Drugmaker warns of UK investment withdrawal

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AstraZeneca has already halted or abandoned significant investments totaling hundreds of millions of pounds, attributing these decisions to reduced support from the British government.

British-Swedish pharmaceutical giant AstraZeneca may cease further investment in the United Kingdom if the government does not revise its current drug pricing policies, according to comments made by the company’s local chairman, as reported by The Telegraph. The multinational has already put on hold or canceled projects valued at hundreds of millions of pounds, citing an increasingly unfavorable business environment in the nation.

Shaun Grady identified the National Health Service’s (NHS) pricing system as a primary deterrent to investment, describing it as outdated and restrictive. This system includes limits on spending and high rebate rates for branded medications. The executive emphasized that the UK is falling behind in adopting new medical innovations, which diminishes its appeal as a location for global pharmaceutical expansion.

“We’ve [the UK] failed to keep pace on medicine investment over the years,” he was quoted saying during the Conservative Party conference.

Grady further warned that without improvements to the commercial landscape, the UK risks losing its standing among attractive international investment destinations. He also pointed out that the models used to assess the cost-effectiveness of new treatments, which have not been updated in 25 years, are outmoded, calling the situation “pretty appalling.”

Last month, AstraZeneca, which holds the largest market capitalization on the FTSE 100 index, temporarily halted a planned £200 million ($271.26 million) upgrade to its Cambridge research facility, a project expected to create 1,000 jobs. Earlier in the year, the company scrapped plans for a £450 million (over $600 million) vaccine manufacturing plant in northern England, citing a decrease in government funding.

The Telegraph reported that these actions put AstraZeneca’s entire £650 million UK investment package, initially announced for 2024, at risk of being withdrawn. The UK government has not yet provided a comment on the matter.

Grady also drew a contrast between the UK’s slow bureaucratic processes and the swift response of US authorities. He highlighted an instance where AstraZeneca met with the governor of Virginia and, just 33 days later, announced a £50 billion ($67 billion) investment in the US. He characterized the American approach as a “concierge service,” urging London to adopt a similarly competitive and nimble strategy to attract international capital.