‘There’s no vaccine for incompetence’: how Liverpool lost AstraZeneca
Plus, your weekly news & to-dos roundup
Dear readers — a warm welcome to your Monday briefing. In today’s edition, we have an in-depth look at AstraZeneca pulling out of the vaccine hub promised to Speke, as well a chance to pay tribute to director David Lynch at DoEs Liverpool.
ICYMI: Last week, readers were treated to two fantastic pieces from Laurence. On Wednesday, we published his tribute to Goodison Park, which doubled as an inquiry into what the closure will mean for Everton as well as the neighbourhood they’re leaving behind.
Over the weekend, he explored the uncertain future of Liverpool’s theatres as some of the city’s most famous institutions have been left to rot. “What a thoroughly excellent exposition of the state of play regarding Liverpool's ex-theatres,” one reader wrote in the comments. “A litany of lost potential.”
The Post
Editor’s note: A big investigation many weeks in the making will be landing in your inboxes later this week, though only paid subscribers will be able to read it in full. Stories like that one, which take many hours of research and interviews, as well as thorough legal and fact checks, are only made possible thanks to the support of our paying members. It costs just £7 a month to join up — cheaper than a rather fancy lunchtime treat from Polpetta. If you haven’t yet, why not consider directly supporting the production of high quality investigative journalism in Merseyside?
The big story: Fumbling AstraZeneca
Top line: AstraZeneca have pulled out of their planned £450 million investment in Speke. Where was Steve Rotheram?
Context: Last May, when then-chancellor of the exchequer Jeremy Hunt announced that AstraZeneca was set to inject £450 million into the establishment of a new vaccine manufacturing plant in Liverpool, Steve Rotheram was joyous. The metro mayor hailed the investment as a “vote of confidence” in the work the Liverpool City Region Combined Authority (LCRCA) was doing to grow its health and life sciences sector, welcoming the “new investment and jobs for local people” the plant would bring.
Perhaps this anticipated underwriting of the city’s future was on the mind of Hunt’s successor, Rachel Reeves, last Wednesday when she praised AstraZeneca as one of Britain's “great companies”. The chancellor’s speech, which laid out bold investment and development plans mostly for Manchester and the South-East, did mention Liverpool in regards to Rotheram’s call for a review of the Green Book, the government’s guidance on appraisal for public investment in local projects long criticised for favouring schemes that guarantee an economic return. Reeves also declared “a commercially-attractive” — but to date, nebulous — “pipeline for investment opportunities” for the region.
That vague mention was, apparently, more than enough for some observers. Chancellor Rachel Reeves makes major Liverpool announcement in speech, read the Echo’s headline.
Unfortunately for both Rotheram and Reeves, two days after her speech, AstraZeneca withdrew from its plans. While the firm stressed that the existing facility at Speke, which employs some 450 people, would continue to manufacture its ‘flu vaccine, the £450 million vaccine manufacturing plant would not be going ahead.
The news is a major blow to the region’s economic prospects. The cancellation also has implications for the country as a whole. AstraZeneca is Britain’s biggest public company. In May 2024, the Guardian’s financial editor Nils Pratley noted it was racing Shell to become the first FTSE 100 firm to break the £200 billion valuation mark. There’s also the matter that, post-COVID, a country’s capacity to manufacture vaccines domestically has national security implications.
Reeves has been bullish about growth: the week before last, she and the business secretary Jonathan Reynolds were at Davos, touting a “pro-business” approach that included de-powering regulators and sweeping away restrictions. And despite a setback in its Chinese market, AstraZeneca has, too: in the autumn, chief executive Pascal Soriot unveiled a £3.5 billion investment programme in the US, alongside schemes in Canada and Singapore.
So why did the Speke plan fall through? “Several factors have influenced this decision,” said a spokesperson for the Cambridge-based pharmaceutical company, “including the timing and reduction of the final offer compared to the previous government’s proposal.”
When the now-cancelled Speke investment was first announced, Hunt offered AstraZeneca £70 million in building grants for the factory. According to Pratley, this alone was within the 15%-25% capital costs subsidy that industry insiders use as a good heuristic for the percentage of state aid to part-fund a large pharmaceutical facility. The deal also included an additional £20 million in research and development support from the UK Health Security Agency, meaning a generous £90 million in total.
