The wrong battle

AstraZeneca is not the UK science base

"Science base" has become a semi-official buzzword. When British politicians discuss the possible takeover of London-based AstraZeneca by Pfizer, its larger US pharmaceutical rival, they claim only to be concerned with protecting the nation's scientific competence and employment. The numbers suggest otherwise. If the UK's science base was as strong as claimed versus other countries, there should be no issue. Pfizer would want to keep as much of its research and development as possible in Britain, for purely commercial reasons. After all, a national science base is in large part a gift of low-cost expertise to any sort of technology-intensive company.

Why would a company leave if local universities provide an ample supply of qualified graduates and organise lots of research, in large part at the government's expense? A country that welcomes highly skilled immigrants, eases planning for tech facilities, and readily finances new ventures is a good place to do business. The UK is not so inviting. The country dedicated 1.8 per cent of GDP to research and development in 2011, according to the World Bank, well behind the 2.8 per cent in the US and Germany. The current government has restricted skilled immigration. It imposed a real-terms cut on the science budget from 2010 to 2015.

Even if the UK were more hospitable to the tech trade, AstraZeneca would be a poor company to make an example of. True, it has committed to a big new facility in Cambridge. But it has reduced its global R&D headcount by 43 per cent - 6,700 posts - since 2010.

That sounds grim but AstraZeneca is behaving like most companies in an industry plagued by severe problems with commercialising science. R&D is a gamble for the old-line pharmaceutical companies. They increasingly rely on the high profit margins available for a few years on patented compounds, drugs which may offer only marginal improvements over older, cheaper alternatives.

If the science isn't performing well, there is always cost-cutting and tax minimisation. Pfizer may be serving its shareholders by doing both in a takeover of AstraZeneca. If the UK government sees science serving the national interest, it should just spend more.