AstraZeneca's stock market exit would be devastating blow, warns ex-chancellor
Speaking at Westminster, the Conservative peer argued such companies should be treated as 'valuable investments to be encouraged'.
Lord Lamont of Lerwick raised his concern following reports AstraZeneca, which with an estimated market worth of more than £160 billion is the most valuable firm on the top-flight FTSE 100 index, is looking at moving its listing to the US.
The potential move would fuel worries over London's status as a global financial centre.
It comes after fintech Wise announced plans last month to transfer its primary equity listing across the Atlantic.
Earlier this year, AstraZeneca pulled out of a planned £450 million investment in a vaccine manufacturing plant in Merseyside last week, saying Labour failed to match the previous government's offer of financial support.
The firm had also been unhappy after the NHS spending watchdog refused to approve a life-extending breast cancer drug it made in a dispute over the cost.
The decision reversed an announcement made by then-chancellor Jeremy Hunt that would have seen the pharmaceutical company expand its existing facility in Speke.
The collapse of the deal came as a blow to the Government as it seeks to stress its commitment to growing the economy and making Britain more attractive to international investors.
Pressing the Government in Parliament, 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?'
Responding, 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 went on: '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.'
Challenging the minister earlier over AstraZeneca and its reported exit from the London market, 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.'
He said action was being taken to 'boost competitiveness' and pointed out Rachel Reeves would shortly unveil the Government's 10-year strategy for financial services, which would include capital markets.
Liberal Democrat Baroness Bowles of Berkhamsted, who is a director of the London Stock Exchange, said: 'In addition to the pull of US investors, does the minister recognise that there are push factors making the UK a hostile environment for innovative, high-tech growth companies?
'Excessive government retention of IP (intellectual property) exploitation rights in procurement and grant contracts undermines companies' growth prospects.'
Lord Livermore said: 'I do not necessarily share the overall pessimism that she started her question with.'
However, he acknowledged the need 'to rebalance our system towards growth'.
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