Why is Pharma Giant AstraZeneca Investing US$50bn in the US?
US President Donald Trump's sweeping programme of tariffs has prompted numerous businesses to set up shop in the US.
AstraZeneca is the latest in a long line planting roots in the US as a means to mitigate uncertainty, with plans to invest an eye-watering US$50bn by 2030.
Trump’s never-ending tariffs
President Trump's list of tariffs continues to grow, with a hard deadline of 1 August for countries to make alternative arrangements.
As well as specific country tariffs, including 35% for Canada and 50% for Brazil, Trump is targeting specific industries including pharma and automotive.
In May, Trump said the US would “no longer tolerate profiteering and price gouging from big pharma," threatening a tax of up to 200% on foreign drugs – potentially hitting organisations around the world.
Speaking to the press on 15 July, he said: “Pharmaceuticals will be tariffed, probably at the end of the month, and we’re going to start off with a low tariff and give the pharmaceutical companies a year or so to build and then we’re going to make it a very high tariff.”
A significant investment
In response, AstraZeneca, headquartered in Cambridge, England, has announced plans to invest US$50bn in the US by 2030.
US Commerce Secretary Howard Lutnick said: "We are proud that AstraZeneca has made the decision to bring substantial pharmaceutical production to our shores.
“This historic investment is bringing tens of thousands of jobs to the US and will ensure medicine sold in our country is produced right here.”
AstraZeneca's investment will be used to develop a new drug manufacturing facility in Virginia, as well as to expand R&D and cell therapy manufacturing in Maryland, Massachusetts, California, Indiana and Texas.
AstraZeneca's revenue reached US$54.1bn in 2024 and is projected to reach US$80bn by 2030. It is hoped a growing presence in the US will support the company in reaching this target, with expectations that half of its sales will eventually stem from there.
Sir Pascal Soriot, CEO of AstraZeneca, says the investment underpins the company’s “belief in America’s innovation in biopharmaceuticals and our commitment to the millions of patients who need our medicines in America and globally".
Chair of AstraZeneca Michel Demaré adds: “Central to this investment is a proposed new, state-of-the-art drug substance manufacturing facility in Virginia focused on chronic diseases, which is set to be our largest manufacturing investment to date.
“This milestone underscores our commitment to the vibrant US biopharmaceutical innovation ecosystem, strengthens our global R&D and manufacturing footprint and will broaden our impact on patients across the US and around the world.”
The transatlantic move
AstraZeneca is one of many pharmaceutical leaders expanding in the US.
In April, Swiss pharmaceutical company Roche announced a US$50bn investment in US manufacturing over the next five years, with plans to create more than 12,000 jobs.
Meanwhile, its main competitor Novartis looks set to invest US$23bn in the US.
American companies are also increasing their US investments: Johnson & Johnson plans to invest US$55bn in manufacturing and R&D.
The shift can also be seen outside of pharmaceuticals, with Apply announcing a huge US$500bn investment in the US over the next four years.
Clearly, Trump’s tariffs are promoting companies around the world rethink their manufacturing and supply chain strategies, causing ripple effects across each country’s financial markets.
