looking for a good news story to highlight the UK’s potential as a site for international investment, the country’s largest pharma opted to ditch its plans to invest £450 million ($558 million) in a vaccines factory.

AstraZeneca’s shock move to axe the investment in its Speke site in Liverpool has been described as a PR disaster for Prime Minister Sir Keir Starmer and Chancellor Rachel Reeves, who are trying to encourage capital investment projects from large companies.

Rumours blamed Reeves for the deal falling through, with reports suggesting she pushed to reduce a supporting government funding package from £90 million to £40 million.

It’s not clear what happened behind the scenes, but the news adds to the ire of an industry that is furious at the rebates demanded by the government on pharmaceutical sales to the NHS.

The latest voluntary scheme requires rebates of up to 22.9%, meaning industry will repay around £3.4 billion.

Under pressure from all quarters on the state of the economy, the government must do more than appointing “champions” to win back trust from an increasingly sceptical life sciences industry.