The UK life sciences sector has suffered a significant setback. US pharmaceutical giant Merck has abruptly cancelled its planned £1 billion London research centre. This decision represents a severe UK life sciences blow. Consequently, the company will eliminate 125 scientific jobs in the capital this year. The lab was already under construction near St Pancras station. It was scheduled to open in two years and eventually employ 800 people.
Moreover, Merck will vacate its existing London laboratories. It will leave the London Bioscience Innovation Centre and the Francis Crick Institute. The company, known as MSD in Europe, attributed its reversal to longstanding issues. Therefore, it cited a lack of meaningful progress in UK life sciences investment. It also pointed to the overall undervaluation of innovative medicines by successive governments. This announcement is a profound UK life sciences blow.
Furthermore, this move reflects broader industry frustrations. Lengthy negotiations between the government and drugmakers recently broke down. The UK’s medicine rebate rate rose to 23.5% in 2023. This figure far exceeds rates in France and Germany. Moreover, Merck will move its research operations to other global sites. Pharmaceutical companies face pressure from Donald Trump to invest more in the US.
Additionally, a new report confirms a troubling trend. Investment in UK life sciences R&D has underperformed since 2018. Foreign investment plummeted by 58% between 2017 and 2023. Furthermore, the UK fell from second to seventh place in global investment rankings. The rate of growth in R&D spending slowed dramatically. It now lags significantly behind the global average.
Industry leaders expressed deep concern. Richard Torbett of the ABPI called Merck’s decision a real blow. He warned the UK risks losing out to more competitive countries. The UK ranks poorly in providing new medicines to patients. Only 37% of new medicines are fully available. This compares to 90% in Germany. Over 60 medicines were delayed or not launched recently.
The government responded by highlighting the UK’s attractiveness. A spokesperson referenced a Deloitte survey and the US trade deal. They acknowledged more work is needed. The government aims to make the UK a leading life sciences economy in Europe by 2030. However, Merck’s withdrawal underscores the immense challenge ahead. This UK life sciences blow highlights the urgent need for a more competitive environment.
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