UK Life Science Marketbeat Report

For the data behind the commentary, download the full Q2 2025 UK Life Sciences Report

The Government’s industrial strategy brings a renewed focus on Life Sciences

At the end of Q2, the Government launched its long-awaited Industrial Strategy, and in July issued the Life Sciences Sector Plan. The renewed focus on supporting the UK’s life sciences sector is certainly very welcome, especially with the emphasis now on delivery and accountability.

As expected, the Sector Plan has the NHS at its heart, and it is right to recognise that the fortunes of the private sector are materially dependent on the performance of the NHS. It is good to note, for example, the commitment to get on and deliver on the recommendations of the O’Shaughnessy Report into clinical trials. Numbers of industry interventional clinical trials in the UK remain about 36% below the previous peak in 2017 and have only gradually increased from the trough of 2021 (source: ABPI). This is a part of the national life sciences ecosystem that needs urgent attention in order to prosper.

Medicine pricing regulation is also holding back the sector; the Association of the British Pharmaceutical Industry have been vocal in the press about the impact on investment in the UK.

An area where greater attention would reap dividends is the UK’s university sector. Universities form the bedrock of R&D activity, but numbers of spin outs per annum across all sectors have declined by over 20% since 2020/21 (source: HESA).  New-company formations per annum in the flagship location of Cambridge have more than halved since 2018 (source: Cambridge Ahead) – despite levels of venture capital funding consolidating above pre-pandemic levels. Research grants are going less far than they used to and with other operational financial pressures, the performance of universities cannot be taken for granted.

A point to challenge in the Sector Plan is the assertion that the “UK – particularly the Oxford to Cambridge Growth Corridor – suffers from a chronic shortage of lab space and clean rooms”. While this was certainly the case a few years ago, it isn’t any more. The real estate sector has stepped up and is now delivering the appropriate level of support to the life sciences sector, especially in the Golden Triangle, with a pipeline of 3.4 million sq ft of speculative life sciences space under construction and an additional 5.1 million sq ft of space having secured planning consent and potentially adding to the pipeline, if demand requires. Assistance from the government could make a real impact in unlocking this demand and realising the sector’s substantial capacity for growth.