What does the UK government's ambitious sector plan for life sciences mean for the industry?

The UK government has published its sector plan for life sciences setting out a comprehensive roadmap that aims to transform the UK into Europe’s leading life sciences economy by 2030 – and the third most important globally by 2035, behind the US and China only.

The sector plan, which is one of eight underpinning the government's new industrial strategy, is framed around three core pillars: enabling world class research and development (R&D), creating a robust business environment and growth, and driving health innovation and NHS reform.

Recognising the ongoing challenges facing the sector, including competition for investment and bureaucratic red tape, the government proposes a series of detailed reforms designed to remove barriers that have historically held the sector back, accelerate innovation "from the lab bench to the bedside" and strengthen the clinical trials ecosystem to support NHS priorities.

The plan is backed by a detailed timeline and concrete action points, indicating a high degree of accountability and a busy few years ahead for the government, regulators and industry alike. Whether the plan will be fully realised remains to be seen.

Enabling world class R&D

The government has committed over £2 billion in investment, supplemented by funding from UK Research and Innovation (UKRI) and the National Institute for Health and Care Research (NIHR). Key proposals include:

Establishment of a Health Data Research Service: with a view to encouraging global clinical trials and harnessing AI investment, the Health Data Research Service aims to develop the world's most advanced secure and AI-ready health data platform to host genomic, diagnostic, and clinical data at population scale.

Investment in manufacturing: the plan allocates £520 million to be invested into the manufacture of medicines and advanced therapies, including through the Life Sciences Innovative Manufacturing Fund (LSIMF), to increase resilience within the sector, create job opportunities and bolster UK supply chains.

Streamlining regulation and market access: regulatory inefficiencies have long been a source of frustration for life sciences companies, particularly in the post-Brexit era. The government commits to enabling the Medicines and Healthcare products Regulatory Agency (MHRA) to become a more agile regulator through joint advice and parallel approvals with the National Institute for Health and Care Excellence (NICE).

Policy and legislative changes: through these changes, the government aims to accelerate access to health data for research and other secondary purposes and streamline governance processes to maintain core safeguards (with cybersecurity principles embedded therein) while ensuring efficiency. Changes will be supported by a programme of public engagement alongside consultation with healthcare professionals.

Improve commercial trial participation: by cutting unnecessary red tape and standardising contracts, the government aims to reduce the set-up time for commercial interventional clinical trials to less than 150 days by March 2026.

Advancing UKRI offering to SMEs: the UKRI will enhance its support for biotech and medtech small to medium-sized enterprises (SMEs).

Building new digital connectivity: emphasis will be placed on building new digital connectivity to increase the speed and scale of real-world evaluations of AI, genomics, prevention, and personalised medicine.

Business environment and growth

While R&D is fundamental to innovation, the government recognises that innovation without scale is futile. Scaling up has been a significant obstacle for many UK-based biotech and medtech companies, particularly in the transition from early-stage funding to Series B and later rounds.

The government proposes a series of initiatives that focus on access to finance, skills, manufacturing, net zero and high-value strategic partnerships – aiming to create an environment where new ventures can grow and remain in the UK. These include:

Continued development of the British Business Bank’s offering: commits to an additional £4 billion of industrial strategy growth capital to support investment and growth as well as the publication of its venture capital investment return data.

Dedicated support for life sciences SMEs to export: this will involve working closely with UK Export Finance, the UK's export credit agency as well as other international partnerships and industry stakeholders.

Developing a diverse and highly skilled life sciences workforce: this will be done in partnership with Skills England as well as other new and existing programmes, such as Turing AI Pioneer Fellowships, to improve skillsets, including AI.

Manufacturing investment: in addition to the delivery of the £520 million LSIMF, the government pledges to consolidate previous investment and support the UK manufacture of patent protected and off-patent medicines, medtech and diagnostics.

High-value partnerships: previous collaborations have proven the UK’s ability to deliver rapid, impactful innovation under pressure. The plan aims to replicate this success to support the development and deployment of new medicines and technologies.

Net zero and infrastructure: the plan supports broader net-zero initiatives, such as the Sustainable Medicines Manufacturing Innovation Programme, as well as commitments to continue the implementation of the NHS net-zero roadmap.

