The U.K. is open for biotech business, and Merck is buying in

The U.K. is striving to brand itself as a hotbed for biotech R&D, promising new funds for startups, pledging to speed up its approval process and courting some major players to deepen their roots in the country.

Following through on Prime Minister David Cameron's 2011 pledge to make the U.K. a global life sciences hub, local leaders have set out a welcome mat for industry, securing a major commitment from Merck ($MRK) in the process. The U.S. pharma giant has pledged to invest at least £42 million ($66 million) in the country over the next three years as it blueprints a London dealmaking outpost. Merck also intends to expand its R&D operations in Hertfordshire, focusing on oncology and dementia research, the company said.

The unveiling of Merck's investment is part of a coordinated attention grab on the part of the British government, which is also touting an expansion of its Biomedical Catalyst program, through which Innovate UK and the Medical Research Council bankroll startups and academic-led R&D projects with commercial potential. The two organizations have earmarked another £31 million ($49 million) for the program, piling onto the £200 million ($314 million) they've already awarded to more than 250 companies.

And, beyond supporting the development of new treatments, the U.K. says it wants to help get them to patients faster. In response to long-levied criticisms of how long it takes for new drugs to reach British shores, the government is plotting an Innovative Medicines Review, which will examine how regulators can work with industry to more quickly get the most promising treatments into use within the country's National Health Service.

The news was well-received by U.K. industry groups, which have for years lobbied the government to help inculcate a life sciences hub like the one in Boston, where world-class research institutions abut promising biotech startups and Big Pharma recon squads.

Stephen Whitehead

Stephen Whitehead, CEO of the Association of the British Pharmaceutical Industry, praised the effort as a welcome response to "increasing evidence of the need for a holistic approach to U.K. life sciences," at the same time challenging the government to loosen up its strict cost-effectiveness rules for new drugs. Steve Bates, chief of the nation's BioIndustry Association, heralded the government's work as "crucial to the success of the U.K. life science ecosystem" and key to his organization's ambitions of creating a booming biotech home base.

That promise was particularly alluring to Merck, company Global Human Health President Adam Schechter said, and the drugmaker sees a bright future for itself in the U.K.'s interconnected research community.

"We are impressed with the United Kingdom's approach to its Life Sciences strategy which takes an 'end to end' view of medicines, from discovery through their use in the real world," Schechter said in a statement. "Our commitment extends beyond the realms of academic and clinical research, and strives to find innovative ways to use data and technology to transform healthcare and in turn, patients' lives."

The nation's biopharma R&D scene is on the mend after years of cutbacks and site closures from the likes of Pfizer ($PFE), AstraZeneca ($AZN) and Shire ($SHPG). Many of the U.K.'s largest drug developers have gradually abandoned far-flung corporate campuses in favor of more urban outposts within the triangle of London, Cambridge and Oxford, a trend leaders public and private hope will help foster a return to growth.

- read the government's release
- here's ABPI's statement
- and BIA's take

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