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AstraZeneca ( AZN ) is second drugmaker to clinch Trump deal

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CEO Soriot charm offensive began post-2024 US election

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Soriot's strategic moves spare company from tariffs

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$4.5 billion Virginia plant boosted goodwill with Trump

By Maggie Fick

LONDON, Oct 12 (Reuters) - AstraZeneca ( AZN ) CEO

Pascal Soriot looked relaxed standing in the Oval Office on

Friday as U.S. President Donald Trump unveiled a medicine deal

that will lower drug prices for millions of Americans.

The hard work had paid off, allowing Soriot to clinch the first

agreement for a non-U.S. drugmaker and shield his Anglo-Swedish

company from threatened steep tariffs on imports to the U.S. -

the world's largest pharmaceuticals market.

That moment at the White House was the culmination of public

and private meetings between Soriot and Trump officials,

stretching back to November last year when Trump won election,

three sources close to the negotiations told Reuters. And it

went down to the wire with a last-minute push from AstraZeneca ( AZN )

to seal the agreement.

"You've kept me up at night and my team as well. But it's

been really worth it," Soriot joked to Trump.

ASTRAZENECA ( AZN ) CEO MET TRUMP AT ROYAL BANQUET

The agreement will likely bolster the 66-year-old French-born

Australian's reputation as something of a Trump whisperer, even

as many CEOs globally grapple with the president's whipsaw

tariff changes.

Trump argues Americans pay far too much - often three times

more, studies show - for prescription medicines than in other

wealthy nations and set a September 29 deadline for drugmakers

to cut prices, using threats of tariffs up to 100% as leverage.

Soriot's charm offensive started the week after Trump won the

U.S. election. On November 12, AstraZeneca ( AZN ) announced a $3.5

billion plan to expand manufacturing and research in the United

States.

Soriot, who arrived in the U.S. early last week, most

recently met Trump at a September 18 royal banquet dinner at

Windsor Castle in Britain, the first source said.

Over the summer he met with U.S. Secretary of Commerce

Howard Lutnick at least three times in Britain and the United

States, that source added.

All three sources asked not to be named as the talks were

confidential.

Soriot also developed a close relationship with vocal Trump

ally and Republican high-flier, Governor Glenn Youngkin of

Virginia, all three sources said. That led to a

rapidly-assembled deal for a $4.5 billion plant in the state,

which took just over a month to go from initial talks to an

agreement.

On Thursday, a day before the Oval Office signing, Soriot and

Youngkin stood shoulder-to-shoulder, shovels in hand, to break

ground at the site.

"Youngkin has a lot of ambition and his connections with the

administration were clearly helpful," a second source said. "The

Virginia facility deal showed the two sides were on the same

page."

ASTRAZENECA ( AZN ): A 'VERY AMERICAN COMPANY'

Following the agreement and a deal a week earlier by U.S. peer

Pfizer ( PFE ) that boosted global healthcare stocks, Wall

Street now expects more companies to reach similar agreements

with the Trump administration in the coming weeks.

Shore Capital analyst Sean Conroy said that Soriot, who

publicly backed Trump on drug pricing and called AstraZeneca ( AZN ) a

"very American company", secured a seat at the table in

Washington with smart strategic announcements.

"That rhetoric has clearly resonated with the Trump

administration and its agenda around Most Favored Nation drug

pricing," Conroy said, referring to the lowest price paid in

other wealthy countries after fees and rebates.

SOME CONCESSIONS, BUT A WIN FOR ASTRAZENECA

Analysts had estimated that AstraZeneca ( AZN ) was less exposed to

U.S. tariffs than many other major drugmakers, having already

established substantial manufacturing capacity in the United

States.

But tougher regulation and more price pressure in the UK, where

many drugmakers have criticised the government for not doing

enough to support the sector, gave AstraZeneca ( AZN ) a strong business

argument for the U.S. deal.

Britain accounts for a small percentage of the company's

revenues but is where it is headquartered and primarily listed.

AstraZeneca ( AZN ) is the largest listed firm on London's FTSE 100

Index.

In contrast to Britain, U.S. officials are in the midst of

an aggressive push to spur investment from firms like

AstraZeneca ( AZN ) and put in ample energy and effort to assist them,

the first source said.

In July, AstraZeneca ( AZN ) announced a sprawling $50 billion

investment plan for the U.S. market and in late September said

it would do a full U.S. listing of its shares alongside its

current London listing.

By the time Pfizer ( PFE ) signed its deal on September 30, AstraZeneca ( AZN )

was already nearing its own finalised agreement, the three

sources said.

Soriot headed to the U.S. early last week even as the last

details were being ironed out. Each day a deal looked close but

didn't arrive.

The Virginia plant agreement solidified goodwill between the

company and the Trump administration, which ultimately helped

push the deal over the line, the third source said.

In the end, while AstraZeneca ( AZN ) made concessions on some drug

prices for Medicaid and pledged to produce more medicines

locally, its U.S. arrangement marks a win for the company.

It gives more clarity, analysts say, without significantly

denting expected revenues, which AstraZeneca ( AZN ) is aggressively

forecasting at $80 billion by 2030, with half of that coming

from increased sales in the United States.

"Friday's deal is the last piece in the puzzle," the third

source added.