Taking a Closer Look into the Life-Science Funding Landscape in Europe and the United Kingdom

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The author looks at how life-science research has evolved in Europe and the United Kingdom, and discusses the current funding opportunities for SMEs.

In recent decades, life-science research has evolved and continues to do so. This revolutionary work has led the way to innovative discoveries allowing the industry to grow and progress at a phenomenal rate. However, given pressure on large pharmaceutical companies, major global healthcare challenges and economic conditions, small- to medium-sized enterprises (SMEs) face significant challenges in accessing sufficient funding to support the development of innovative products. Through a number of sources, businesses can secure funding via; government agencies, private non-profit organisations & charities, industry and via equity and venture capital. Investment in both early stage and translational research and development is key in life science and securing of funding at each stage of development is a core requirement. This article will attempt to delve into some of the issues faced by SMEs and the current opportunities available to address funding challenges.

Public sector funding

The economic downturn in 2008 led to many government budgets being cut, with some expecting the decline to continue over the coming years. With funding potentially limited, there is a view from some life-science researchers that certain areas, such as translational research and clinical research, appear more likely to receive funding than early stage research where the investment risk is much greater. In addition, funding is expected to become more concentrated around centres of excellence, making it more difficult for some institutions to access resources (1).

It has also been widely reported in Europe that there are difficulties in attaining funding from the public sector on a scale and duration that can have a significant impact upon the sector (2). Scientific research is an evolving process that inevitably needs sustained resource. It does not lend itself to being constrained to a quantifiable timeframe for results to be published and measured.

Historically, the United Kingdom is second only to the United States in terms of research output for new drug candidates. The UK has the Biomedical Catalyst programme, which has invested more than £150 million into this area. In October 2010, the British government announced that £200 million would be invested in a network of elite technology and innovation Catapult Centres, including significant investment in facilities and infrastructure for the life sciences (3). The Catapults are an important and integral part of the UK’s innovation system to bridge the gap between universities and business, giving access to state-of-the-art equipment, expertise, and new funding streams, which help to commercialise the outputs of Britain’s world-class research base. Businesses will be able to access the universities’ expertise for R&D requirements, identifying new opportunities for working together and collaboration.

Funding from industry

The challenges facing Big Pharma regarding patent cliffs and other issues have been well documented elsewhere. As a result, pharma must look to collaborate much more and look to externalise more of its research. This presents a significant opportunity for SMEs in that it opens up both a significant source of potential funding for research and development but also a potential route to market should a successful collaboration lead to a licensing deal or even an acquisition. Larger companies are increasingly looking for new ways to catalyse their engagement with SMEs and many have developed initiatives that aim to foster deeper engagement and also allow them to engage with SMEs at an earlier stage. We have seen this with initiatives such as the BioHub at Alderley Park (4), which means that SMEs are sharing space with AstraZeneca employees.

With regard to equity and venture funding, investors can find it difficult to understand this sector and the associated risk profiles especially given that it takes many years to take a product through research, overcome regulatory barriers, and find a route to market. This means that many SMEs struggle to raise the finance required to reach the point where their proposition becomes attractive to major investors.

More access to funding through membership


By investing some time at an early stage to broaden their networks through the routes provided by membership organisations, SMEs are then able to benefit from the platforms in place to work in partnership and meet investors or find out more regarding funding streams. Companies seeking finance can be brought into direct contact with investors, charities and government bodies and also with those companies and individuals who already have a track record of raising finance. These platforms and organisations help to facilitate and develop relationships with potential partners for businesses and enable better understanding of the funding landscape in the life sciences sector.


1. Leica Microsystems, LifeSight Research Report 2014, www.leica-microsystems.com/lifesight, accessed 9 Dec. 2014. 

2. Jenny Rohn, “They have chosen ignorance,” www.theguardian.com/science/occams-corner/2014/oct/09/they-have-chosen-ignorance-open-letter, accessed 9 Dec. 2014.

3. Catapult Centres, www.catapult.org.uk/, accessed 9 Dec. 2014.

4. BioHub at Alderley Park, http://www.biohubatalderley.co.uk/, accessed 9 Dec. 2014.

For more information, please visit www.bionow.co.uk