“Securing this deal was a big test of Labour’s economic credibility, and they have failed”, said Mr Mak.

The pharmaceutical giant announced its decision to cancel its planned investment just two days after Chancellor Rachel Reeves set out Labour’s plan to go “further and faster” to boost economic growth. She named AstraZeneca in her speech as an example of one of the “great companies” that was investing in the UK.

The project would have seen an expansion of its vaccine manufacturing plant in Speke, Merseyside.

But AstraZeneca said that following “protracted” talks with the government, it would not be going ahead with the investment, although existing production and jobs would be maintained.

The firm said a number of factors had led to the decision including “the timing and reduction of the final offer compared to the previous government’s proposal”.

The science minister said the company had decided to lower the amount it was investing in research and development.

Sir Chris told parliament: “AstraZeneca were going to put in £150 million of R&D. They then decided to cut that to something like £90 million of R&D. That was their decision based on their own investment decisions.”

The government had subsequently made AstraZeneca an offer that was “remarkably close to the £90 million the previous chancellor had offered…but that, for whatever set of reasons, didn’t get it over the line,” he said.

Plans to expand AstraZeneca’s site at Speke had been set out by the previous Conservative chancellor, Jeremy Hunt, in last March’s Budget.

But reports later emerged that talks over the plans between the new Labour government and the company had run into delays.

Sir Chris insisted AstraZeneca hadn’t lost confidence in the UK and still invested more than £2.5bn in the UK economy every year.

“AstraZeneca aren’t leaving. People aren’t losing their jobs over this….there are still 10,000 people employed by AstraZeneca in the UK,” he said.