British firms are brilliant at biotech.
We must not squander our lead
Biotechnology is one of the most revolutionary yet underappreciated technologies of our time. This year alone it promises personalised cancer vaccines, cures for rare childhood diseases and the ability to design and print new DNA to kill bacteria. It is expected to contribute upwards of $2 trillion to the world economy by the end of the decade, transforming everything from medicine to manufacturing.
But Britain, despite our historic strength in this area, risks missing out.
The sector consistently produces pioneering innovation, yet equity financing for British biotech was down 49 per cent in 2025 and venture capital funding fell 13 per cent. Restrictive regulations mean many British biotech products can be sold in other countries but not here, where they were invented.
It would be a tragedy if Britain — the country where the structure of DNA was discovered, where a mammal was first cloned, and which birthed the Nobel Prize-winning AlphaFold — were to miss out on this moment. It holds the promise of not only medical advances but also the ability to biologically grow rocket fuel, magnets, fibre-optic cables and many other industrial inputs. But if we do not act, we will miss out. China is already hustling to take over biotech — as it has so many other industries.
My Stanford colleague Professor Drew Endy warns that biotech is the sector most likely to produce a “Sputnik moment”, a Western realisation of how far ahead China is in a defining tech. Last year, the US National Security Commission on Emerging Biotechnology warned that Beijing was three years away from achieving biotechnology dominance. Already, many Western pharmaceutical companies are dependent on WuXi AppTec, the socalled Huawei of biotech, and other Chinese firms such as BGI Group.
This matters because China weaponises dependencies. Biotech also has a slew of uses beyond medicines. It can be used to transform, and indeed grow, manufacturing, computing and military materials. If Beijing achieves dominance, it is much more likely the 21st century will be the Chinese century.
Beijing has been investing heavily in biotech for decades. It began with crops, as it strove for food security, but has now extended to other fields. Almost half of all new drugs entering human trials last year were from China, as were well over half of the active pharmaceutical ingredients (APIs) in antibiotics. But the real chokepoint lies upstream, where Beijing controls the production of key starting materials that go into APIs for drugs like amoxicillin and penicillin.
Beijing is now funding foundational research in a way that we in the West are failing to. As China is radically raising its expenditure, the US is cutting back. I increased UK R&D spending to record levels, and Labour has boosted it again.
But we will never be able to compete in pure funding terms with the US and China. So we have to box clever.
We are getting some things right.
More than half of all European advanced therapy clinical trials take place in the UK. The MHRA, our medicines regulator, is taking a sensible approach to genetic medicines for rare diseases. Rather than requiring each drug to be approved, it instead plans to greenlight techniques: once approved, any drug made using the method will be cleared automatically, saving time and cutting costs.
But on other things we are moving far too slowly. AI-driven drug discovery holds huge promise. At the moment, developing a new drug is a laborious process: 90 per cent of efforts fail at the first hurdle. But AI is changing that, moving it from being a lab-based process to a computer-driven one — from in vitro to in silico, as the industry jargon has it.
This has already accelerated and doubled the success rate of medicine development. Sir Demis Hassabis’s London start-up Isomorphic Labs is one of the leading companies in this field, with almost $3 billion in pharmaceutical partnerships. It promises to be one of the most significant UK start-ups since chip-design company Arm.
But there is an opportunity to create more British winners — and cure more diseases. We have world-leading biobank and genomic sequencing data libraries, and the health data held by the NHS is more comprehensive than any other set in the world. If UK firms were given preferential access to this NHS data, we would provide a compelling reason for companies to be based here.
Our rules and regulations are also holding us back. British scientists have developed a new purple tomato that contains antioxidants helping reduce the risk of cancer. You can buy it in America, Australia and Canada, but not here; it hasn’t yet been approved. Companies won’t stay long in a country where their reward for innovation is to be told their new products cannot be sold.
If growth is truly our national priority, we must resolve this problem. If the Genetic Technology Act we passed in 2023 does not go far enough, then update it. We must also avoid aligning with EU biotech regulations — a precautionary approach fundamentally ill-suited to an era of rapid innovation. If we sign up to these rules to try and facilitate agricultural trade, we will make ourselves internationally uncompetitive.
Biotechnology draws on two of our great national strengths: life sciences and artificial intelligence. If we were to miss out on this multi-trillion-pound revolution because of our failure to use our national data, reform restrictive regulations and fix a flawed financing model, it would show us to be fundamentally unprepared to take advantage of the opportunities of the coming decades.
Biotechnology would be a good place to start demonstrating that Britain really is serious about growth.
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