Chancellor Jeremy Hunt has announced a series of measures detailed within the UK’s Autumn Budget to boost the life sciences sector, including a £520m funding commitment for manufacturing.
The Association of the British Pharmaceutical Industry (ABPI) has welcomed the measures, with ABPI chief executive Richard Torbett saying that Hunt has “recognised the high potential of UK life sciences to deliver the jobs and growth the country needs”.
“This package of support will help boost our sector’s investment in UK-based research and manufacturing,” Hunt added.
As part of the government’s £4.5bn investment over the next five years to attract investment into strategic manufacturing sectors, the new package will be used to advance life sciences in the UK, including manufacturing, clinical research and the fiscal environment.
As part of the package, a new merged research and development (R&D) tax credit scheme has been introduced, combining small and midsize enterprises (SMEs) and the R&D expenditure credit (RDEC), to reduce it from 25% to 19%. This will support a further 5,000 R&D-intensive loss-making SMEs.
In addition, Hunt has also announced that the full expensing will be permanently applied to businesses as opposed to the original three years, marking it as the largest business tax cut ever seen in the UK.
Steve Bates, chief executive of the BioIndustry Association also welcomed the measures, saying that the increased flexibility in the tax relief scheme for R&D-intensive companies “will make a meaningful difference to company growth, job creation and accelerating the delivery of new medicines to patients”.
The full expensing will mean that for every one million pounds invested by a company, they will receive £250,000 off of their tax bill in the same year.
A total of £500m will also be funded into innovation projects over the next two years to help advance the UK’s artificial intelligence (AI) abilities and £50m in additional funding for engineering investments to support UK innovation and technology sectors.
Additionally, the Our Future Health patient data programme will receive £51m to identify ways to prevent, detect and treat disease.