Drugs giant blames government after axing £450m plans for Liverpool vaccine plant

Pharmaceutical giant AstraZeneca has cancelled plans for a new £450m vaccine plant in Liverpool after funding problems with the new government.

The decision has likely cost 100 new jobs that were earmarked for the expansion.

In the Budget last March the then Chancellor, Jeremy Hunt, unveiled a government support package that would enable AstraZeneca to invest £650m in its facilities in Speke in South Liverpool, and Cambridge.

The Speke site currently makes an influenza vaccine in partnership with its sister site located in Philadelphia, USA.

Around 400 staff, comprised of scientists, manufacturing associates, engineers, quality professionals and support personnel, support AstraZeneca’s new Vaccine & Immune Therapy Area there.

It is the second largest Biologics site within the network, and a centre of excellence for testing and certification of medicines – supporting a further three additional commercial medicines.

AstraZeneca, has a strong North West presence, with key sites in Macclesfield and in Speke, employing a total of around 4,700 staff. Speke currently employs 400 staff, which was expected to rise to 500 following the latest investment.

Earlier last year it was reported that AstraZeneca was looking to get up to £100m of support from Whitehall to expand the vaccine manufacturing facility in Speke.

Labour MP, Maria Eagle, whose Garston and Halewood constituency includes Speke, pledged at the time to support any development in the Liverpool site, saying: “I will support in any way I can their expansion plans. It would be good for the country in terms of resilience against future pandemics and for the local community. I hope the Government will support them to enable this development to go ahead.”

However, today (January 31), AstraZeneca announced it has pulled out of the Speke project, blaming a reduction in government support.

A group spokesperson said: “Following discussions with the current government, we are no longer pursuing our planned investment at Speke.

“Several factors have influenced this decision including the timing and reduction of the final offer compared to the previous government’s proposal.”

The spokesperson said the site would continue to produce flu vaccines.

Last year it was reported that AstraZeneca warned it could relocate its vaccine manufacturing site from Britain to the US as talks with the Labour government over state aid had become deadlocked.

It is believed Chancellor Rachel Reeves wanted to reduce the Government’s support for the site from around £90m to £40m.

A Government spokesperson said a “change in the make-up of the investment” proposed by AstraZeneca had “led to a reduced government grant offer being put forward”.

They added: “All government grant funding has to demonstrate value for the taxpayer and, unfortunately, despite extensive work from government officials, it has not been possible to achieve a solution.

“AstraZeneca remains closely engaged with the Government’s work to develop our new industrial strategy, and more broadly we continue to have a thriving life sciences sector, worth £108bn to the economy and providing over 300,000 highly skilled jobs across the country.”

Andrew Griffith, Shadow Business Secretary, said: “There’s no vaccine for incompetence. In the same week they talked about growth, Labour seem to have fumbled a deal with AstraZeneca, one of the UK’s largest companies and central to the critical life sciences sector.”

Steve Rotheram, Liverpool City Region Mayor, said: “Although the Liverpool City Region is home to one of Europe’s largest pharma clusters, today’s announcement is still deeply disappointing.”

Maria Eagle has been contacted for comment.