As we move into 2023, there is great potential for UK based companies. In 2021, the UK ranked third globally (behind the USA and Germany) for volume of foreign direct investment (FDI) projects won, and second for FDI-related capital expenditure. The same year, the UK secured £7 billion in equity financing, a greater than twelve-fold increase since 2012. However, 2022 saw a more turbulent life sciences market emerge globally, and the UK has been adversely affected. The value of deal making in the Biopharma arena saw a 38% decline year-on-year.
As investment declined and following a very robust period of growth for new vacancies in 2021, as we moved through 2022, the UK market experienced a significant reduction in new vacancies in Q3/4. Scientific roles decreased by 15%, and this pattern gathered momentum across most sectors within life sciences. The exception to decline was in Wales, where the growing life sciences market saw an 11% increase in new job opportunities.
Current political instability, uncertainty with Brexit and the pause in deal making will affect the fortunes of 2023, with early indicators showing a continued decline or flat growth in new jobs in the life sciences sector. In a statement made at the start of 2023, Jeremy Hunt, UK Chancellor of the Exchequer, said, “If anyone is thinking of starting or investing in an innovation or technology-centred business, I want them to do it in the UK. I want the world’s tech entrepreneurs, life science innovators, and clean energy companies to come to the UK because it offers the best possible place to make their vision happen.” The government’s plans sound promising, but there are multiple areas that need deeper scrutiny to attract the entrepreneurs and innovators the UK needs.
Hunt finished by stating, “And if you do, we will put at your service not just British ingenuity - but British universities to fuel your innovation, Britain’s financial sector to fund it and a British government that will back you to the hilt.” The value of estimated inward life sciences FDI in the UK was £1.9 billion in 2021, behind only the USA in terms of value. With markets currently under pressure and continued turbulence for the foreseeable future, it is clear the UK government needs stability and a focus on growth. We need to do more to build greater domestic capacity and capability in venture funds and institutional investors to help support UK start-ups to scale to a more impactful size. We need to seize on our position as a science and technology superpower, as we are currently a major contributor to solving future healthcare challenges. More focus needs to be placed on supporting our vibrant life sciences industry and better leveraging of the strong international relationships and opportunities to create better conditions and channels for trade. Clinical trials are also a valuable form of mobile R&D investment, and during the pandemic, the UK showed its ability as a world leader, delivering high quality clinical studies at unprecedented speed. The Department for International Trade (DIT) should continue to work across the life sciences ecosystem to support and promote the UK as a clinical research destination and to secure R&D investment, which can speed up innovations into the NHS.
We live in uncertain times. The UK needs to be pro-active in promoting its great science base and not talking itself down. Whether a supporter of Brexit or not, we need to forge ahead in a post Brexit world and deliver on the changes needed to move us forward.
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Yvette Cleland - CEO | Cpl UK