Health tech clusters
- a special report

“Competitiveness through collaboration”

By Tony Jones, chief executive of One Nucleus

Looking back over 2021 and what that has meant for the Life Sciences industry then it would be impossible not to feel, as is the case across all sectors, that it was shaped by having to adapt and respond to the Covid-19 pandemic. Business practices changed for all when it came to deal making, workplace operations, collaboration and deal making.

Naturally, much has been debated around what normal will be when all restrictions are lifted. Will physical technology clusters play the same role? What does ‘Build Back Better’ or ‘Levelling Up’ actually mean when Government intention starts to be translated to action?

What will recruitment of top talent require? Will customers be looking to establish shorter (domestic vs global) supply chains? These are just some of the uncertainties the sector faces as we return to whatever normal will be. 

In such a landscape, it would be easy to feel everything will change, yet most likely there will be far more that stays the same than changes in my view. The fundamentals of the sector remain the same.

World class research generating innovative solutions to unmet health needs will always be what drives life sciences. Innovation being a contact, and very human, sport equally I feel means like-minded people will want to gather in-person, working and perhaps socialising together as they exchange ideas and throw down the gauntlet to their peers about how to solve a problem.

Many facets such as financing windows, regulatory changes, technology/therapeutic areas being in vogue may continue in their traditional cyclical nature. Continue yes, but that isn’t to say there won’t be progress and evolution of the sector and what it is achieving.

With growing knowledge and capability means we can do better, whether that is regarding patient outcomes, widening access or sustainability for example. 

Mindful that the fundamentals will not have changed that much, then technology clusters seem here to stay.

The challenge is perhaps more one of what, in an increasingly mobile world, the locations and individual organisations within them need to do to attract the best people to start and scale the activity. That in itself poses something of a chicken and egg question. Does talent flow to where there is investment or does investment flow to where there is talent?

The UK biotech industry secured fantastically high levels of investment in 2021. Growing by over 60% year on year to £4.5Bn received in public and private financings.

This is testament to the rich innovation pipeline created through sustained Government investment in leading academic centres, supporting innovation by SMEs via the Biomedical Catalyst and offering tax incentives such as the Patent Box and R&D Tax Credits. A track record of translating that pipeline into a diverse asset pipeline to attract Pharma and venture investors has never been better exemplified than by the Greater Cambridge cluster.

The past year has seen local companies such as Artios Pharma (£110M), Alchemab ($82M), Phoremost ($46M) and Bit Bio ($103M) raising enormous sums to develop their pipeline and their respective companies.

Bring into that mix the array of corporate deals such as Kymab-Sanofi and AstraZeneca-BenevolentAI and the thriving academic research base comprising the universities, research institutes and NHS, it is not difficult to see why the cluster has >450 life science companies located here. That dynamic creates a hugely diverse asset list to attract even further investors, innovators and entrepreneurs and the future feels bright. 

Diversity is no doubt a major benefit, not just in terms of a life sciences asset, but a major reason for being such an innovation powerhouse is the region’s scientific and technology diversity.

The cluster capitalises increasingly on the success of our near neighbours in Oxford, London, Silverstone, Stevenage and Norwich for example. I am hesitant to speak of a ‘supercluster’, but in global terms the proximity and growing connectedness of recognised centres of excellence in areas including cell & gene therapy, microbiome research and digital health bodes well for 2022 and beyond.

The importance of interdisciplinary collaboration in the discovery and development of innovative medicines and health technologies is growing at a rapid pace. Moving towards a more integrated R&D and healthcare delivery environment, capitalising on the progress in data science, artificial intelligence, wearable technologies, materials science and more has never been more interconnected to deliver better patient outcomes. 

The ability to attract scientific and business leaders from the globe who all seek partners to help them change the globe on which we live makes this ecosystem so valuable (and valued).

It majorly contributes to the UK holding its own impressively when compared to other global hubs in the US, Europe and Asia, particularly in the start-up and early-stage company phase.

One might as yet question the competitive position when it comes to later stage scale up and true commercialisation.

We need more! And what of harnessing the value of key clusters such as the East of England’s for the greater ‘UK plc’ good.

The goal of any industrial strategy created by policy makers must surely be to scale and spread their increased economic activity and consequential societal benefits across its population - levelling up some may call it. 

