Introduction
Life sciences as a sector is worth £108 billion to the UK economy and has been in the national spotlight ever since the COVID-19 pandemic, with government and global investors increasingly recognising its importance and allocating funds accordingly.
The sector’s ability to deliver economic or financial returns, as well as the wider societal health benefits, make investment in the UK’s life sciences a compelling policy or business strategy.
Translating intentions or plans into substantive action is imperative though. While the UK has immense potential, with clusters of academic and industry excellence across the country, challenges remain, such as a shortage of laboratory space and declining manufacturing exports.
In a competitive global market, the construction industry has a crucial role in manufacturing a new horizon — tackling challenges related to delivering world-class Research & Development (R&D) space, leveraging digital tools and realising clients’ ESG plans.
What’s hot, what’s not?
Horizon Europe: UK returns to EU research programme.
Levelling up: Delays with progress. Funds not yet spent in some locations and schemes not delivered.
Biosciences Building
NOTTINGHAM, UK
Pharma / Biocity
Building Surveying / Quantity Surveying
Bruntwood SciTech
CAMBRIDGE, UK
Melbourn Science Park
Quantity Surveying / Cost Management
Ones to watch
Click on the icons to reveal key life sciences developments
Ones to watch
Glasgow
The Medicines Manufacturing Innovation Centre opened in 2022 and is the first facility to open at Netherton, the 52-hectare council-owned site next to Glasgow Airport at the heart of the manufacturing innovation district, which also spans Westway and Inchinnan Business Parks.
Edinburgh
Edinburgh BioQuarter has plans over the next decade to transition into Edinburgh’s Health Innovation District — a new mixed use, urban neighbourhood of Edinburgh centred around a world-leading community of health innovators and companies. This co-location of industry and academia combines the University of Edinburgh’s College of Medicine and Veterinary Medicine and other parts of the University with core research facilities, shared equipment and expertise.
North West
Medicines Discovery Catapult (MDC) at Alderley Park science and innovation centre continues to thrive, building the AP Lighthouse Laboratory in March 2020 to establish the national Lighthouse Laboratory network by the NHS and the Department of Health and Social Care. Meanwhile, AstraZeneca is to fund the building of a vaccine manufacturing hub in Speke in Liverpool.
Newcastle
Biosphere is a £1.5 billion life science ecosystem on Newcastle Helix. This vibrant 24-acre district brings together a community of industry leaders, businesses, and top researchers in an internationally renowned innovation community.
Bristol
Home to the largest cluster of synthetic biology companies outside the Golden Triangle, alongside a fast-growing start-up scene in other biotech and biomedical areas.
Birmingham
Birmingham Health Innovation Campus has been a long-term aspiration of the city and the University of Birmingham. Set to open this year, it aims to create an infrastructure to support the commercialisation of the pioneering R&D work delivered within an existing cluster of health excellence.
Cambridge
Cambridge Science Park is home to more than 20,000 researchers, scientists, academics and clinicians. Cambridge Biomedical Campus is the largest in Europe. The Cambridge cluster of over 18 established parks is underpinned by the presence of world-leading R&D taking place at the University of Cambridge and the specialist research institutes, hospitals and businesses established in the city.
Oxford
Oxford Science Park is associated with one of the highest-quality scientific research institutions in the world — the University of Oxford. Elsewhere, Harwell Campus has one of Europe’s largest clusters of growth companies and the UK’s first dedicated Vaccines Manufacturing Innovation Centre.
London
London benefits from a vast pool of academia and industry professionals based in clusters across the capital. Sites include the Cell and Gene Therapy Catapult, SC1, the Knowledge Quarter and White City. Meanwhile, the Docklands area goes from strength to strength, with Kadans Science Partner recently securing planning consent for a 23-storey vertical campus at Canary Wharf, which will be Europe’s largest life sciences building.
Hertfordshire
Stevenage is home to GlaxoSmithKline's global research and development facility and the Stevenage Bioscience Catalyst campus. Future pipelines include the Elevate Quarter, where construction is due to begin on 1.6 million sq ft of lab, office and manufacturing space.
Cardiff
Cardiff Edge is an 11-hectare site which provides R&D space across serviced labs and offices in Cardiff. Having recently undergone a £1.5 million refurbishment, Cardiff Edge reflects South Wales’ ambition to create an exemplary life sciences ecosystem, connecting business, academia, and the public sector at a single location.
