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.
Image: 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.
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“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.”
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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.
Image: 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.”
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.
Talk to economists and they will tell you that the cost of living crisis is over.
They will point towards charts showing that while inflation is still above the Bank of England’s 2% target, it has come down considerably in recent years, and is now “only” hovering between 3% and 4%.
So why does the cost of living still feel like such a pressing issue for so many households? The short answer is because, depending on how you define it, it never ended.
Economists like to focus on the change in prices over the past year, and certainly on that measure inflation is down sharply, from double-digit levels in recent years.
But if you look over the past four years then the rate of change is at its highest since the early 1990s.
But even that understates the complexity of economic circumstances facing households around the country.
For if you want a sense of how current financial conditions really feel in people’s pockets, you really ought to offset inflation against wages, and then also take account of the impact of taxes.
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That is a complex exercise – in part because no two households’ experience is alike.
But recent research from the Resolution Foundation illustrates some of the dynamics going on beneath the surface, and underlines that for many households the cost of living crisis is still very real indeed.
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2:32
UK inflation slows to 3.4%
The place to begin here is to recall that perhaps the best measure of economic “feelgood factor” is to subtract inflation and taxes from people’s nominal pay.
You end up with a statistic showing your real household disposable income.
Consider the projected pattern over the coming years. For a household earning £50,000, earnings are expected to increase by 10% between 2024/25 and 2027/28.
Subtract inflation projected over that period and all of a sudden that 10% drops to 2.5%.
Now subtract the real increase in payments of National Insurance and taxes and it’s down to 0.2%.
Now subtract projected council tax increases and all of a sudden what began as a 10% increase is actually a 0.1% decrease.
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Will we see tax rises in next budget?
Of course, the degree of change in your circumstances can differ depending on all sorts of factors. Some earners (especially those close to tax thresholds, which in this case includes those on £50,000) feel the impact of tax changes more than others.
Pensioners and those who own their homes outright benefit from a comparatively lower increase in housing costs in the coming years than those paying mortgages and (especially) rent.
Nor is everyone’s experience of inflation the same. In general, lower-income households pay considerably more of their earnings on essentials, like housing costs, food and energy. Some of those costs are going up rapidly – indeed, the UK faces higher power costs than any other developed economy.
But the ultimate verdict provides some clear patterns. Pensioners can expect further increases in their take-home pay in the coming years. Those who own their homes outright and with mortgages can likely expect earnings to outpace extra costs. But others are less fortunate. Those who rent their homes privately are projected to see sharp falls in their household income – and children are likely to see further falls in their economic welfare too.
Britain’s biggest high street bank is in talks to buy Curve, the digital wallet provider, amid growing regulatory pressure on Apple to open its payment services to rivals.
Sky News has learnt that Lloyds Banking Group is in advanced discussions to acquire Curve for a price believed to be up to £120m.
City sources said this weekend that if the negotiations were successfully concluded, a deal could be announced by the end of September.
Curve was founded by Shachar Bialick, a former Israeli special forces soldier, in 2016.
Three years later, he told an interviewer: “In 10 years time we are going to be IPOed [listed on the public equity markets]… and hopefully worth around $50bn to $60bn.”
One insider said this weekend that Curve was being advised by KBW, part of the investment bank Stifel, on the discussions with Lloyds.
If a mooted price range of £100m-£120m turns out to be accurate, that would represent a lower valuation than the £133m Curve raised in its Series C funding round, which concluded in 2023.
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That round included backing from Britannia, IDC Ventures, Cercano Management – the venture arm of Microsoft co-founder Paul Allen’s estate – and Outward VC.
It was also reported to have raised more than £40m last year, while reducing employee numbers and suspending its US expansion.
In total, the company has raised more than £200m in equity since it was founded.
Curve has been positioned as a rival to Apple Pay in recent years, having initially launched as an app enabling consumers to combine their debit and credit cards in a single wallet.
One source close to the prospective deal said that Lloyds had identified Curve as a strategically attractive bid target as it pushes deeper into payments infrastructure under chief executive Charlie Nunn.
