Britain’s plans for expanding its position as a global centre for biopharmaceutical research and development hit a barrier on 10 September when Merck & Co Inc announced a decision to stop development of a £1 billion research centre in London, and vacate two other laboratories in the city. The sudden reversal of the research centre project was described by Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry (ABPI), as an “incredible blow.” He told the BBC that the decision was a wake-up call to government, saying it was being driven by the UK’s lack of competitiveness compared with other geographies.
Merck, known in Europe as Merck Sharp and Dohme (MSD), said the decision followed an evaluation of the company’s global discovery business. It concluded that successive UK governments had undervalued innovative medicines and vaccines, according to the publication Science News. A key issue is the UK policy on drug pricing.
Merck’s £1 billion investment was being directed at a new research site under construction in north London near the Francis Crick Institute, an institution partnered with leading UK medical organisations. The 25,000 square foot facility was intended to accommodate about 800 MSD employees, including approximately 180 discovery scientists and business development and regulatory affairs professionals. The site was scheduled for completion in 2027. Also on 10 September, Merck said it would be vacating laboratory space at the Crick Institute where it was leasing accommodation for about 50 researchers. In addition, it will quit the London Bioscience Innovation Centre, another facility. Staff currently located in the two laboratories are expected to vacate the premises by the end of the year.
Separately on 12 September, AstraZeneca Plc told the BBC that it had paused a £200 million investment in its Cambridge, UK, research site. “We constantly reassess the investment needs of our company and can confirm our expansion in Cambridge is paused,” a spokesperson said.
The two announcements come less than a month after negotiations between the ABPI and the government over drug prices ended without an agreement. The UK operates a policy under which new drugs being sold to the National Health Service are reimbursed up to a level agreed with industry. Under the scheme, industry is required to pay back the government if spending exceeds the agreed ceiling. This year the repayment rates for the industry have soared, triggering a review of the scheme by both parties. The discussions aimed at reaching an agreement adjourned without a plan.
In a statement, the ABPI said that the UK’s decades of disinvestment in medicines and vaccines have left the NHS lagging international peers in terms of access to and use of innovative treatments. Unless something changes, these trends will continue, it added.
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