Moving research out of the lab is key to UK life science success

As we approach the first anniversary of the government’s Life Sciences Sector Plan, it has been a bumpy 12 months. The UK remains one of the world’s strongest producers of biomedical research, but industry confidence has been unsettled. In 2025, three of the world’s biggest pharmaceutical companies – Merck, AstraZeneca and Eli Lilly – paused or withdrew UK investments totalling £2 billion, before AstraZeneca eventually recommitted £300m to sites in Cambridge and Macclesfield in April 2026.

This instability is unhelpful as government seeks to reinforce the UK’s position as a global life sciences leader. There are some complex economic factors at play, and the challenge is heightened by fierce international competition: the United States and China are investing heavily in the capital and infrastructure needed to turn discovery into viable products and thriving businesses.

The Life Sciences plan aims to make the UK the world’s third most important life sciences economy by 2035. To get there, we will need to be bigger and bolder at commercialisation to compete with heftier world economies.

Why University Research Drives UK Health Innovation

As Vice-Chancellor of one of our leading research universities, I am passionate about the role universities must play in this strategy. The UK’s globally respected higher education sector is indisputably one of government’s strongest assets when it comes to our competitive edge.

Universities power much of the UK’s health innovation pipeline. Renowned breakthroughs such as the Oxford-AstraZeneca Covid vaccine, MRI scanners and IVF treatment all emerged from university research. 

Too often, our world-leading universities are still depicted as ivory towers, detached from everyday concerns. The reality of a modern-day university couldn’t be more different. Across our campuses, innovators and entrepreneurs ensure excellent research does not sit on a shelf in a laboratory, but moves into boardrooms, hospitals and factories, improving lives across the UK and beyond. This month alone I was delighted to see that Gnosis Health, a joint spinout from Newcastle and Plymouth Universities, secured £1.1m to scale up its digital health technologies that are transforming the way Parkinson’s patients manage their condition.

University Spinouts Are Powering the UK Biotech Sector

University spinouts are now one of the main routes by which early scientific ideas enter the commercial ecosystem. There are currently more than 560 active life sciences companies which have emerged from the 24 Russell Group universities alone, attracting an estimated £3 billion a year in private investment. They are developing therapies and technologies for health challenges ranging from cancer care and organ transplants to lifelong neurological conditions like Tourette’s, while also creating jobs and driving growth across all four nations of the UK.

Building on these strengths, Russell Group universities have committed to helping raise that investment to £5 billion by 2030, supporting a wider sector ambition to double external investment into university innovation by 2035. Universities like ours are particularly effective at leveraging private capital: the UK may lag behind some competitors on the share of R&D funded directly by business, but it performs strongly – fifth in the OECD – when you account for R&D financed by business but actually carried out by universities.

But significant barriers remain, and overcoming them will require universities, government, business and health services to work together.

Investment Is Essential to Scale Scientific Innovation

One persistent challenge is early-stage commercialisation. Once ground-breaking research has been translated into a fledgling company, entrepreneurs need an initial injection of investment to progress from proof-of-concept to commercial viability. As the AstraZeneca rollercoaster demonstrated, investors need confidence before they commit – as true for a venture capitalist backing a spinout as it is for a pharmaceutical giant committing to a major facility.

Universities have made real progress in strengthening the spinout environment recently, by upskilling academics in entrepreneurship and improving equity deals for founders. But institutional efforts alone will not be enough. Investment conditions, regulatory clarity and the capacity of health systems to adopt technologies at scale will determine whether the UK can convert more of its scientific strength into patient benefits and economic returns.

Spinouts are high-risk, high-reward investments. They can be highly lucrative, but in the UK returns can take a decade . That’s why de-risking early investment matters. Targeted government support would help, but in a tight fiscal climate our sector will also need to step up, through co-investment from universities or private sources such as university-affiliated patient capital funds. Through Universities for North East of England, we’ve done just that with the launch of a £22.5 million Spinout Inspire Fund, backed jointly by the North East Mayoral Strategic Authority and the region’s five universities. By providing early-stage capital for university spinouts, it directly addresses one of the biggest barriers facing founders: securing investment at the point where ideas are proven but not yet ready to attract large-scale private backing. If successful, it could provide a model for other regions seeking to translate research excellence into economic growth.

Turning Research into Real-World Healthcare Solutions

Investment is one end of the pipeline; adoption is the other. In support of the Russell Group’s Healthier Communities campaign, I recently chaired a discussion at Newcastle University on shaping health innovation in the North East. Representatives from NHS Trusts, the Integrated Care Board, local government, spinouts and third-sector organisations all agreed that adoption and implementation can be frustratingly slow.

There are a number of reasons: limited NHS capacity, a gap between the expectations of innovators and users that makes translating benefits challenging, and the political pressures that shape difficult policy choices. All of which points to the urgent need for universities and our partners to tell a better story on why all of this matters – to investors, to ministers and to the public at large. If we want government to back us financially at a time when there is very little spare room in public finances, we must make a strong case for why we are indispensable partners in delivering both better health outcomes and economic growth.

Unlocking the UK's Life Sciences Potential

If the UK is to remain a global leader in life sciences, our research strengths must be matched by an equally ambitious system for turning discoveries into ventures that can attract capital and scale up effectively – not only transforming clinical practice, but creating new jobs and building more resilient regional economies. We have all the pieces on the chessboard; now the task is playing them strategically to get results.