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UK Budget light on life sciences but more doors open for biotech startups. The UK Autumn Budget offered little in the way of new measures specifically for the life sciences sector, though incentives for early-stage businesses could help certain biotechs looking to establish themselves in Britain. At the heart of the government's aim is a new tax relief for founders looking to scale their companies in the UK. Called "Founders Relief", the framework will offer eligible founders of high-growth, innovative companies a reduced 10% rate of Capital Gains Tax on up to £10m of lifetime gains. This marks a steep markdown from the standard rate of 18%. There are several scaling, innovation, and business activity criteria that need to be met for a founder to qualify for the scheme. Reacting to the Budget, BioIndustry Association (BIA)'s CEO Chris Molloy said: "Although there is broad merit in the Founders' Relief, the initial inclusion criteria are more relevant to high street businesses, not high-tech, VC-backed biotechs. We shall be working with members and Treasury during the next month's consultation period to ensure the needs of biotech founders are well understood." Gail Vallis, corporate and life sciences partner at law firm Gardner Leader, disagreed, commenting: "This is great news for those taking substantial risks in setting up promising new companies, especially at the cutting edge of R&D in areas such as life sciences, but misses the mark for those who have taken the same risks on an existing early-stage company or those that have saved a struggling business. It will be very interesting to see what the qualifying conditions will be for a company to be considered high growth or innovative." Alongside the relief, people starting a business will have their trading allowance tripled to £3,000. The government said it would also improve venture capital (VC) schemes and simplify access to R&D tax reliefs, as well as making it easier for employees to own shares in the companies they work for. Chancellor John Healy announced a £20.4bn boost to the National Wealth Fund and British Business Bank (BBB). The latter is a key financing vehicle for British small and medium-sized enterprises (SMEs). Molley said: "We are pleased to see the Chancellor fuel the life sciences innovation engine through an increased and front-loaded budget for BBB that will back funders and companies across biotech and dual-use technologies." This Budget also brings new legislation to make non-compete clauses less of a barrier for startups and scaling firms to attract talent, with guidance slated for release in early 2027. The government said the steps will help achieve its ambition in making the UK "the best place in the world to start a business, scale it, and stay here for the long term". One of the few life science-specific announcements was a series of public-private investments worth over £1bn, though only £70m of this was backed by government grants. US biopharma Vertex Pharmaceuticals is opening a new £300m facility in Oxford, medtech specialist Convatec is investing over £500m over the next decade in a new R&D hub in Manchester, and CDMO Kindeva is pumping £200m at its base in Loughborough. Vallis commented: "£70m of grant funding is fantastic too, but that won't go far for companies looking to take their drugs through clinical trials. Work is still required to attract investors to invest more widely across the sector." The Budget comes at a time of renewed hope in the UK's biotech sector. A report released this week by the BioIndustry Association (BIA) has found that the UK is likely on track to post its best year since 2021 for biotech VC acquisition. As the British life sciences funding scene looks to get back to winning ways, M&A has already seen notable success so far this year, with three acquisition deals above $1bn of British biotechs in 2026. The most expensive of these was Eli Lilly purchasing sleep drug biotech Centessa Pharmaceuticals for up to $7.8bn in June. However, the wait for a biotech listing in the UK this year goes on, reflecting hesitancy around the nation's wider macroeconomic health. Give your business an edge with its leading industry insights.

UK budget includes £1bn biopharma investment package. Among the highlights of UK Chancellor John Healey's first Budget was more than £1 billion in investment by Convatec, Vertex Pharmaceuticals, and Kindeva, supported by £70 million in government funding. Medtech firm Convatec has agreed to invest more than £500 million over the next 10 years to build an R&D hub in Manchester for products used in wound care, ostomy, continence, and infusion care products, which is due to open in early 2028. The facility will be located at the Citylabs SciTech campus and will house roughly 200 workers, with some transitioning from Convatec's older Deeside site, alongside newly created local positions. Meanwhile, Vertex has pledged over £300 million to develop a brand-new facility in Oxford focusing on medicines research and pharmaceutical innovation, and drug delivery specialist Kindeva is planning to spend £200 million in Loughborough to boost local drug delivery development and manufacturing capabilities Overall, it is expected that the investments will support more than 1,000 jobs across regional innovation hubs, according to Kenan Poleo, director of the UK Office for Life Sciences (OLS). "These numbers matter. But what matters even more is what sits behind them: companies choosing the UK to invest, innovate and grow, talented people getting high-quality jobs, and patients ultimately benefiting from new treatments," he added. "Lots still to do, but today is another important vote of confidence in UK life sciences." The Association of the British Pharmaceutical Industry (ABPI) welcomed the investment, along with the government's maintaining the corporation tax cap at 25% and maintaining full expensing - a tax relief that allows companies to deduct 100% of their spending on qualifying plant and machinery from taxable profits in the year the purchase is made. The trade body said it was also pleased by new powers under the Regulation for Growth Bill to test innovative products, including medicines and medical devices, in a supervised, time-limited, live-market environment. VAT move on free medicines applauded. Another key development was the closure of a VAT loophole that has made it difficult for pharma manufacturers to make medicines available to patients for free. The longstanding issue was the policy of HM Revenue and Customs (HMRC) to treat free-of-charge medicine supplies as "deemed supplies" or barter transactions and so subject to a 20% VAT charge, even though no money changed hands. That means that, until now, companies could face a VAT bill on medicines they provided without receiving any payment. Drugmakers mainly provide drugs for free to patients in the context of early access programmes for those that address an unmet clinical need, compassionate use for patients who have exhausted other treatment options, or post-trial care that plugs the gap between the end of studies and a medicine becoming approved and funded by the NHS. In some cases, companies agree to make a medicine available for free to the health service while further evidence of benefit in real-world settings is gathered. "Removing the VAT charge on medicines that companies provide free of charge is a significant win for patients, lifting a barrier to access, protecting continuity of care and supporting the clinical research that brings new treatments to the UK," said Joe Edwards, executive director for UK competitiveness at the ABPI. "We support this measure, which follows sustained work by patient groups, the ABPI and our members to inform this change," he added. "We will keep working together to ensure the relief is simple to use and covers the full range of programmes that matters to patients." 29 October, 2026

£300m Oxford biotech facility among Budget initiatives unveiled for South East. 28 Oct 2026, 15:59 A "cautious" first Budget from the Chancellor nonetheless featured a number of developments for the South East - including major funding for biotech, where the region excels. This year's full Budget document included news that American biotech Vertex Pharmaceuticals will invest more than £300m in a new 155,000 sq ft research facility at Harwell Campus in Oxfordshire. Construction of the facility, which is hoped will help accelerate the discovery of transformative medicines, is slated to begin in early 2027 and will support more than 200 jobs. The initiative was one of three public-private investments unveiled in the Budget, totalling more than £1bn and backed by almost £70m in grant funding. The Oxford-Cambridge Growth Corridor, much touted over the past year, was given another nod as the government confirmed it would pilot a new financing model for the Greater Cambridge Development Corporation, "giving it direct access to government finance for land assembly and to invest alongside private partners". A consultation is to be launched on a development corporation in Oxford "by the end of the year", with a similar pilot planned for the city. The Chancellor also pledged more than £75m to the CoSTAR network of labs anchored in Buckinghamshire and Surrey as well as Yorkshire, Dundee and Belfast. There was no news in the Budget on a third runway at Heathrow Airport as "the government works at pace to consider responses to the consultation", with an update promised "as soon as possible". Meanwhile, debt relief of £500m from the Public Works Loan Board (PWLB) was confirmed for the beleaguered Woking Borough Council.