AstraZeneca’s pledge to poorer nations as it seeks COVID jab profits from next year
The chief executive of AstraZeneca (AZ) has told Sky News that the company’s decision to begin seeking a modest profit from its COVID vaccine is unlikely to kick in until next year.
Pascal Soriot said this was because it still had many doses of the vaccine to supply that it had promised to do so at cost.
AZ announced earlier this month that it would be seeking to achieve a modest profit in future from the vaccine In order to fund its new anti-viral COVID treatment.
But Mr Soriot stressed that, while some countries would be charged above cost for the vaccine, many more would not.
The Oxford-AstraZeneca vaccine has been sold at cost since it first became available Pic: AP
He said: “You have to remember that the orders we are taking today will be delivered next year. We still have a lot of orders at no profit to deliver. So they will be delivered next year.
“So you have got to think of the infection as if you were already in next year. And so essentially most of the world at that point will be in a different phase. And we will be more in a regional epidemic or regional pandemic than a global pandemic.
“But you know, we will of course adapt to every circumstance and countries that have low purchasing power we will be supplied at no profit or very low price and others will be a bit more.”
Mr Soriot insisted that he had no regrets that AZ had provided the vaccine at cost even though some of its competitors, such as Pfizer and Moderna, have supercharged their profits through charges for their COVID vaccines.
He went on: “We always knew that some vaccines would be sold at a profit and we made the decision from day one that we would partner with Oxford and deliver this vaccine around the world at no profit so everybody could access it much as possible.
Vials of COVID vaccines made by AstraZeneca, Pfizer, Johnson and Johnson, and Sputnik V
“And again, we’ve delivered more than 2 billion doses, 30% of global supply so far, so it really has worked quite well actually. So we always knew that it was what we were going to do. So there is no surprise, so there can’t be any regret – it was our plan all along.”
He was speaking as AZ, the largest company in the FTSE 100, formally unveils The Discovery Centre, its new £1bn research and development facility in Cambridge, which will be home to some 2,200 scientists.
The centre, to be opened by the Prince of Wales today, represents the biggest single investment ever made by AZ.
It has been specifically sited in Cambridge to be at the heart of the city’s life sciences cluster, within close proximity to the Royal Papworth and Addenbrookes hospitals, Cancer Research UK and the University of Cambridge’s school of clinical medicine.
The site is referred to in scientific circles as the ‘Nobel factory’ as it has created more Nobel Prize winners than anywhere else in the world.
Mr Soriot said AZ spent around $7bn (£5.3bn) on research and development annually – of which “a large proportion”, close to one third, is deployed in the UK.
He added: “it’s a very substantial investment we make each year.”
The opening comes at a hugely busy time for AZ which, earlier this year, completed the $39bn takeover of the rare diseases specialist Alexion.
That took the company, traditionally better known in the industry for its treatments for cancers, heart and respiratory conditions, into a fourth therapy area – and now it has decided, based on the success of its COVID vaccine roll out, to expand into a fifth, vaccines, as well.
However, asked whether AZ was trying to do too much at once, Mr Soriot insisted this was not the case.
He added: “We have great strengths in oncology and we believe we can be one of the three great companies in the world in oncology and maybe even better than that by 2025.
“We continue to do very well in cardiovascular and bio pharmaceuticals overall and now we have rare diseases and vaccines.
“What we call the vaccine and immunotherapy unit is really looking at is managing this portfolio of products to treat or vaccinate people with viral diseases.
“We want to maximise the value of these assets and manage them better.
“Now whether we invest in the long run in this field remains to be seen, but there’s a lot of synergies across this portfolio of products.”
Mr Soriot pointed out that AZ had just achieved its first quarter during which it had notched up $10bn worth of sales.
It is a significant milestone because, when Mr Soriot oversaw AZ’s successful defence against an unwanted takeover approach from Pfizer in 2014, he promised investors that AZ would be delivering annual sales of $40bn a year by 2023.
Business
JPMorgan Chase unveils plans to build new £10bn ‘landmark tower’ in London – double the size of The Shard
Plans have been announced for a new “landmark tower” in London with double the floor space of Britain’s tallest building, The Shard.