Seeing what has worked in these recognised innovation hot spots the temptation could be to try and replicate or clone such clusters to rejuvenate currently less successful locations.

That ignores the complexity of these ecosystems and fails to celebrate difference and diversity. Clusters have an inherent personality.

A location that attracts the inventors and entrepreneurs required for early-stage success may not have the same attraction to those talented individuals more drawn product development and manufacturing disciplines. That brings up another myth. Innovation is often associated with ideation phase of the new.

It is essential that innovation happens at all stages of the process, through development, manufacturing and distribution if the best returns are to be harnessed from the whole lifecycle.

So it’s not about creating the same innovation ecosystem, but more about creating an innovative ecosystem that suits that location.

Here history matters if it is not only to attract talent from elsewhere but also raise the career aspirations and wealth creation opportunities for the residents.

If an area has been traditionally very industrial, then one might expect its ingrained personality is to embrace world class innovation in development and manufacturing to its soul.

Attracting the intellect and talent driven by innovating in better processes at that phase of the product lifecycle. Residents will see the growth as ‘jobs for people like us’ rather than resenting being squeezed by inward flowing talent that drives factors like house prices and congestion up. 

Whilst technology is changing at an unprecedented rate, clusters that give rise to those technologies one might argue evolve much less quickly.

Perhaps taking decades if not centuries to have reached where they are.  It is the magnetic effect of these clusters to attract like-minded people that fuels them and the characteristic that must be maintained.

Afterall ‘a place is only as good as the people you know in it. It’s the people that make the place.’ (cf Pittacus Lore). All stakeholders are primarily motivated by wanting to see re-energised clusters in a joined-up UK economy with reduced disparities in e.g. life expectancy between places in a sustained way.

It is excellent therefore to see visions being written not for a short-term fix of government investment but to truly increase the attraction of those locations to further (private) capital.

Converting those visions to practice have to be plans that engage all stakeholders, whether already there or that are targets to attract to the cluster. Like any value chain, if any stakeholder in that chain does not see benefit, then it is hard to deliver the maximum outcome.

That brings me back to the need to create ‘jobs for people like us’. A phrase I hear frequently from those not involved in life sciences whenever I am championing its potential for inclusive growth. 

As a not-for-profit life sciences membership group with >400 corporate members, One Nucleus works closely with our members, stakeholders and peer groups to enable their success.

Established in 1997 we are headquartered in Cambridge, UK which has long been held up as an exemplar of the cluster effect by many metrics.

We provide support services such as a Purchasing Scheme that saves members >£3M per year, Learning & Development courses to develop employees, Events from roundtables to large conferences and Seminars in best practice forums on everything from HR to new medicine formulation.

We support those institutions, companies and individuals undertaking activity in or with the above region. See https://onenucleus.com/ 

The UK has immense strengths across all aspects of the life sciences R&D (and Manufacturing) spectrum, that complete spectrum is not always found in one geographical region.

Remembering the UK is not that large a location in global standards, and when we slice that into regional clusters then it is clear we need to collectively make the best use of the capacity we have.

For me, it’s a little like an airport that needs to not occupy all its capacity on short-haul flights when long-haul can bring larger margins, but it does need to serve its resident customer base and community.

At a very top level we see the strengths in the South East and areas of the North West in Biopharma and healthcare research, we see much publicised product development strengths in the Midlands and very strong Medical Technology strengths in several areas and so on.

Excellence is located everywhere and the areas I mention above are not one-dimensional by any means, so collaboration within and between clusters is key. As indeed is attracting international collaboration in this field. 

The UK is fortunate to have strong national trade associations such as the BIA, BIVDA, ABHI and ABPI who have proven they work well with Government. In an ideal world, each region of the UK will bring its a-game to the UK table, increasing the UK global competitiveness through collaborating.

Creating innovation capacity and over-arching semi-specialisation at a regional level, along the lines of the Technopoles created in France in the past, could facilitate such UK growth.

In such a landscape the flow of invention, innovation and prototype-to-product production line could unite a nation, enable social mobility, attract inward investment and drive growth in the long term.

Far from competing to all attract and grow the same things, celebrating our regional differences as we gather around the UK table can be an extremely compelling offer in making the UK the destination for those wanting to succeed in Life Sciences.