Simon Webster, biomedical and life sciences product manager at Markel, looks at recent developments in the life sciences sector
It’s been an excellent year so far for the life sciences industry in the UK, having raised £743m in the first half of 2014 alone – far more than the £483m it raised in 2013, according to the latest survey of the market by the BioIndustry Association (BIA).
The BIA puts this surge in capital being raised down to a number of factors, including government initiatives such as Biomedical Catalyst funding, R&D tax credits and tax incentives for entrepreneurs. The surge also places these companies well ahead of their continental competitors. Steve Bates, the chief executive of the BIA commented: “2014 has been a strong and confident year for UK life science companies. This year for the first time in many years we’ve seen IPOs return to the sector. Companies large and small, academia, research charities, new institutions and the NHS now mix together in our ecosystem to make it one of the most vibrant and dynamic in the world. It’s an exciting time as the UK develops the therapies of the future. That’s why we are seeing global investment in the UK in genetic diagnostics, new approaches to cancer treatment, therapies for stratified and rare diseases as well as cutting edge regenerative medicines and cell therapies.”
Moreover the surge offers opportunities to those brokers and insurers who cover this sector – and even beyond. It’s important to bear in mind that great deal of outsourcing has happened in the sector over the past decade, creating a supporting network of companies to the traditional Pharmaceutical and medical device industries.
The resurgence of investor interest in the sector indicates to me that the market feels there is longevity in this industry. There is huge confidence in the UK life sciences market. This investment not only benefits the individual life sciences companies but also this supporting network of connected industries like contract research organisations, contract manufacturers, regulatory affairs consultants and distributors. We should all remember that the biomedical and life sciences sector is much bigger than those talented men and women working in labs throughout the UK pushing the boundaries of science and technology.
The question then becomes how can brokers take advantage of these opportunities? Like Steve Bates, at Markel we too have seen a surge of smaller biotech companies being created by individuals coming out of large pharma, as well as those being formed from academic institutions. These companies have enormous knowledge in the science they specialise in, but can sometimes be naïve to their basic insurance needs or risk management approach. In my view this presents an opportunity for brokers to provide guidance and advice on their clients’ commercial insurance needs and, if required, with our help identify those specific areas which require a more specialist solution.
Product manager – Biomedical and life sciences
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