JPMorgan Chase unveiled details of the proposed office block after banks escaped having their taxes raised in the budget earlier this week.
The US multinational bank said the new building in Canary Wharf, in the east of the capital, would have a floor space of three million square feet. The Shard, in London Bridge, covers 1.3 million square feet.
However, the final design of the tower, including its height, is still being finalised.
A spokesperson for the firm told Sky News that they hoped to have clarity “soon” on how tall the building would be and the number of storeys. But it is expected to be one of the biggest office blocks in Europe.
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JPMorgan Chase boss Jamie Dimon reportedly signed off on the plans late last week.
It came after Sir Keir Starmer’s business envoy Varun Chandra flew out to New York to personally “offer assurances about the government’s business-friendly policies,” the Financial Times reported on Friday.
The Shard is the tallest building in western Europe. Pic: Reuters
The company also warned in a press release that its plans were “subject to a continuing positive business environment in the UK”, as well as planning permission from local authorities.
JPMorgan Chase said the project could contribute up to £9.9bn to the UK economy over six years, including by generating 7,800 jobs, many of them in the construction industry.
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The tower would house up to 12,000 people and serve as JPMorgan Chase’s main UK headquarters and its most significant presence in Europe, the Middle East and Africa.
The firm, which employs 23,000 people in the UK, said the tower would be “one of the largest and most sophisticated in Europe”.
The building is being designed by British architects Foster and Partners, known for landmarks projects including the new Wembley Stadium and London’s Millennium Bridge.
Mr Dimon said: “London has been a trading and financial hub for more than a thousand years, and maintaining it as a vibrant place for finance and business is critical to the health of the UK economy.
“This building will represent our lasting commitment to the city, the UK, our clients and our people.”
Mr Dimon added: “The UK government’s priority of economic growth has been a critical factor in helping us make this decision.”
Chancellor Rachel Reeves said she was “thrilled” about the announcement, while Mayor of London Sir Sadiq Khan said it represented a “huge vote of confidence in the capital’s future”.
Business
‘Sticking to Labour manifesto pledge costs millions of workers’, Resolution Foundation says
Sticking to Labour’s manifesto pledge and freezing income tax thresholds rather than raising income tax has hurt low- and middle-income earners, an influential thinktank has said.
Millions of these workers “would have been better off with their tax rates rising than their thresholds being frozen”, according to the Resolution Foundation’s chief executive, Ruth Curtice.
“Ironically, sticking to her manifesto tax pledge has cost millions of low-to-middle earners”, she said.
Chancellor Rachel Reeves announced in her budget speech that the point at which people start paying higher rates of tax has been held. It means earners are set to be dragged into higher tax bands as they get pay rises.
The chancellor felt unable to raise income tax as the Labour Party pledged not to raise taxes on working people in its election manifesto.
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But many are saying that pledge was broken regardless, as the tax burden has increased by £26bn in this budget.
When asked by Sky News whether Ms Reeves would accept she broke the manifesto pledge, she said:
“I do recognise that yesterday I have asked working people to contribute a bit more by freezing those thresholds for a further three years from 2028.”
“I do recognise that that will mean that working people pay a bit more, but I’ve kept that contribution to an absolute minimum”.
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The Resolution Foundation thinktank, which aims to raise living standards, welcomed measures designed to support people with the cost of living, such as the removal of the two-child benefit cap, which limited the number of children families could claim benefits for.
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The announced reduction in energy bills through the removal of as yet unspecified levies was similarly welcomed.
The chancellor said bills would become £150 cheaper a year, but the foundation said typical energy bills will fall by around £130 annually for the next three years, “though support then fades away”.
More to come
This budget won’t be the last of it, Ms Curtice said, as economic growth forecasts have been downgraded by independent forecasters the Office for Budget Responsibility (OBR), and growth is a “hurdle that remains to be cleared”.
“Until that challenge is taken on, we can expect plenty more bracing budgets,” she added.
It comes despite Ms Reeves saying as far back as last year, there would be no more tax increases.
Ultimately, though, the foundation said, “The great drumbeat of doom that preceded the chancellor’s big day turned out to be over the top: the forecasts came in better than many had feared.”
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