According to documents acquired by The Times, shortly after Keir Starmer’s Labour Party came to power in the summer of 2024, Shaun Grady, AstraZeneca’s UK chairman, wrote to Reynolds seeking “crucial” early assurances on the future of the government’s advanced manufacturing plan, which were “particularly important” in the light of AstraZeneca’s proposed investment.
Despite Reynolds being privately warned it was an “urgent issue”, delays in securing government support had led AstraZeneca to miss its own internal deadline. Instead, the government sought to reduce the public money provided to £40 million, less than half the Conservatives’ offer.
Had the pharmaceutical giant withdrawn at that point, the reasons might have been obvious. However, AstraZeneca then entered what it called “protracted discussions” with Starmer’s government. Today, the Financial Times has reported that the government revised their offer to nearly £80 million earlier this month.
On the one hand, while it may seem unwise for a government to quibble over £10m in sweeteners for such an important investment, that’s still well over the 15% rule-of-thumb for a £450 million plant. It also raises the question of why AstraZeneca, currently proceeding with a multi-billion international programme, would pull out over such a relatively small reduction in the UK’s original offer. In today’s report, the FT implies a tetchy relationship between AstraZeneca, the government, and the NHS as a possible explanation, in keeping with The Times reporting on the firm’s “mounting frustration”.
But Post readers may well be asking: where was Steve Rotheram in all of this?
The LCRCA’s role: After AstraZeneca announced their withdrawal, Liverpool’s metro mayor posted a thread on X, saying that the LCRCA “has not been party to the negotiations between Government and AstraZeneca, which have taken place over many months.”
Should it have been? Last month, a government white paper confirmed funding for Rotheram’s plans to “become a global leader in the life sciences sector” by developing “new world-class facilities [that] will drive breakthrough research in infection, therapeutics, mental health, advanced manufacturing, and the use of data and AI to lead healthier lives.”
Had this conferred upon the mayor power to negotiate investment deals, Rotheram could perhaps have claimed six weeks was not enough time to rescue talks that had been souring for months. But according to the Institute for Government, the powers devolved to the metro mayor from Whitehall in 2015 include authority over investment.
In the same X thread, Rotheram also posted: “we have worked tirelessly to develop a comprehensive package of recruitment and training support to help convince AstraZeneca that further investment was the right option.”
The Post asked a spokesperson why Rotheram and the LCRCA were not involved in negotiations, as well as for details on this recruitment package, and how they could have been agreed on if the LCRCA was not party to discussions between the government and AstraZeneca in the first place. We also asked whether Rotheram at any point lobbied the government to increase its incentivising offer to AstraZeneca.
A Liverpool City Region Combined Authority spokesperson told us:
"Talks over AstraZeneca's proposed development were announced by the previous government in the Budget but no funding agreement was in place at that stage. Negotiations were between the government, as the body potentially offering grant funding, and AstraZeneca.
"Alongside that, the Combined Authority provided the government with a package of recruitment and training support to form part of their negotiation with AstraZeneca and to build on the company’s already strong presence in the city region. The package included work with local authorities to develop comprehensive recruitment and training plans specific to company requirements and based on specific job roles, and working with schools and colleges to develop talent pipelines.
[…]
“The Mayor and Combined Authority will be working with the government and AstraZeneca - who have enjoyed a long and productive presence in the city region - to see if focused talks can take place.
“The Mayor remains committed to increasing the levels of Foreign Direct Investment attracted into the region by 25% before the end of the decade. While AstraZeneca’s decision is a disappointing one, we are already beginning to see that concerted effort bear fruit with the recent announcement of 1,000 high-skilled jobs from Kyndryl.”
What’s next? Referring to the recruitment and training package LCRCR apparently offered AstraZeneca, Rotheram said on X that “work continues,” before confirming: “I’ll be working with the government and AstraZeneca - who have enjoyed a long and productive presence in the city region - to see if focused talks can take place.”
Carl Cashman, leader of the Liberal Democrat opposition on Liverpool City Council, wrote in a letter to Rotheram and Labour’s council leader Liam Robinson proposing they “put any differences we have aside” considering the importance of the plant and “send a joint delegation to parliament” to demand answers from Reeves as to how this deal fell through.
“We should also make a strong representation to AstraZeneca,” Cashman’s letter said.
