Unused taxpayer-backed vaccine factory to be sold to US bidder

An unused vaccine factory which received £200m of taxpayer funding is to be sold to a US pharma giant, after Catalent was picked as the preferred bidder. 

The Telegraph understands that New Jersey-headquartered Catalent is on course to complete a deal to buy the Vaccine Manufacturing & Innovation Centre (VMIC) in Oxford next month. The pair are now entering exclusive talks. 

VMIC put itself up for auction late last year, and received a series of offers from interested parties.

Oxford BioMedica, Lonza and Fujifilm have all been named as being interested in the facility, which once finished will be able to make 70 million doses of vaccines within as little as four months. 

In accounts published on Friday, VMIC said it had decided, together with the Government, that “the vaccine resilience of the UK is best served by pursuing an option of a trade and asset sale to a third party”. 

The move to enter exclusive talks with Catalent follows the appointment of Neil Jones as interim CEO of VMIC last October.

He had previously been Catalent’s director of business development in Europe for four years, up until March last year.

It is not clear how much Catalent has offered to pay for VMIC, but sources said the Government was keen to receive as much of the grant funding back as possible.

The UK has poured more than £200m into building the site during the pandemic to try to speed up when it could be opened, and make it a much larger facility.

Initially it had been expected that VMIC would be built using taxpayer cash, and then generate its own money by long-term vaccine supply contracts.

However, the facility is still yet to have opened, and the spiralling costs to finish VMIC are understood to have become a concern in Whitehall.

Sources suggested that, without a buyer, VMIC may never open its doors – with ministers becoming much less frantic about needing this vaccine production capacity following what was largely seen as a success during the pandemic in getting jabs out quickly to the public.

Catalent declined to comment. A VMIC spokesman said: “I can confirm that VMIC is for sale and is now in the process of entering into a period of exclusivity with a preferred party, following a broader sales process. We remain committed towards a deal that brings continued vaccine manufacturing capability to the UK.

“We cannot add any further information at this point as the details are commercially sensitive to the interested party.”

The takeover of the site has, however, raised questions about whether the facility will be used for vaccine innovation, as initially planned. The thinking was it could house lots of start-ups all working on new vaccine innovations.

The UK’s research body put £60m into the centre in 2018 to “innovate new technologies, like personalised cancer vaccines”.

VMIC’s former chief executive Matthew Duchars told The Telegraph last week that there was a risk this could dampen the UK vaccine progress, unless this was maintained under a takeover deal.

“Innovation is a really important part of how the UK will stay at the forefront of science,” he said.

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