Soriot’s red flag for pharma: Trump’s trade policies could have a devastating effect on healthcare, warns MAGGIE PAGANO

Sir Pascal Soriot is usually several steps ahead of the game, so always worth listening to.

His latest red flag is that Europe is falling behind in healthcare innovation and manufacturing investments, risking lives, but also leaving the Continent trailing behind the US and China, with jobs moving across the Atlantic.

It is a timely warning from the boss of AstraZeneca, Britain’s biggest company by value and one of the world’s giant pharma combines, coming as a sluggish Europe faces further upheavals from potential US tariffs and lower growth.

Soriot is the most outspoken pharma boss so far to warn about the dangers. The heads of Switzerland’s Novartis and France’s Sanofi are also concerned, arguing that European price controls on medicines not only hurt innovation but make the region less attractive to investors.

Even the European Federation of Pharmaceutical Industries and Associations is so worried about the danger of companies relocating to the US that it has stuck its neck out with a stark letter to the European Commission’s head, Ursula von der Leyen, outlining radical reforms.

Not surprisingly, Soriot was more cautious about criticising Donald Trump’s proposed tariffs, saying instead that trade levies are not the most effective way of managing the pharma sector. 

Yet even the threat seems to be working. Companies follow the money but also the brains, which are moving to the US too.

Like rival Roche earlier this week, Soriot also confirmed that the Cambridge-based giant would continue to invest in the US amid growing threats that tariffs may be imposed on pharmaceutical imports. AZ expects sales to the US will make up 50 per cent of the total over the next few years.

But Soriot is quite rightly far more vocal in his criticism of European leaders, claiming the region should spend more on medicines as it is planning to do on defence to ‘protect its health sovereignty’.

The big question is whether EU leaders will take any notice. They commission endless reports on opening up the region to competition and innovation – the latest being a fat document from former ECB boss, Mario Draghi. 

The Draghi report was highly critical of the region’s inertia, pointing out the EU should focus on technological investments to close the innovation gap with the US. And spot-on.

But none of the proposals have been implemented. And time is running out if the bloc is to compete globally.

As the hedge fund boss Kyle Bass wrote scathingly on X this week: ‘Europe is an anti-growth, anti-capitalist, pro-tax, super-regulatory, loose collection of broken economies.’

He did, however, make an exception for the Nordic countries and Poland.

Investors who have shipped billions into French, German and British stocks since Trump took office, he said, were foolish, adding that Europe was ‘a travel destination and a retirement community for the world’. Ouch.

But could the fear of Trumpian tariffs – and European companies leaving – finally stir the EU block into action? It was only when Trump threatened to withdraw security support for his Nato allies that member countries started increasing their defence spending.

Maybe Trump’s trade policies will have the same effect on healthcare.

Green heads roll

Activist US fund manager Elliott has claimed its first green scalp at BP. Giulia Chierchia, head of strategy and sustainability, is quitting in June after the oil giant’s decision to slash renewables and refocus on fossil fuels.

She’s gone because Elliott apparently wanted yet more proof from boss Murray Auchincloss that he is committed to moving even faster to cut costs and reduce spending. 

But Elliott can’t be happy that the shares are down a fifth since February’s about-turn, which was supposed to bring its valuation closer to peers like Exxon. They should be patient. It takes time to turn a supertanker around.

Heard on the street

If Reform wins in Runcorn tomorrow, Sir Keir Starmer is minded to sack Ed Miliband amid Cabinet disagreement over energy strategy. Apparently Rachel Reeves would like to revive oil and gas licences in the North Sea and water down Net Zero. 

If so, it is her first sensible idea.