The UK’s Life Sciences Innovative Manufacturing Fund (LSIMF) is a vital mechanism for strengthening domestic manufacturing. However, achieving its full potential demands urgent LSIMF Appraisal Reform. Current evaluation methods, guided by HM Treasury’s Green Book, often miss broader economic and strategic gains. This article outlines key challenges and proposes actionable solutions for healthcare and policy leaders.

Current Challenges in LSIMF Evaluations

The LSIMF has already shown impact, with £64.2 million in grants leveraging over £850 million in private investment by 2024. Despite this, the appraisal process focuses narrowly on short-term metrics like job creation. Consequently, benefits such as productivity gains and health resilience are undervalued. For instance, innovations reducing manufacturing cycles by 30% through real-time release technologies are often overlooked in assessments.

Strategic Benefits Not Captured

Several critical advantages remain outside the evaluation scope. First, agglomeration effects, as seen in Babraham Research Campus generating £538 million in GVA in 2022/23, are ignored. Next, export growth, with life sciences contributing £26.1 billion in 2023, lacks systematic consideration. Moreover, regional investments, like Almac’s project in Northern Ireland, support fairer growth but receive little weighting. These gaps hinder a true measure of value.

Global Competitiveness and Regional Balance

Globally, nations like Ireland attract life sciences with high intervention rates and tax benefits. In contrast, the UK’s LSIMF covers just 10-20% of project costs, compared to EU schemes funding up to 80%. Regionally, only 25% of UK manufacturing sites sit in the South-East, offering a chance for balanced growth. Yet, without LSIMF Appraisal Reform, the UK risks losing ground to competitors.

Proposed Solutions for Decision-Makers

To address these issues, three reforms stand out. First, develop a broader framework to score non-monetizable benefits like exports and resilience. Second, improve transparency by publishing appraisal criteria and past award data. Third, simplify processes for smaller firms and adjust funding rates to match global benchmarks. These steps can enhance investment appeal.

Conclusion and Next Steps

In summary, reforming LSIMF evaluations is essential to unlock the sector’s potential. By valuing long-term gains and ensuring fairer assessments, the UK can lead in life sciences manufacturing. Policymakers must act now to align appraisals with national goals. Let’s shape a stronger future for healthcare and economic growth through these vital changes.

Source: https://www.abpi.org.uk/publications/green-book-analysis