Science for growth: are R&D incentives reaching their objectives?

15 December 2014

The UK has a world class research and development industry linked up to a very strong life sciences sector which employs an estimated 175,000 people and generates an annual turnover of over £50 billion. Research has been at the heart of the NHS since its foundation in 1948, and my mission as the UK’s first Minister for Life Sciences is to ensure that we continue to be the best place in the world to design and develop 21st century healthcare technologies.

In order to achieve this, we not only need to continue our support for “deep research”, but also accelerate the uptake of innovative medicines and devices in the NHS. This is why I recently launched the Innovative Medicines and MedTech Review which will examine how access to the latest research advances can be speeded up for NHS patients.

This will build on the massive success that the Strategy for UK Life Sciences has achieved in supporting the life sciences sector in the UK. Having helped coordinate this Strategy as Government Advisor for Life Sciences, I was delighted to see the Financial Times report in October this year that life sciences investment in the UK is at a seven year high, and the UK is leading the way in Europe in terms of the innovation capital raised. Investor confidence and activity is growing: £734 million was raised in the first half of 2014, compared with £483 million of innovation capital in the whole of 2013.

In a challenging and globally competitive environment our life sciences strategy is working! Latest figures show that at least £3.5 billion of investment has been announced in the UK life sciences industry since the Strategy was launched, of which around £2.6 billion comes from companies headquartered overseas. This investment is expected to create over 11,000 new jobs and safeguard a further 7,800 helping to maintain life sciences as an important part of a growing UK economy.

Through the UK’s Research Councils and the National Institute for Health Research (NIHR), we invest around £2 billion in research each year. We are also supporting the latest innovative technologies – genomics and data – that will transform the way healthcare is delivered in the 21st century. For example, over £300 million has been pledged to support the 100,000 genomes project. This is a truly groundbreaking project that sees the first at-scale sequencing of whole genomes anywhere in the world. This will be combined with NHS clinical records to create a powerful tool for understanding the causes of disease and how different patient groups respond to the same drugs in different ways. Genomics England will enable the UK to lead the world in this new frontier of genomic medicine just as the NHS led the way in the 20th century.

Given the huge challenges faced by our public finances, we must make sure that every pound of public money is used to maximum effect, leveraging and encouraging private sector investment. I’m proud that the £200 million allocated via the Biomedical Catalyst has attracted £100 million in industry co-investment and the £160 million invested by NIHR in its Biomedical Research Centres and Units in 2013-14 leveraged £108 million of industry research funding. The £51 million awarded to projects in the life sciences sector from the Regional Growth Fund is expected to leverage £323 million of additional funding and safeguard nearly 3,000 jobs. Independent analysis has shown that for every £1 of public investment spent on cardiovascular or cancer research, between 39 and 40 pence is returned through health and economic benefits every year.

In order to have a strong NHS, we need a strong economy generating the growth to pay for the health service. But I also believe that if we are to have a strong economy we need a strong NHS, keeping people healthy, and supporting a vibrant life sciences sector. Innovations within the NHS can also help to make the health service much more efficient so we can continue to pay for the increasing health and care needs of an ageing society.

As a developed Western economy, the UK is never going to be able to compete in terms of low labour costs, or rock bottom manufacturing costs. In order to drive growth we need to be a true innovation economy. Our research and development expertise is world class, and our action to support the life sciences sector is already stimulating investment, growth and jobs. The world stands on the dawn of a new age of bioscience, with extraordinary opportunities to help feed, heal and fuel some of the poorest people on earth.  The pace of growth in emerging new economies creates huge investment and export opportunities for UK plc. My mission is to ensure that the UK is at the forefront of this revolution. I will be fighting to ensure strong support for our research infrastructure so that the knowledge economy remains central to UK policy through genuine partnership between the public and private sector. This will accelerate innovation, deliver more efficient public services and drive sustainable long term prosperity. This is a big prize.

George Freeman MP is the newly appointed Minister for Life Sciences in the Department for Health and the Department for Business, Innovation and Skills.

This blog follows a roundtable discussion which Reform held on this topic with George Freeman MP on 25 November 2014. The event was sponsored by UCB.

Comments

Comments

No comments yet.