U.K. Pharmaceutical R&D Investment Lags Global Trends: Report

Pharmaceutical R&D investment in the UK has lagged global trends since 2018, growing at 1.9% annually since 2020, compared to the global average of 6.6%. In 2023, the UK attracted 795 million pounds in foreign direct investment into life sciences, 58% less than 2017. The industry group releases the report after Merck announced it would discontinue plans for a new research center in the UK.

The Association of the British Pharmaceutical Industry (ABPI) has released a report highlighting the UK's declining performance in pharmaceutical research and development (R&D) investment. The report, issued on 10 September 2025, reveals that the UK's pharmaceutical R&D industry has underperformed against global trends, with a significant slowdown since 2020. The UK's annual growth rate in pharmaceutical R&D has fallen to 1.9%, compared to the global average of 6.6% UK ‘losing the race’ on pharma R&D investment, industry warns^[1].

In 2023, the UK's pharmaceutical R&D investment decreased by nearly £100 million. This slowdown coincides with a significant drop in foreign direct investment (FDI) in UK life sciences. In 2023, FDI in the sector fell to £795 million, a 58% decrease from 2017 levels (£1.9 billion) UK ‘losing the race’ on pharma R&D investment, industry warns^[1]. The UK's ranking on foreign investment in life sciences has consequently fallen from second to seventh place over the past six years.

The report also notes a steady decline in commercial clinical trial placements in the UK compared to other key nations. Spain has emerged as the top European destination for commercial clinical trials since 2020 UK ‘losing the race’ on pharma R&D investment, industry warns^[1].

The ABPI identifies three key areas of untapped potential in the UK's life sciences sector: health data and expertise in artificial intelligence, advanced therapy research, and pharmaceutical regulation. Realising this potential requires collaboration between industry and government to remove existing barriers and leverage the UK's strengths UK ‘losing the race’ on pharma R&D investment, industry warns^[1].

In response to the report, a spokesperson from the Department for Science, Innovation and Technology (Dsit) stated that the UK remains the most attractive place to invest in the world. The government has already invested up to £600 million in the Health Data Research Service and committed up to £520 million to the Life Sciences Innovative Manufacturing Fund, aiming to unlock billions in private investment. The Dsit is open to collaborating with the pharmaceutical industry to drive growth and innovation UK ‘losing the race’ on pharma R&D investment, industry warns^[1].

The report underscores the need for the UK to address these challenges to maintain its competitive edge in the global pharmaceutical R&D landscape.