Belfast
Ulster University and Queen’s University Belfast, Northern Ireland’s two major universities, provide globally competitive research expertise, including 17 life sciences-related research centres and a proven track record in commercialising healthcare technologies. Ulster University’s Connected Health Innovation Centre (CHIC) is a leader in connected health research, focusing on managing long-term chronic conditions.
Institute of Development and Regenerative Medicine
OXFORD, UK
HigherEd / University of Oxford
Quantity Surveying / Cost Management
© RIDGE
Portway Laboratory
CAMBRIDGE, UK
R&D / BioMed Realty
Project Management /
Quantity Surveying / Cost Management
© NORR
Leasing and development
Tenant demand is high, but an acute supply and demand imbalance exists. Decisions around real estate requirements can be left to the last minute at start-ups as they wait for their next funding round before searching and committing to space.
In London, 860,000 sq ft of lab-enabled accommodation is in the pipeline, according to Cushman & Wakefield, which is unlikely to satisfy current levels of pent-up demand. Furthermore, investors are holding back speculative development amid the current macroeconomic climate, and for developers, some projects are proving unviable given London’s already high land costs.
The other ‘golden triangle’ locations – Cambridge and Oxford – are earmarked for 549,000 sq ft and 911,000 sq ft respectively of deliverable real estate.
A further 5.7 million sq ft of space within the Golden Triangle has planning permission, which could help alleviate supply constraints.
Government policy and vision
Life Sciences Vision 2021: is the vision being delivered?
The sector has seen various funding commitments from a government keen to see the UK become a global superpower in life sciences while also stimulating economic growth.
Funding was announced in September 2023 to establish a Medicines Manufacturing Skills Centre of Excellence. This £5.3 million grant funding forms part of the £650 million 'Life Sci for Growth' war chest to fire up the sector, as launched by the chancellor in May 2023. A competition to allocate funding, led by Innovate UK, opened and closed towards the end of 2023.
This funding was followed by the government committing £520 million to life sciences in the Autumn Statement. Commencing from 2025 until 2030, the grants will support capital investments into manufacturing facilities. Additionally, £250 million is allocated in new fellowships for world-class mid-career researchers.
Enabling further domestic production of new medicines and treatments is crucial if the vision is to be delivered. However, manufacturers’ needs go beyond funding — requiring skilled labour to discover, develop and manufacture medicines along with wider infrastructure if production capacity is to increase.
Government support for life science studies involves providing £51 million for the UK’s largest-ever research study — Our Future Health — a leading resource for health research. The funding will help the study recruit volunteers to genotype the first one million participants, supporting the development of better ways to prevent, detect and treat diseases.
What is the Life Sciences Vision 2021?
A ten-year strategy with the ambition to create a globally competitive environment for life science manufacturing investments, building on the strengths of the UK’s manufacturing R&D, the network of innovation centres, the manufacturing response to COVID-19 and delivery of the Medicines and Diagnostics Manufacturing Transformation Fund.
Research and development (R&D)
At Gleeds, we see the sector evolving over the next few years so that manufacturing facilities and R&D space are increasingly delivered together and integrated into life science clusters.
For modern life science estate buildings to thrive, they must be genuine ecosystems, not just occupiers simply operating within their own space.
Higher education (HE) campuses are an excellent example of this, where the demand for research space is plugged on campus in a collaborative manner.
Patients are now more willing to actively participate in the design of their care. An approach that veers towards prevention and wellness and away from disease management.
Funding for R&D work is being drawn globally from REITs, Sovereign Wealth Funds and institutional investors.
An example of real estate investors becoming early-stage enablers of R&D work is ‘Motherlabs’ in London, launched by Brookfield, offering serviced labs and shared autoclaves. Start-up tenants often need to share equipment, with early funding allocated to research rather than real estate needs. Delivering these shared spaces, therefore, helps them grow sustainably and move innovations or ideas from concept to commercialisation.
Manufacturing
Table 1: Medicine exports and trade balance for UK and comparator countries exports
Source: Life Sciences Competitor Indicators, 2022 (gov.uk) (accompanying data tables 19 and 21).
An emerging trend in the manufacture of medicines is the rise of localised production that still follows international best practices.