Driving health innovation and NHS reform

The plan seeks to reposition the NHS not just as a healthcare provider but as an innovation partner, while recognising the NHS' operational and economic realities. The government proposes to achieve this through streamlining regulation to enable innovation to reach the NHS and patients quickly and cost-effectively. Key proposals include:

Accelerating regulatory approval: the government proposes further investment for the MHRA to enable it to deliver projects in accordance with statutory timelines, ensure that its digital platforms support industry applications and enquiries from 2026 onwards, and support the use of AI to accelerate the pace of regulation.

Medical device regulatory reform: proposals for a reformed medical device regulatory framework aim to create an innovation friendly domestic route to achieving UK Conformity Assessment certification.

A new framework for AI in 2026: the MHRA will review regulations and publish a new regulatory framework for AI with a view to being the fastest, safest and quickest place to regulate AI and software. The MHRA will also work with the Regulatory Innovation Office to look at how best to support the use of AI in drug discovery.

Accelerating route to market: the government proposes using international reliance and recognition routes for medicines and medical devices to accelerate routes to market. The Department of Health and Social Care will introduce a pre-market statutory instrument, including the International Reliance Framework, to Parliament by Autumn 2026. Enhanced coordination between MHRA and NICE also aims to streamline market entry.

Streamline access to new medicines and adoption of medtech: this will be achieved by reducing duplication and introducing low friction procurement and contracting mechanisms, such as the introduction of an innovator passport in the NHS for medtech by 2026 and expansion of NICE's technology appraisal process from April 2026.

Supporting generic and biosimilar medicines: the plan places a strong emphasis on supporting generic and biosimilar medicines, including through the reduction of regulatory burdens and opportunities offered by the Procurement Act 2023 to give earlier sight of NHS tenders for suppliers. Although the government pledges to maintain the UK's renowned intellectual property (IP) standards, there will be a greater focus on achieving cost savings in the NHS by the quick uptake of generics and biosimilars.

Osborne Clarke comment

The life sciences sector plan arrives at a critical juncture, offering an opportunity to reset the relationship between the government and the pharmaceutical industry amid ongoing dialogue around drug pricing. With a renewed commitment to streamlining regulatory frameworks, more targeted investment and focus on strategic, high-value partnerships, the plan, on the face of it provides an ambitious blueprint for a globally competitive, innovation-driven life sciences economy that aims to improve patient outcomes.

Nevertheless, the plan has received a more guarded reception from industry which has voiced concern over the government's ongoing focus on driving cost reductions, cautioning that it risks compromising growth and innovation to the detriment of UK patients. The government's proposals around early-stage funding, investment and regulatory flexibility may offset that risk, even if pricing remains tight. The recent appointment of industry leader Steve Bates OBE as the new executive chair for the Office for Life Science – the cross-government unit that promotes research, innovation and technology in the sector – also signals the government's intention to act quickly in delivering the plan's objectives.

Looking ahead, life science companies will need to monitor and prepare for an evolving regulatory and policy landscape and consider how this might shape their strategic priorities in the UK.

From a regulatory perspective, companies should assess the potential impact of proposals to simplify and streamline the current regulatory framework for medicines and medical technologies and how this might affect product development timelines. Similarly, with the government seeking to focus on increasing commercial trial participation, reducing red tape and standardising contracts to decrease the set-up time for commercial clinical trials, companies may wish to consider reviewing current clinical trial agreements and monitor any changes to contractual clauses. Consideration may also need to be given to supply chain logistics.

The proposed establishment of a new working group to address regulatory and non-regulatory barriers to lending to IP-rich SMEs may encourage IP-backed lending, helping IP-rich SMEs to scale up. The government will be publishing an update on its work in this area and next steps by the end of the year.

It remains to be seen how the government's plan to cut NHS costs by the quick uptake of generics and biosimilars will sit alongside the government's ambition of maintaining the UK's robust IP standards. Will we see a change in patent enforcement strategies?

More broadly, life sciences companies should prepare to work more closely with the government and NHS. Data access and real-world evidence should present both research and commercial opportunities.