The Growth of Life Sciences in East Anglia

Paul Sullivan, UK Network Senior Manager for East Of England, British Business Bank

The sector is also particularly important to the East of England, with a significant cluster of activity around Cambridge.

Boosting the region’s success is its business-friendly environment, proximity to universities and access to finance. It also enjoys access to a deep pool of talent working in a sector that is keen to invest in new people, develop new products and enter new markets.

A key factor in supporting the growth of the sector in the region is ensuring businesses have access to the right kind of finance, at the right time, to meet their growth ambitions. This lies at the heart of the British Business Bank’s objective to make finance markets work better for smaller businesses in the UK – and the Bank is currently supporting over £1.1bn of finance to more than 5,600 smaller businesses in the East of England.

The UK provides a fertile ground for innovation to thrive, but life sciences businesses are capital-intensive and have a particular need for long-term patient capital investment to help them scale up successfully. In 2018, the Bank set up a new £2.5bn subsidiary, British Patient Capital (BPC), designed to enable such long-term investment in high-growth potential companies in the UK, and it made one of its first investments (of £9m) into the Dementia Discovery Fund, a specialist venture fund creating new medicines for dementia.

The Bank’s Small Business Equity Tracker report, released in June, also reported that life sciences was the second largest technology subsector in terms of both equity deal numbers and investment values in 2018, with 86 deals worth £746m. Investment in life sciences was up 22% relative to 2017, although the number of deals remained the same.

Overall our research showed that the East Anglia region saw a substantial increase of equity investment in 2018: investment in smaller businesses in the East of England increased 118% from last year and this forms part of the bigger picture that saw the value of equity finance investment outside of London increase by 29% (£616m), to stand at £2.8bn. Cambridge’s cluster for Digital Health – the fifth largest in the country – contributed significantly to the East of England’s recent success in this area.

British Business Bank-supported funds provide some good examples of where the right sort of funding at the right time has helped life sciences businesses in East Anglia grow rapidly using equity funding.

Based at Rothamsted Research Centre in Harpenden, FungiAlert provides soil and water health screening, facilitated by its patented technology, SporSenZ – the first, in-the-field sensor which samples microorganisms in soil and water. Analysis of these samples alerts growers to the risk of infection before visible symptoms appear, leading to improved disease management strategies and decisions, increased yields, and improved soil-health.

Founders Kerry Weaver and Angela de Manzanos raised £420,000 in a funding round led by Bank delivery partner Sussex Place Ventures – including £370,000 through the Bank’s Enterprise Capital Fund programme. This allowed the business to hire three new team members, purchase key equipment and undertake extensive field trials.

After launching its first product in January 2019, the business needed additional finance and raised a further £350k in April 2019 to build an experienced sales team, support on-going product development research and to expand internationally.

Including field trials, to date, FungiAlert has deployed more than 700 SporSenZ sensors.

Also based in East Anglia is Exonate, a biotechnology company that develops drugs for the treatment of diseases of the back of the eye – specifically an eye drop for the treatment of retinal vascular disease, including Wet Age-Related Macular Degeneration (WAMD) and diabetic macular oedema.

Exonate needed capital to help with research, optimise compounds, and proceed with a pre-clinical safety and toxicity development programme before entering clinical trials in 2020. The company was able to raise £2.8m of equity angel funding, supported by funding from the Universities of Nottingham and Bristol and the British Business Bank-supported Angel CoFund.

They are now firm advocates for angel investment, citing the fact that they were able to receive funds from individuals and organisations with real expertise in biotechnology as well as their backers being able to introduce them to potential partners and other future investors.

To further understand the benefits of this sort of finance, businesses seeking angel, equity or other investment can access the British Business Bank’s Finance Hub – an interactive website dedicated to providing independent and impartial information on finance options for scale-up, high growth and potential high growth businesses, to build awareness of and confidence in finance options for smaller businesses.

The Hub includes a simple six-step ‘Finance Finder’ that helps smaller businesses explore the options that could work best for them. The new site also features case studies and learnings from real businesses to guide businesses through the process of applying for growth finance.

The Finance Hub, targeted at scaleups, sits alongside the Business Finance Guide, which covers smaller business finance options more widely. Businesses can learn about the many choices available at
or follow the Guide on Facebook

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