In May 2021, the World Health Organisation adopted resolution WHA74.6 on ‘Strengthening local production of medicines and other health technologies to improve access’, signalling the important role of local production and technology transfer as a strategy to improve timely, equitable access during peacetime and pandemics.
November 2023 saw the second edition of the ‘World Local Production Forum: Enhancing access to medicines and other health technologies’ (WLPF) held in the Netherlands aimed at boosting global coordination and synergies among United Nations member states and the international community, galvanising collective action and shaping the strategy and direction globally of local production and technology transfer.
In the UK, we are starting to see less reliance on generic volume drug production and a trend of ‘microbrewery’ type facilities, with discreet medicines produced at a smaller scale, resulting in fewer logistical issues than importing from abroad and a more sustainable approach.
Whether this can help turn the tide on the UK’s export competitiveness remains to be seen, but innovative routes to production should bolster attracting medicines manufacturing into the UK.
The UK’s exports, although still substantial, steadily declined in the five years leading up to 2020, while other comparator countries increased their export volumes (Table 1).
Matching the ambitions of competitor countries will be essential if the UK is to be a leading manufacturing location. For instance, member states in the European Union are proposing a Critical Medicines Act to provide a ‘toolbox of different instruments’ in reducing reliance on third countries for the supply of medicines.
At the other end of the spectrum, logistical steps such as the continuation of co-locating manufacturing with research centres of excellence should yield further success. Recent examples include Grand Challenge 3, demonstrating the UK’s ability to produce next-generation oligonucleotide-based (short, single or double-stranded DNA or RNA molecules) medicines at scale.
Pharmaceuticals and biotechnology
When it comes to the potential for start-ups to make an impact in pharmaceutical and biotech production, the sky is the limit. Almost literally. BioOrbit is currently considering the possibility of manufacturing cancer drugs in space after joining the European Space Agency Business Incubation Centre United Kingdom (ESA BIC UK).
The start-up intends to develop the necessary hardware for large-scale crystallisation in space – which enables a superior crystallisation process — for protein antibody drugs.
If successful, the societal benefits would allow patients to access treatment conveniently at home, administered similarly to insulin, which is composed of tiny crystals. If the target of a manufacturing facility in space within the next decade can be achieved, then this would save patients' time and avoid the current intravenous cancer treatment methods.
Collaboration
The collaborative spirit at the core of life sciences is crucial to its success. The best recent example was the development of the University of Oxford–AstraZeneca coronavirus (COVID-19) vaccine. The technology was ready to be deployed at Oxford, and AstraZeneca was the partner who provided the finances and contacts to transform an academic project into a global vaccine programme.
While this was primarily academia and ‘big pharma’ coming together, the government and the Medicines and Healthcare Regulatory Authority (MHRA) were also key stakeholders, demonstrating the importance of public sector support in enabling future breakthroughs.
Pharmaceutical companies are also key investors, with the Spring Budget announcement that AstraZeneca will invest £450 million at its manufacturing site in Speke, Liverpool, for the research, development, and manufacture of vaccines.
Agreeing on a partnership with a government can be particularly beneficial for biotech companies looking to test and produce products at scale — often over a longer timeframe, offering security for wider supply chains. Furthermore, this offers unrivalled access to a country’s clinical trial network, genomics and health data assets.
An example of this is BioNTech recently agreeing on a multi-year deal with the UK Government to provide personalised cancer therapies for up to 10,000 patients by the end of 2030, either in clinical trials or as authorised treatments.
Regulation
The state of the regulatory environment in the UK is an important factor when it comes to companies investing or deciding where to base themselves. For instance, drug pricing policy has resulted in some pharmaceutical companies voicing doubts about continuing to operate in the UK.
However, in November 2023, the NHS agreed a long-awaited deal with global drugmakers to raise the growth cap on the UK’s annual drugs bill, opening the door to further new and innovative medicines, albeit still restricting pharmaceutical companies’ ability to sell to the NHS.
The Voluntary Scheme for Pricing, Access and Growth (VPAG) agreement will raise the growth limit on the health service’s yearly costs for branded drugs from its current 2% to 4% in 2027.
This agreement, however, sets a yearly cap on the total allowed sales value of branded medicines to the NHS each year. Sales above the cap are paid back to the government via a levy. Industry paid back the NHS £2 billion in rebates for the 2022/23 year.
