UK Life Sciences Sector Boosted By Raft Of New Policy Measures

A new policy document from the U.K. Government makes the life sciences sector a major focus for changes aimed at facilitating industrial growth. Marie Manley and Dr. Kwabena Tenkorang explain the relevant proposed changes, including reforms to speed up clinical trials, regulatory reforms, the introduction of low-friction procurement and the creation of a Health Data Research Service.

On June 23, 2025, the United Kingdom (“UK”) Government published a policy paper on “The UK’s Modern Industrial Strategy” (“Industrial Strategy”), a 10-year plan aiming to increase business investment and grow the industries of the future in the UK, in particular clean energy, artificial intelligence and life sciences. The Industrial Strategy will make it quicker and easier for businesses to invest and will provide the certainty and stability needed for long-term investment decisions. One of the key objectives is to maintain and further develop the UK life sciences sector, establishing it as a leader in Europe and the third largest life sciences sector across the globe (after the U.S. and China).

The UK government recognizes the importance of the life sciences sector, in particular pharmaceutical products and medical devices, for the UK economy. This is illustrated by the establishment of life sciences clusters in strategic locations like Cambridge, London, and Oxford, where relevant scientific expertise and high technologies are concentrated. Based on the policy paper, the UK government is eager to ensure that the UK continues to offer the best platform for innovation and investments by supporting ‘world-class’ R&D. To achieve this aim, the UK government has put forward the following key measures:

• Reforms to speed-up clinical trials

Implementation of the recommendations in the ‘O’Shaughnessy Review’ of commercial clinical trials is aimed at reducing trial approval times to under 150 days. The reforms also aim to double commercial interventional trial participants by 2026.

• Streamlining regulation and market access

The Medicines and Healthcare products Regulatory Agency (“MHRA”) needs to become a faster, more agile regulator, and optimize the existing new procedures such as the Innovative Licensing and Access Pathway, providing joint advice with key players such as the National Institute for Health and Care Excellence (“NICE”), the National Health Service (“NHS”) England, and the Clinical Practice Research Datalink. For further information on these joint procedures, see this recent Sidley Global Life Sciences blog post. International recognition procedures for both pharmaceuticals (introduced in January 2025) and medical devices (announced in May 2024, but not yet in force) will further enhance the MHRA’s efforts to facilitate quicker market access.

• Introducing low-friction procurement

Simplifying and streamlining the route to procurement by making the process less bureaucratic and providing easier access to the NHS through a rules-based pathway for MedTech and an NHS ‘Innovator Passport.’

• Public-private strategic partnerships

The expectation is that expanding partnerships with the industry will increase growth. The UK Government will aim to secure at least one major strategic partnership annually with a leading life sciences company. An example is the collaboration with Eli Lilly, set out in an October 2024 memorandum of understanding. It envisages Eli Lilly-backed ‘innovation accelerators’ being established for early-stage life sciences companies. There will also be a support service to help 10-20 high potential companies scale up their businesses and attract investment.

• Establishing a Health Data Research Service (“HDRS”)

The HDRS, set up by the UK Government in partnership with Wellcome Trust aims to enhance the use of the NHS data for research, will receive up to £600 million in investment from the UK Government to enhance data collection and storage. It is believed that this will increase the NHS’s ability to attract global investment and clinical trials. The aim is to transform the NHS into a magnet for investment, especially for AI investors.

• Life Science Innovative Manufacturing Fund

The fund will produce up to £520 million in investment for the manufacturing sector. This is aimed at increasing supply chain security by improving the UK’s independent manufacturing capability.

The policy paper also discusses broader, non-sector specific reforms, which will have an impact on the life sciences sector:

• Reformed mandate for the Competition and Markets Authority (“CMA”)

The CMA’s new mandate provides for more advice and engagement with businesses. There has also been an increase in the threshold for subsidies that must be referred to the CMA for review, from £10 million to £25 million.

• National Wealth Fund involvement in life sciences

Expanding the mandate of the National Wealth Fund of £27.8 billion and considering the role it can play in life sciences.

• Review of regulatory environment with assistance of Regulatory Innovation Office (“RIO”)

The RIO is a new public body, established in October 2024. Its objective is to help position the UK as “the best place in the world to commercialize technologies” by working with regulators to address barriers holding back innovation and changing regulators’ attitudes and behaviors to be more pro-innovation. The UK Government describes the RIO as “central” to its ambition to create a pro-innovation regulatory environment. In particular, the RIO will aim to enable new technology applications to reach the market.

The Industrial Strategy and the measures announced by the UK Government are a good step in the right direction. However, it still needs to translate into actual improvements of the existing regulatory framework to secure investments and ensure that innovation continues to thrive in the UK. Some may say that this does not go far enough. The NICE health technology assessment and the ‘claw-back’ repayment for exceeding the budget are big hurdles for pharmaceutical companies, acting as a deterrent to entering the UK market.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.