SCOTTISH life science companies are expected to benefit from £180 million in government cash to bridge the “valley of death” funding gap and turn medical breakthroughs into new drugs and devices.
Prime Minister David Cameron unveiled plans on Wednesday to expand the coalition’s “biomedical catalyst” fund to include later-stage companies as well as start-ups, a move welcomed by the biotechnology sector.
The fund was launched as part of the coalition government’s “Strategy for Life Sciences” in December to target academics and small and medium-sized companies, with grants of up to £3m up for grabs. The cash will be awarded by the Medical Research Council and the Technology Strategy Board.
Scott Johnstone, chief executive of the Scottish Lifesciences Association trade body, said: “Attracting new sources of venture capital funding to the sector is one of our top priorities. We strongly support the emphasis on smaller companies benefiting from this fund – these businesses are the bedrock of the life sciences cluster in Scotland.
“We also welcome the fact that, while the UK government’s initial focus for the fund was on helping early-stage companies, its scope has now been widened to include late-stage businesses. We lobbied hard for that change and we are delighted to see our arguments being accepted.”
Johnstone said Scottish business angels are very good at supplying funding for young companies and that Scottish Enterprise’s co-investment fund had helped in part to plug the venture capital “gap” for later-stage businesses.
But he added “more substantial amounts” of money need to be attracted to bridge the “valley of death”, which arises from a lack of venture capitalists operating north of the Border.