Industry Focus: Life sciences – a treasure trove for growth or a sector at risk of falling behind?

The UK has long been a world-leader in life sciences.  It revolutionised medicine through discovering penicillin, was the first country to license and roll-out Covid-19 vaccines and is responsible for developing some of the world’s most important medicines and technologies.

Yet when the Industrial Strategy was published back in June, plans to lower energy costs and boost manufacturing hit the headlines while life sciences went under the radar.

It didn’t help that we had to wait a few weeks for the life sciences sector plan, however when it arrived there was lots to get excited about. Ambitions to be the leading life sciences economy in Europe and the third globally, fuelled by £2bn of investment, were widely cheered by the industry.  So too was the emphasis on improving R&D and supporting manufacturing with £520m for new facilities.

Barely two months later and confidence in UK life sciences has been damaged as projects worth over £1.5bn have been paused or withdrawn. First, US pharma giant Eli Lilly rowed back on plans to open labs in London’s Knowledge Quarter, then Merck scrapped a £1bn investment and withdrew from a Kings Cross site already under construction, blaming a lack of government investment in the sector.

It was another bitter pill to swallow when British success story AstraZeneca paused its £200m expansion in Cambridge before announcing its listing on the New York stock exchange. AZ insists it won’t leave home soil, but this could be perceived as a lack of confidence in UK plc.

Amongst all the doom and gloom, is there still hope for the sector?

I would say so.  The UK has an unrivalled life sciences heritage, our universities are global leaders in innovation, and the sector has consistently experienced high growth rates, with potential to grow a further £41bn by 2035. 

But we must make it easier for businesses to deliver that growth. Streamlining our planning system and investing in construction skills will help to address the shortage of lab space and ensure new R&D facilities can be built faster and better. This is particularly crucial in life sciences clusters, like the Oxford-Cambridge Arc and the North West, which have enormous potential for growth but a chronic shortage of facilities compared to other global hubs.

If we can get this combination of investment and planning reform right, life sciences could indeed be a treasure trove for growth.  If not, the recent trend of investment leaving the sector may not be so short-term.