British life sciences raise £20bn after Covid-19 successes spur interest

More cash was funnelled into companies developing vaccines than ever before last year

British life sciences companies raised £20bn last year, almost a quarter more than in 2019, after Covid-19 acted as a “catalyst for growth”.

The figures, compiled for Savills by PitchBook, found that the UK came fourth in the list of which countries experienced the most investment into life sciences.

London, Cambridge and Oxford proved particular hotspots for funding last year, with businesses headquartered in the three cities responsible for raising around £4.6bn of capital.

Work on vaccines attracted the bulk of investors’ attention last year, as more cash was funnelled into vaccines than ever before. On a global basis, £2.7bn was invested into companies working on vaccines. This was more than double the 2019 figure.

Steve Lang, a director in Savills’ research team, said: “Whilst Covid-19 has undoubtedly acted as a catalyst for growth, the scale of capital raised via private equity, venture capital and initial public offerings has reached a staggering £1.8 trillion in the past five years alone. This has seen life sciences appear far more prominently on investor’s radars. 

“What’s more, as a relatively ‘pandemic-proof’ sector, with occupiers continuing to work, a greater need for laboratory floorspace and the higher security of rental income its popularity is only set to continue into 2021.”

Already, in the UK, projects are underway to increase the amount of space available to life sciences ventures. Last year, ministers fast-tracked the development of the national Vaccine Manufacturing Innovation Centre (VMIC) in Oxfordshire. It is now expected to complete this year. 

Dr Matthew Duchars, chief executive of the £158m “super-factory”, told the Telegraph earlier this month that it would be able to produce 70 million doses of an emergency vaccine within a four to five month period once it opens later this year.

“New Covid variants are absolutely part of the thinking. We probably will need to make seasonal vaccine variants because there may well be mutations in the virus, as well as vaccines for other diseases. You never know what’s coming next.”