AstraZeneca weighs shifting manufacturing of some medicines from Europe to the US
AstraZeneca is considering a shift in manufacturing of some medicines from Europe to the United States to help mitigate potential tariffs on pharmaceuticals by the Trump administration, according to CEO Pascal Soriot.
During the company’s first-quarter earnings call on Tuesday, Soriot said AstraZeneca has a “substantial and growing” manufacturing footprint in the U.S. with 11 production sites in the country, with the “vast majority” of its medicines sold in the American market made domestically and a “minority of medicines sold in the U.S. from Europe.”
At the same time, Soriot made the case that the potential impact of tariffs on the minority of medicines imported from Europe “would be time-limited, as we are shifting manufacturing of these medicines to sites in the U.S.”
“Instead of globalizing the manufacturing of one product in the U.S. for the world or in Europe for the world, we can actually share and sort of manufacture one product for the U.S. in the U.S. and the rest in Europe and vice versa,” Soriot said.
In November 2024, AstraZeneca announced a $3.5 billion investment to expand its U.S. manufacturing and R&D capabilities, set for completion by the end of 2026. The capital expenditure includes $2 billion for new projects, including a next-generation biologics manufacturing facility in Maryland, cell therapy manufacturing facilities on both the East and West Coasts, as well as specialty manufacturing operations in Texas.
However, on Tuesday’s earnings call, CFO Aradhana Sarin was cautious about AstraZeneca committing to additional capital expenditure (CapEx) investments in the U.S. beyond 2025.
“We’ve said this year that our CapEx would be, you know, 50% higher than last year but going forward we need to look at how the portfolio develops,” Sarin told analysts.
Soriot said that over the last few years AstraZeneca has been building a broad manufacturing network covering the U.S., Europe, and China, with 31 production sites globally and dual-source supply for most of its medicines.
“Our global presence makes our business highly resilient to regional disruptions, effectively providing a natural hedge,” according to Soriot. “Our supply chains for China and the U.S. are largely segregated, and we have very limited commercialized finish medicines imported from the U.S. to China, meaning that our exposure to the current China tariffs on pharmaceuticals is not material.”
Last month, AstraZeneca unveiled a $2.5 billion plan for R&D, biotech and manufacturing expansion in Beijing — the company’s first vaccine manufacturing site in China. However, in February, it scrapped plans to invest $558.3 million in a vaccine manufacturing plant in northern England, citing a reduction in UK government support.