Hot topics
Artificial Intelligence (AI)/digital
AI technology and machine learning are still in the early adoption phase in the sector. However, there is little doubt about the prominent role AI can and will have in the speedier discovery and development of drugs using algorithms. By the end of the decade, all new drugs could be created by AI.
Exscientia is a prime example of AI's potential in drug creation and how to target suitable patients. The spinout created the first AI-designed molecule with Sumitomo Pharma to treat obsessive-compulsive disorder. It took just 12 months to discover and represents the first ever AI-designed drug candidate to enter clinical trials.
Although there is a high level of innovation in the industry, biopharma companies face a complex and challenging environment due to increased competition and R&D cycle times, shorter time in market, expiring patents, declining peak sales, pressure around reimbursement and mounting regulatory scrutiny.
Embracing digital transformation will enable biopharma companies to innovate new products and services, engage customers more effectively and execute processes more efficiently.
The AI Life Sciences Accelerator Mission
New funding from the government will capitalise on the UK’s unique strengths in secure health data and cutting-edge AI.
Healthcare leaders are embracing digital innovations through AI. Healthcare, by its nature, is a data-rich industry. It can take genomic information and imaging information and potentially find linkages that humans are not able to make. Similarly, by creating a digital twin of ourselves, as in buildings, biological and physical attributes can feed into AI models.
The scope and opportunity of AI in healthcare, therefore, is significant. However, it is a highly regulated and complex environment, so success is by no means guaranteed.
Case study: The Melloddy Project
The abundance of healthcare data alone is insufficient to enable AI solutions in life sciences. Collaboration between entities and quality data exchange standards via, for instance, APIs (Application Programming Interface) is essential.
A good illustration of this was the landmark Melloddy Project, which concluded in 2022 with 10 pharmaceutical companies sharing data to accelerate drug discovery. Any sensitive commercial secrets, often a barrier to sharing data, were safeguarded using Blockchain.
Along with seven technology and academic strategic partners working together, they successfully demonstrated that collaborating on AI for drug discovery is possible at an industrial scale. The results indicate that collaborative modelling among pharmaceutical partners holds potential benefits for discovering new drugs.
Sustainability
Laboratories are some of the most energy-intensive premises when in operation. On a square metre basis, the energy consumption can be more than three times that of commercial offices.
Higher ventilation requirements via HVAC units and extensive power and drainage infrastructure needed to enable laboratory work all lead to increased electric and water usage.
Therefore, the need for laboratories to be as energy efficient as possible is paramount to reducing costs and carbon footprints.
Practical steps across academia and industry that can help to minimise carbon at floor level exist, such as UCL’s LEAF initiative.
Waste is one area where best practices can, for instance, combat the prevalent use of materials that lack widespread recyclability. The United Nations recognises My Green Lab certification as the benchmark for responsible resource management and wider sustainable practices in labs.
Crucially, achieving certification is gaining traction with the likes of Novartis, whereby 800 researchers across 24 laboratory sites in 11 countries recently took part in the certification process.
Suppliers such as Abcam have recognised the impact of the 8,280 kilos of PVC plastic waste generated from the safe shipment of their vials. In response, Swiftpak created an innovative paper packaging solution prioritising recyclability while maintaining protective qualities. The versatile design allows for the safe transportation of vials of different sizes, streamlining packaging operations and driving efficiency.
Similar sustainability solutions across the sector’s assets and supply chains will be needed to help combat the climate emergency but also to secure the ‘green finance’ that is becoming increasingly deployed among investors.
“This is bigger than just a building, it's a whole philosophy. It's the way that we will process and deliver the science and the way that we will target our science to sustainability-driven challenges.”
PETER LICENCE, PROFESSOR OF CHEMISTRY
UNIVERSITY OF NOTTINGHAM
Benchmarking data
Illustrative construction costs (excluding site abnormals and professional fees)
Assumptions:
- Figures are weighted to the current quarter and a location index of the South East UK, but not located in central London.
- Per square metre gross internal area (GIA).
- Excluding facilitating works and external works.
