The former Tory Chancellor Norman Lamont has warned that AstraZeneca quitting the London Stock Exchange would be a “devastating blow.”
The former Tory Chancellor is warning the Labour government not to use pharmaceutical giants as “cash cows” and Lamont is strongly urging Rachel Reeves to treat drug companies as “valuable investments to be encouraged”.
AstraZeneca has a market value worth of more than £160 billion which is the most valuable firm on the FTSE 100 who are considering to move to the US market causing concerns over London’s status as a global financial hub.
AstraZenenca earlier this year pulled £450 million investment from a vaccines manufacturing factory in Merseyside as the government failed to match the Tory government’s offer for financial support.
Lord Lamont said, “The loss of AstraZeneca, were it to happen, would be a devastating blow to the London Stock Exchange.
“Is it not therefore very important, if we are to retain the listings, that the Government have a supportive policy for life sciences in particular?
“Is it not regrettable, first, that the life sciences review has not yet appeared and, secondly, that the Government refused to back the vaccine plant at Speke near Liverpool?
“The Government also increased the rebate payable by pharma companies from drug sales from 15% to 22% – a stealth increase if ever there was one.”
He added: “Is it not important that, if we want to retain the listings, which will mean retaining the research, development and employment, we have a proper strategy with these companies and do not just regard them as cash cows but valuable investments to be encouraged?”
Treasury minister Lord Livermore said, “I fundamentally agree with the underlying point he made about the importance of investing in and having the right environment for life sciences companies in this country. They are incredibly important to us. It is why they are fundamental to our industrial strategy.”
He added, “In terms of specifics, I am not going to comment on speculation.
“We want to see high-growth companies start, scale, list and stay in the UK.
“He is absolutely right, the life sciences sector plan is forthcoming. If he is just a little bit more patient, he will see it very soon.
“Through that, we will seek to harness the life sciences sector to drive long-term economic growth and build a stronger, prevention-focused NHS.”
Tory shadow Treasury minister Baroness Neville-Rolfe said, “This would be a real blow to our stock market of £160 billion.
“It is also increasingly feared that AstraZeneca could be redomiciled to the US, risking losses for London as a hub, hundreds of jobs and tax losses for the Chancellor.
“What changes will the minister make to the UK’s investment environment to stop the troubling and damaging exodus of high-value firms from our market? We would love some detail?”
Lord Livermore said, “The Government recognise, as she did, that the UK’s equity markets have faced challenges in recent years, but that is not a new phenomenon.”
He added, “Firms may choose to list in other countries for a variety of reasons.
“It would not be appropriate for me to comment on individual companies or on speculation, but, of course, the Government should do everything that they can, as she said, to improve the competitiveness of our market and the attractiveness of the UK as a place to list.”
