The greater south east is home to 1,896 life sciences companies generating £16.6 billion annually and employing 62,855 people UK-wide, according to new research published today
The figures are unveiled today (Thurs 9 July) to coincide with an event to celebrate the first year of MedCity – launched by Mayor of London Boris Johnson in 2014 to drive forward life sciences research, development, entrepreneurship and commercialisation in London and the greater south east.
Produced by Trampoline Systems and SQW for the Greater London Authority, the new research claims to give the most accurate picture yet of the scale of the region’s life sciences sector. The research is brought to life by a new interactive map produced by Trampoline Systems that will be updated quarterly, online at: http://www.medcitymap.com/
It adds to growing evidence of the strength of the life sciences sector of London and the greater south east and the wider UK. Data from the Mayor’s promotional agency London & Partners published in January shows that UK life sciences attracted a record $713m of venture capital in 2014, a jump of 41% compared to 2013, with $502.6m of the total going to companies in the London, Oxford and Cambridge regions. 2014 also saw the sector’s strongest year on the London Stock Exchange since 2007, with £1.25bn raised in life sciences IPOs and follow on offerings.
The Mayor of London Boris Johnson said: “Whether it is the latest breakthrough in cancer drugs, leading laser eye surgery techniques or creating a global gold-standard for brain scanning, London is a city awash with great scientific minds and great scientific innovation. Through MedCity we want to maximise our incredible potential and become the most important scientific city on the planet.”
According to today’s report, London in particular boasts a unique set of distinctive features that are driving growth in life sciences:
- A research base with outstanding strength, scale and diversity, including world-leading universities and institutes
- A number of hospitals with international quality specialisms and facilities
- A large specialist labour market – partly driven by universities, which produce around 29,000 new graduates in life sciences subjects each year
- An ethnically and genetically diverse patient population of over eight million, served by a single health service – providing a diverse market for products and pool of clinical data
- World city status resulting in benefits including national and international networks and links, and major conferences, exhibitions and other events that bring leading people and organisations to the region
- The presence of specialist financial and professional services, including patent lawyers, venture capitalists, angel investor networks and IP experts
Geographically, the report shows that the sector is strongly concentrated in central and inner London, although pharmaceutical firms are more dispersed, with a higher proportion to be found in outer London. Unsurprisingly, minor concentrations are located around the major research hubs and bioincubators, including around the Euston corridor’s ‘Knowledge Quarter’, in Whitechapel’s Queen MaryBioenterprises Innovation Centre, South Kensington’s Imperial College and Imperial Innovations, and at Guy’s Hospital at London Bridge.
London’s universities are themselves commercialising their IP through their strong technology transfer functions. The most active of these is Imperial Innovations, which has 98 current investments, two thirds of the value of which is in therapeutics and med tech. King’s College London is involved in 17 active biosciences spin-outs and owns shares in 12, while University College London has 31 active spin-outs in biomedical sciences.
Dr Eliot Forster, Executive Chair of MedCity, says:
“This region is home to incredible strength, breadth and depth in life sciences. A real sense of this richness and opportunity is reflected in this new report. One big message is that we can’t look at London without also looking at the region of which it is an integrated part. The immense research and development expertise of Oxford and Cambridge added to that of London is an irresistible draw for industry and SMEs, and areas such as Stevenage, Kent and Southampton have vibrant, growing clusters. Together we have world-beating critical mass and, while there are challenges to be addressed, we are coming up with creative new ways to tackle them to become the leader in life sciences we aim to be.”
The report also notes that many firms that start in London scale up elsewhere in the greater south east, which could be viewed as a loss to London’s economy, but also as a sign that the market is working effectively.
Dr Forster comments: “Movement within the region is normal and healthy, and shows that companies are finding the most advantageous location for their needs – whether that’s to do with facilities, talent or being part of a research and industry cluster focused on a particular technology or field. It’s great to see these firms scaling up within the region rather than losing them to other countries such as the USA.”
MedCity was launched by the Mayor in partnership with London’s three Academic Health Sciences Centres to promote and grow the world-leading life sciences clusters of London and the greater south east, and to support both international companies and home-grown entrepreneurs do business in the region. In its first year, it has focused on access to investment for life sciences companies at all stages of growth, from launching Angels in MedCity which has so far brought together around 100 potential investors for early-stage life sciences companies, to holding the inaugural Future of Healthcare Investor Forum in partnership with the London Stock Exchange to raise awareness of opportunities in life sciences to generalist investors and brokers.
MedCity is also working with the Mayor of London to position London as a test bed for innovative new models for life sciences investment, with options under consideration including the establishment of a ‘megafund’ of up to £10bn. Following the initial roundtable in June, which brought together representatives of industry, investment and the research base, discussions are underway and a steering group is being established.
Other activity includes positioning London as a leading centre for digital health research and entrepreneurship, and supporting entrepreneurs and emerging companies to understand the route to market, for example by mapping innovation adoption paths in the National Health Service. It is also working with companies to help them find the right accommodation, partners, and expertise in the region, as well as guide them through the regulatory frameworks.