- Including main contractor on costs (preliminaries, overheads and profit (OH&P) and contingency). The R&D rates assume a building of containment level 2 (CL2), with no basement and an even mix of office and laboratory space. For the shell and core rates, lower figures capture buildings within an out-of-town science park, whilst higher figures reflect city centre higher education developments. As defined in the science fit-out definition guidance, "ready" succeeds "enabled", so both extra overs are required to reach a ready scope. By comparison, ranges for warehouses/logistics sheds and commercial CAT A office space are provided. Warehouses/logistics sheds are assumed to be located on an industrial park by a motorway and contain circa 5% of CAT A office space on a mezzanine level(s). Lower ranges of commercial CAT A office space are assumed in a science park location, whereas higher ranges are for city centre locations.
Spatial and design metrics
The figures below represent a guide for typical spatial allocations and design metrics based upon various higher education and life sciences R&D new build Gleeds projects.
Average wall:floor ratio
Net internal area (NIA) split between office and lab space
Average floor heights
Average grid dimensions
Average landlord plant room percentage of GIA
0.44
Wall:floor ratios for new build developments are, on average, 0.44, which is an optimum value. Anything over 0.8 is considered inefficient.
60:40 (labs:office)
Floor-to-ceiling: 2.6m – 3.0m
Floor-to-floor: 3.75m – 4.5m
The average floor-to-floor height is 4.1m, which allows for the increased service void required for life sciences and pharmaceutical projects.
7m x 6m
5% – 15%
Landlord plant space is typically 9% of the GIA, which is a figure higher than office schemes, by comparison, average at circa 5%.
Interested in more detailed cost and design metrics?
Contact Alex Bill and the Intelligence team at Intelligence@gleeds.com for your bespoke insights.
Gleeds UK life sciences experience
Summing up
The UK's life sciences sector has great potential to succeed in a competitive global market. The depth of expertise across academia and industry — working in collaboration in clusters across the country — requires an equally deep investment in infrastructure.
Providing the right facilities in places where colocation between, for instance, manufacturing and research centres of excellence, is currently constrained should yield further breakthroughs and help export volumes rebound.
The construction industry has a vital role to play here, as and when funds are channelled from public, private, and indeed global sources, in delivering state-of-the-art, futureproofed R&D space constructed to the highest sustainability standards.
Get in touch with our life sciences team
Galvin Tarling
Director, Global Head of Life Sciences
Tony Morrice
Director, Head of Life Sciences UK and Ireland
Get in touch with our Intelligence team
James Garner
Senior Director, Global Head of Data, Insights and Analytics
Nicola Sharkey
Project Director, Head of Intelligence
Alex Bill
Executive Consultant, Cost Data Analyst, Benchmarking Lead, Intelligence
Ned Chehalfi
Research Manager, Intelligence
Sam West
Research Manager, Intelligence
Edna Benavides
Associate Director, Intelligence Lead for Europe
Simon McElroy
Intelligence Research Assistant, Europe
Jayashree Srinivasaragavan
Cost Manager, Intelligence Lead for India
Res Orgut
Associate Director, Intelligence Lead for US
Sherif Sweillam
Director, Head of Business Operations, Intelligence Lead for Egypt
Mina Rofael
Associate Cost Manager, Intelligence Specialist
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Get in touch with our Life Sciences team
Intelligence team contacts
James Garner
Senior Director, Global Head of Data and Intelligence
Nicola Sharkey
Project Director, Head of Intelligence
Alex Bill
Executive Consultant, Cost Data Analyst, Benchmarking Lead, Intelligence
Ned Chehalfi
Research Manager, Intelligence
Sam West
Research Manager, Intelligence
Edna Benavides
Associate Director, Intelligence Lead for Europe
Simon McElroy
Intelligence Research Assistant, Europe
Jayashree Srinivasaragavan
Cost Manager, Intelligence Lead for India
Res Orgut
Associate Director, Intelligence Lead for US
Sherif Sweillam
Director, Head of Business Operations, Intelligence Lead for Egypt
Mina Rofael
Associate Cost Manager, Intelligence Specialist at Gleeds
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Legal disclaimer: This report was prepared by Gleeds and is for general information only. Neither Gleeds nor any of their partners, directors, employees or other persons acting on their behalf makes any warranty, express or implied nor assumes any liability with respect to the use of the information or methods contained in this paper to any person or party. This document is subject to copyright and must not be reproduced.
The report was prepared in March 2024 and published 20 March 2024.