Bottom line: Despite Rotheram and Cashman’s declarations, the revival of AstraZeneca’s investment in Speke now seems unlikely. Considering Reeves’ rhetorical obsession with growth and Rotheram’s specific trumpeting of life sciences in his plan for Liverpool, the fact the deal was allowed to fall through is an embarrassment for Labour both locally and nationally.
“The life sciences sector is supposedly a top priority for growth in the UK,” Kate Bingham, managing partner at venture firm SV Health Investors and former head of the UK’s Covid-19 vaccine taskforce, said in the FT. “Yet the government seems to lack the right expertise and strategic mindset to strike a productive partnership.”
As well as regional rivals like Cashman’s Lib Dems, the Conservatives are also scoring off Reeves’ “own goal”. “Manufacturing high-end vaccines is a huge opportunity for us to move away from over-dependence on the R&D part of the value chain,” said former chancellor Hunt, while the shadow business secretary Andrew Griffiths remarked, “There’s no vaccine for incompetence”.
Meanwhile, it’s impossible to estimate the lost value for Speke and Liverpool, both in terms of job loss as well as wider economic consequences. In the context of Reeves’ apparent focus on the South-East and Manchester — including backing Andy Burnham’s proposed redevelopment of Old Trafford and the surrounding area, while Everton’s new stadium must rely on private investment — it’s hard to see whether the government has any concrete plans to develop Liverpool and Merseyside at all.
Your Post briefing
Over 400 people turned up to a public meeting about the future of Southport pier last week. Back in 2022, the pier was closed by Sefton Council due to concerns over health and safety. Since then it has remained closed, with funding shortfalls to pay for repairs leaving its future hanging in the balance. Residents have been vocal about the negative effect on local businesses since its closure, with a public meeting organised in a fish and chip restaurant last week to discuss possible ways to fundraise to save the pier. The meeting’s organiser, Serena Silcock-Prince, expected around 40 attendees; over 400 residents turned up. The meeting was also attended by Conservative and Liberal Democrat councillors as well as Southport's MP Patrick Hurley. Mr Hurley said it had been a good starting point for discussions about how best to fund the reopening of the pier, which Sefton Council estimated could be as much as £13 million.
Four prison staff have been hospitalised in recent weeks after being assaulted in HMP Liverpool. The Prison Officers Association (POA) told the BBC the attacks happened after guards were left working alone on wings with up to 60 prisoners on. Mark Fairhurst, the national chairman of the POA, said “the staffing levels on each wing when we are unlocking prisoners are not safe”, adding there was a "lack of empathy and sympathy" among prison management. His comments came shortly after HMP staff told the Echo a female member of staff had her head split open in a recent assault. His Majesty's Prison and Probation Service (HMPSS) said it took staff welfare "extremely seriously", adding: “Those found guilty of causing harm to our hard-working frontline officers should expect to face the full force of the law." Know any more about this story? Email shannon@millmediaco.uk.
And good news for chess fans as Liverpool is set to host the annual British Chess Championships this summer. Held at St George’s Hall from 31st July to 10th August, the event will be celebrating its 111th year in 2025. Liverpool last hosted the championships back in 2008, as part of the European Capital of Culture celebrations. James Gallagher, from the Liverpool Chess Club — which is one of the oldest chess clubs in the world — told the BBC he expects the championships to “take over the city”, adding: “It’s going to be huge”.
Photo of the week
86 years ago, on the 4th of Feb 1939, Liverpudlians were getting into the Valentine’s Day spirit a little early. This photo captures a drama class run by Miss Dod in Liverpool, who taught kissing to improve self confidence.
Post Picks
📖On Wednesday, West Kirby Bookshop invite author Nicola Dinan to celebrate the publication of her second novel, Disappoint Me. Doors open at 7pm — tickets here.
🛀On Thursday, LUSH are hosting a 90s themed evening of music, conversation, and exclusive products to celebrate their 30th birthday. There’s a live performance by Liverpool artist Stealing Sheep, too. Tickets here.
📽️On Friday night, enjoy an evening of bold, surreal cinema at DoEs featuring David Lynch’s The Grandmother and an extraordinary lineup of short films from around the world. Tickets available here.
🎸To round off the week, why not head down to Jacaranda Baltic on Saturday for a live acoustic performance and Q&A from Olly Alexander, of Years and Years fame? The show is in support of his new album Polari. Tickets here.
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Correction: An earlier version of this story said AstraZeneca was closing in on a valuation of £200 million rather than £200 billion. This typing error has been corrected.
