A “battle within government” and inaction from the Treasury are being blamed for the UK’s worsening climate for pharmaceutical investment. A Sanofi executive described a situation where health and business officials are “sympathetic but hand-wringing,” unable to make a strong case for the sector to the UK’s finance ministry.
This lack of a unified and supportive government strategy is having dire consequences. The UK has recently seen MSD cancel a £1bn research facility and Eli Lilly suspend a new lab, both in London. These decisions represent a massive loss of potential jobs, innovation, and economic growth, directly linked to the poor commercial environment.
The industry argues that the Treasury holds the key to unlocking the situation. It is the Treasury that must approve a “proper plan” to increase the UK’s historically low spending on new medicines, which currently sits at just 9% of the total healthcare budget, far below competitors.
Until the Treasury commits to a new financial framework—one that includes updating pricing rules and lowering revenue clawbacks—companies are pausing investment. The pharmaceutical sector is making it clear that without a firm financial commitment from the top of government, the UK’s life sciences ambitions will remain just that: ambitions.