Chasing $80bn sales target, AZ unveils $3.5bn US investment

AstraZeneca plans to invest a whopping $3.5 billion to expand its R&D and manufacturing operations in the US by 2026, as part of a drive to raise its revenues to $80 billion by the end of the decade.

The programme – part of the pharma group's Ambition 2030 effort – will include the construction of a new R&D centre at Kendall Square in the heart of the biopharma hub in Cambridge, Massachusetts, and a biologics manufacturing facility in Maryland.

There will also be expansion of cell therapy manufacturing capacity on "the West and East coasts," as well as specialty manufacturing in Texas, according to AZ, which said $2 billion of the investment is earmarked for the creation of more than 1,000 "new, high-skilled jobs contributing to the growth of the US economy."

The decision to invest in the US comes shortly after the election of Donald Trump as the US President-Elect, who has threatened to impose widespread tariffs on imports of goods, including pharmaceuticals, which has caused concern in Europe.

AZ chief executive Pascal Soriot said, however, that the big investment was driven by the "attractiveness of the business environment, together with the quality of talent and innovation capabilities […] in the US."

Crucially, the announcement does not seem to impact a planned £450 million ($578 million) investment in a vaccines manufacturing plant in Liverpool, UK, which in the summer was rumoured to be at risk of relocation to Philadelphia, which AZ has insisted was false.

It came as AZ reported its third-quarter results, headlined by a 20% increase in revenues to $12.95 billion, which will be discussed in full at a meeting today, along with other pressing matters, such as the recent revelations of a Chinese probe into current and former executives, including country president Leon Wang.

Soriot said that the company is taking the situation in China "very seriously," adding that "if requested, we will fully cooperate with the authorities." AZ's update reiterated that the company has not received any notification that it is itself under investigation.

The US is AZ's biggest market, currently accounting for 44% of its total revenues, and the investment programme ties in with AZ's plan to accelerate its development there, which is a key part of Ambition 2030.

"By expanding our R&D and manufacturing footprint, we aim to enhance the development of cutting-edge therapies and support the US leadership in healthcare innovation," said Soriot.

The company has also raised its sales and profit forecasts for full-year 2024 for the second time in successive quarters, saying it expects revenues to increase by a high teens percentage, up from its earlier prediction of a mid teens percentage rise.