Lloyds is also said to believe that Curve would be a financially rational asset to own because of the fees Apple charges consumers to use its Apple Pay service.
In March, the Financial Conduct Authority and Payment Systems Regulator began working with the Competition and Markets Authority to examine the implications of the growth of digital wallets owned by Apple and Google.
Lloyds owns stakes in a number of fintechs, including the banking-as-a-service platform ThoughtMachine, but has set expanding its tech capabilities as a key strategic objective.
The group employs more than 70,000 people and operates more than 750 branches across Britain.
Curve is chaired by Lord Fink, the former Man Group chief executive who has become a prolific investor in British technology start-ups.
When he was appointed to the role in January, he said: “Working alongside Curve as an investor, I have had a ringside seat to the company’s unassailable and well-earned rise.
“Beginning as a card which combines all your cards into one, to the all-encompassing digital wallet it has evolved into, Curve offers a transformative financial management experience to its users.
“I am proud to have been part of the journey so far, and welcome the chance to support the company through its next, very significant period of growth.”
IDC Ventures, one of the investors in Curve’s Series C funding round, said at the time of its last major fundraising: “Thanks to their unique technology…they have the capability to intercept the transaction and supercharge the customer experience, with its Double Dip Rewards, [and] eliminating nasty hidden fees.
“And they do it seamlessly, without any need for the customer to change the cards they pay with.”
News of the talks between Lloyds and Curve comes days before Rachel Reeves, the chancellor, is expected to outline plans to bolster Britain’s fintech sector by endorsing a concierge service to match start-ups with investors.
Lord Fink declined to comment when contacted by Sky News on Saturday morning, while Curve did not respond to an enquiry sent by email.
Lloyds also declined to comment, while Stifel KBW could not be reached for comment.
The UK economy unexpectedly shrank in May, even after the worst of Donald Trump’s tariffs were paused, official figures showed.
A standard measure of economic growth, gross domestic product (GDP), contracted 0.1% in May, according to the Office for National Statistics (ONS).
Rather than a fall being anticipated, growth of 0.1% was forecast by economists polled by Reuters as big falls in production and construction were seen.
It followed a 0.3% contraction in April, when Mr Trump announced his country-specific tariffs and sparked a global trade war.
A 90-day pause on these import taxes, which has been extended, allowed more normality to resume.
This was borne out by other figures released by the ONS on Friday.
Exports to the United States rose £300m but “remained relatively low” following a “substantial decrease” in April, the data said.
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Overall, there was a “large rise in goods imports and a fall in goods exports”.
A ‘disappointing’ but mixed picture
It’s “disappointing” news, Chancellor Rachel Reeves said. She and the government as a whole have repeatedly said growing the economy was their number one priority.
“I am determined to kickstart economic growth and deliver on that promise”, she added.
But the picture was not all bad.
Growth recorded in March was revised upwards, further indicating that companies invested to prepare for tariffs. Rather than GDP of 0.2%, the ONS said on Friday the figure was actually 0.4%.
It showed businesses moved forward activity to be ready for the extra taxes. Businesses were hit with higher employer national insurance contributions in April.
The expansion in March means the economy still grew when the three months are looked at together.
While an interest rate cut in August had already been expected, investors upped their bets of a 0.25 percentage point fall in the Bank of England’s base interest rate.
Such a cut would bring down the rate to 4% and make borrowing cheaper.
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Is Britain going bankrupt?
Analysts from economic research firm Pantheon Macro said the data was not as bad as it looked.
“The size of the manufacturing drop looks erratic to us and should partly unwind… There are signs that GDP growth can rebound in June”, said Pantheon’s chief UK economist, Rob Wood.
Why did the economy shrink?
The drops in manufacturing came mostly due to slowed car-making, less oil and gas extraction and the pharmaceutical industry.
The fall was not larger because the services industry – the largest part of the economy – expanded, with law firms and computer programmers having a good month.
It made up for a “very weak” month for retailers, the ONS said.