By Chris Swarbrick, Senior Director of Debt Finance at OakNorth Bank
As we close 2021, the UK government approaches 2022 with aspirations to become a powerhouse for new treatments and technologies in biomedicine. OakNorth Bank is honoured to support this growth with new development opportunities for the Life Sciences sector.
On 2nd December, England’s Prime Minister Boris Johnson hosted a virtual summit with some of the world’s largest pharmaceutical companies to discuss the UK’s future investment in the Life Sciences sector.
The timing was no coincidence. As the new COVID-19 variant Omicron spreads rapidly across the country, the NHS is gearing up for its next huge vaccination campaign, including the roll-out of booster jabs.
The pressure that the new strain will pile onto the NHS has not been officially quantified, but health experts have expressed concerns around staffing, funding, resources and vaccination supplies.
As we edge closer to Christmas, the urgency for action is great; any decisions made now will mark our progression to halt transmission in 2022.
The summit was therefore focussed on two things – action and investment. Both of which will help the UK manage the COVID-19 and prepare for the post-pandemic future.
While the current situation is tough, the vision laid out by experts is one of hope and advancement. The UK will be a ‘global centre for innovation’ in Life Sciences, not only to pioneer research and development in COVID-19, but other terminal healthcare challenges, such as cancer, dementia, and respiratory diseases.
Putting the country’s health, wealth and resilience front and centre
In the virtual conference, medical leaders committed to focus on the UK’s domestic efforts to tackle new emerging variants and prepare for future pandemics.
This focus goes hand-in-hand with the £500m investment in the UK life sciences, which will create at least 420 new high-skilled jobs and encourage innovation alongside advanced research.
And while there was a clear eye on the future, there was high praise for what’s been accomplished so far. From the new discovery of dexamethasone to the vaccination production and strategic roll-out, the biomedical sector has proven its critical nature and strategic importance to the country’s health, wealth, and resilience.
But unfortunately, the up-hill challenge to prevent future global pandemics and cure terminal illnesses remains. This motivates the UK to work harder to create dynamic health solutions that support public health and champion economic prosperity.
While public investment ramps up, the Life Sciences sector in the UK has already experienced record levels of private investment. Over £1.5bn was raised between March and May 2021, and over £1 million of that figure was venture capital by UK biotech and Life Science companies.
2020-21 has taught us that pioneers need pace
One of the most incredible and commendable characteristics of the sector is its ability to innovate, pivot and push boundaries at breakneck speed. With the current necessity to ‘stop the spread’, research and development has grown exponentially in extraordinary circumstances.
But to continue at this pace, the Life Sciences industry will require further investment. The vision to use new technologies and the findings of the pandemic to pioneer in treatments for other chronic and terminal illnesses means the sector is only just beginning to scratch the surface of what’s possible with the right technology and infrastructure.
The requirements for new spaces – specifically, labs – are highly specialised and often need to be built from the ground up or redeveloped accordingly.
Without expert knowledge in the sector, most lenders are unequipped to support the completion of these new sites. Alternatively, new labs and facilities could be stalled or mishandled with lending processes that fail to understand the complexity or specialist needs of projects at this scale.
New space to innovate
In May 2021, Chris Swarbrick our Senior Director of Debt Finance, worked closely with Bruntwood SciTech, a joint venture between Legal and General and Manchester based landlord, Bruntwood.
Chris’ long-standing expertise, along with our unique approach to financing meant we were able to act quickly to fund the development of two new office and lab locations in the West Midlands.
OakNorth Bank takes a forward-looking approach and analyses data at the granular, loan level which means we’re able to understand the nuances and specifications of what is needed, and at what cost.
Instead of treating my partnership with Bruntwood SciTech as a traditional real estate deal, I dedicated my time to truly understand the biomedical sector. It allowed me to dive into the details and understand the unique use cases for new properties, which meant I could ask the right questions. For example, ‘are wet labs more expensive to fit out?’ And ‘is the location critical for attracting the right talent and skillset?’
It’s clear then, the UK is serious about spearheading research and development for global biomedicine. The government funding and private investment will not only create thousands more jobs, but with the right strategic growth it will accelerate important discoveries that will benefit global public health.
The Life Sciences sector continues to inspire us with its innovation, determination, and resilience. We’re honoured to have played a part in the creation of new facilities that can help more ground-breaking research take place. As the government collaborates with great minds, we look forward to supporting new research centres for an incredibly invaluable sector in 2022 and beyond.