Why AstraZeneca’s new factory has gone to Dublin

‘Great news, Prime Minister, Astra-Zeneca has decided to site a new £320 million factory on Mersey-side. Your vision of the UK as a science superpower is becoming a reality.’ What a moment that would be for a Downing Street intern in search of the positive for an otherwise grim morning briefing; almost up there with ‘Great news, Prime Minister, Boris Johnson has joined a Trappist monastery’.

But no, AstraZeneca decided some time ago to put its next factory in Dublin. This is the pharma multinational that was a corporate hero of the Covid vaccine rollout and is a descendant of ICI, Britain’s greatest 20th-century science company; the very model of the kind of investor Rishi Sunak hopes to attract. But last week its boss Pascal Soriot explained why he’s not expanding his UK footprint, which include a research centre in Cambridge and factories in the north-west: because of a ‘discouraging’ tax regime, exacerbated by a notionally voluntary scheme known as VPAS that will force manufacturers of branded medicines to refund 26.5 per cent of sales revenues (up from 5 per cent in 2021) to the NHS this year.

Two US drug makers, AbbVie and Eli Lilly, have already opted out of VPAS, while Dame Emma Walmsley, who runs the rival pharma giant GSK, warns that the UK is falling behind in life sciences not only because of squeezed profits but also because of holdups in clinical trials (partly blamed on the overwhelmed state of the NHS) and delays in regulatory approvals. Sunak’s pledge to boost state-funded research makes scant difference if leaders of research-led globalised industries choose to shun high-tax, slow-progress Britain.

With apologies for repeating myself, we’ll never be a superpower in science or anything else without competitive corporate taxes and capital reliefs, plus a reputation for smart public-private co-operation and efficient delivery.