Industrial Strategy: what does it mean for digital health SMEs?

“The UK is one of the best places in the world for cutting-edge science and technology,” writes Sarah Haywood, CEO of MedCity in this blog. “The Government’s commitment to knowledge-based sectors in the recent Industrial Strategy will ensure we continue to be at the forefront of innovative research, tech and development of new treatments.”

Although we will have to wait and see what new money is coming into the sector, it’s great to see the confidence placed in The Golden Triangle, as some of the biggest names in Pharma pledge to work and invest here.

London’s tech sector is the largest in Europe and the south east of England is fertile territory for digital health entrepreneurs, with one of the most business-friendly regimes in the world, a strong talent pool, world-class facilities, and access to the NHS.

There are so many exciting digital health projects at the moment, with the pioneering 100,000 Genomes project headquartered at Queen Mary University of London; companies such as Cambridge Medical Robotics leading the way in next-gen robotics; and companies on the DigitalHealth.London’s Accelerator making waves in the NHS, such as DrDoctor, Echo and 11Health.

I have taken a look at the Government’s Industrial Strategy to see what this means for health tech companies.

What is the Industrial Strategy White Paper?

The White Paper is the Government’s plan to create an economy that boosts productivity and earning power throughout the UK. It’s based on consultations with key sectors, and took on board the recently published Life Sciences Industrial Strategy report led by Sir John Bell.

The vision is to create the world’s most innovative economy, quality jobs and greater earning power, a major upgrade to the UK’s infrastructure, the best place to start and grow a business and prosperous communities across the UK.

Also recently released was the Life Sciences Sector Deal, which details collaborations between 25 companies and the UK, to drive growth in the sector.

What does this mean for digital health companies?

R&D investment: The Government has committed to raise total R&D investment to 2.4 per cent of GDP by 2027 and increase the rate of R&D tax credit to 12 per cent. This ramping up of spending ensures we don’t get left behind in the race to deliver new products and devices in areas such as genomics, Big Data, and robotics.

Infrastructure: Digital infrastructure will be boosted by £1bn of public investment, including £176m for 5G and £200m for local areas to encourage roll out of full-fibre networks. The new ‘Transforming Cities Fund’ will provide £1.7bn for intracity transport; funding projects that drive productivity by improving connections within city regions. For example, those that are based in Cambridge South, will benefit from a new railway station and connections with Oxford along a new expressway, making it easier to collaborate and meet with patients and stakeholders.

Innovation Hubs: In response to the life sciences review, the government will develop a number of regional Digital Innovation Hubs to support the use of NHS data for research purposes. It is proposed that these would each cover three to five million people and contain comprehensive and secure data in primary, secondary and tertiary care as well as social care and community data.

What Sector Deals have been made?

Long-term strategic deals are being made in four sectors seen as having growth potential, including life sciences and artificial intelligence. The strategy aims to bolster the relationship between Industry and academia and includes a number of collaborations and developments:

  • Janssen Pharmaceutic NV, part of Johnson & Johnson, and the University of Oxford are collaborating for novel clinical trial methodologies in mental health
  • GSK is to invest £40m into genetic research at its global centre in Stevenage
  • Investment by MSD in a UK Discovery Centre in London which could support up to 950 jobs
  • AstraZeneca will base its £500m global HQ at Cambridge Biomedical Campus, coming up next year
  • Novo Nordisk announced a £115m research centre at University of Oxford, aiming to discover new medicines to treat people with Type 2 diabetes.
  • Major companies including Philips, Roche Diagnostics and Leica are in discussion with the government and the NHS to develop a trail-blazing digital pathology programme using artificial intelligence. A similar programme is being explored with the sector in radiology where we have had interest from Philips, Siemens, GE Healthcare and Toshiba Medical Systems
  • A £14m investment from the industrial strategy challenge fund to support medicines manufacturing, including a vaccine development and manufacturing centre and an expansion of the Cell and Gene Therapy Catapult’s manufacturing centre in Stevenage.
  • The Academic Health Science Networks also got a mention, as providers of national and local support for innovation, ensuring innovators can access the support they need and a new scheme will support small and medium-sized businesses in developing an effective evidence base for their products.
What’s next?

I am pleased to see the UK’s genomics industry is in the spotlight, with a partnership between GSK, AstraZeneca and the Government to contribute to the whole genome sequencing of the UK Biobank, building on the work of innovative companies such as Cambridge Epigenetix, Genomics plc and Congenica with Genomics England. The UK is uniquely positioned to be the global leader in this field, and as the price of genome sequencing falls, the UK can create even larger datasets, and NHS England plans to introduce whole genome sequencing as part of the genomic testing directory. Patients will benefit from earlier, more accurate diagnosis and more effective treatments. Continuing to grow and invest in these large-scale research platform assets will result in major UK successes in this field.

With life sciences being one of the UK’s fastest developing industries and a new tech company being founded every day, it makes sense to exploit and build on our existing strengths to increase the pace of economic growth, and put us in a world-leading position in terms of health technology.

Whilst the Industrial Strategy and Sector Deal has introduced some of the recommendations put forward by the Life Sciences sector, there is still more to be done to sustain our industry and we are working alongside the Mayor of London to push for increased investment opportunities, an immigration system that works for the sector, and the appointment of a dedicated Life Sciences Minister. I also expect to see more information in 2018 about how the Industrial Strategy Challenge Funds will be used by organisations like Innovate UK and the National Physics Laboratory to support innovation and companies. MedCity will ensure that these opportunities are communicated as widely as possible, so keep your eyes open for new funding calls in the next year.

Find out more about MedCity at

Digital health companies can find funding opportunities here.