Announcement of the UK life sciences sector deal

January 2018

A new "sector deal" for life sciences was announced as part of the Industrial Strategy White Paper published by the UK government in November 2017, with further details of the sector deal published on 6 December 2017. The sector deal follows the publication of the government-commissioned industrial strategy report, authored by Professor Sir John Bell, which put forward recommendations to government for promoting the sector's long-term success. It is the first in a series of deals that the government intends to agree with the sector to realise the vision set out in the strategy report.

The objective of the Industrial Strategy is to boost UK productivity and employment through investment in "five foundations": innovation, people, infrastructure, places and the business environment. In relation to the UK business environment, the Industrial Strategy identifies the launch and roll-out of sector deals – partnerships between government and the private sector – as a key policy, and announces the first such sector deals within the life sciences, construction, artificial intelligence and automotive sectors. The sector deals are designed to build upon the successful model of collaborative working between the government and industry, as exemplified by existing partnerships such as the Office for Life Sciences.

The deal includes:

Reinforcing the UK science offer: The government will increase total public investment R&D funding to £12.5bn by 2021/22. Significant commercial investments in UK science facilities have also been announced, including a major investment by MSD in a state-of-the-art UK discovery centre in London anticipated to accommodate 950 staff, Novo Nordisk's establishment of a £115m diabetes research centre in Oxford, and QIAGEN's plans to partner with Health Innovation Manchester to develop a new genomics and diagnostic campus as well as expanding its existing operations in Manchester. The deal also includes significant investments by GSK and AstraZeneca in initiatives to harness advances in UK genomics research in the development of medicines.
Health Advanced Research Programme (HARP): The deal provides substantial concrete commitments for HARP – a collaborative programme between industries, charities and the NHS focused on ambitious long-term UK-based projects – including investment of up to £210m into an early diagnostics and precision medicine challenge.
Medicines manufacturing: The government has committed £162m for developing medicines manufacturing infrastructure, including two national manufacturing centres and three advanced therapy treatment centres to be co-located in UK hospitals. The deal highlights the recent announcement by Seqirus of its £40m investment in a new high-tech 'fill and finish' facility in Liverpool as illustrating industry's increased recognition of the UK's prominence in advanced therapy manufacturing.
Scale-up of UK businesses: Measures to improve access to finance to enable scaling-up of UK businesses have been announced, such as the establishment of a new £2.5bn Investment Fund incubated in the British Business Bank.
Clinical trials environment: The deal outlines proposals to promote inward investment in UK clinical trials through the streamlining of clinical trial approvals processes, and further investment in NHS research infrastructure. Major collaborations between industry and academia have also been announced, including a collaboration between Janssen Pharmaceutica NV and the University of Oxford to develop novel clinical trial methodologies.
Access to data: NHS England, NHS Digital and Health Data Research UK will lead the delivery of a programme for establishing regional digital innovation hubs, with the aim of improving access to patient datasets for research purposes.
NHS collaboration: The deal recognises the importance of the NHS to the UK life sciences landscape, and of the opportunities for improving care pathways and patient services through advancing collaborations between NHS and industry. It highlights particularly successful collaborations such as the new 15-year partnership between Johnson & Johnson Managed Services and Guy's and St Thomas' NHS Foundation Trust to deliver an Orthopaedics Centre of Excellence at Guy's Hospital.
Infrastructure and Clusters: The deal includes investment in life sciences 'clusters', including housing and infrastructure projects in the Oxford-Milton Keynes-Cambridge corridor and a £350m investment programme in Leeds City Region's leading MedTech hub. Major commercial developments in key clusters have also been announced, such as BBI Group's new global headquarters in Crumlin, South Wales.
Skills base: The deal highlights the need to ensure a highly-skilled workforce through measures to support high-skilled immigration as well as support for industry's investment in the UK's domestic skills base.

The government has also announced the creation of an independent Industrial Strategy Council to evaluate the progress of the Industrial Strategy and make further recommendations to government.

Industry's response to the sector deal has been positive, with a number of major pharmaceutical companies committing to further investments in the UK. GSK said the sector deal contained "a number of very practical commitments to strengthen the UK's life science base and make it more attractive to international investment in areas such as clinical trials and high-tech research", while the author of the life sciences industrial strategy report, Professor Sir John Bell, commented that the sector deal "demonstrates how powerful it can be to have industry, the NHS, the research community and charities all working together to provide important new insights that can lead to the discovery and implementation of novel innovations for healthcare… It represents a significant change in both pace and culture that I hope will lead to a flow of such investments into the future.”

The prominence given in the Industrial Strategy to the life sciences sector deal demonstrates the government's recognition of the importance of the sector for the UK economy and of cementing the UK's position as a world leader post-Brexit.

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