Pharma firm goes west
You wouldn’t know it to listen to much of the negative debate about Britain’s prospects, but the uK’s science-based pharma and bio-technology sector is one of its crowning glories.
Located on a golden triangle of research-based universities in Cambridge, oxford and London, it is a worldbeater, outpacing anything in Europe and second only to the Boston/Cambridge area in Massachusetts. Mainstays of the sector are the drug giants Glaxosmithkline and Astrazeneca.
Sir Greg Winter of Cambridge recently carried off the 2018 Nobel prize for medicine and has several joint ventures with AZ. Indeed, Astra is working in collaboration with some 300 different bio-tech and research groups in the effort to discover new medicines.
Against this terrific background, it is hugely disappointing to see so much of the intellectual property created in Britain, at universities largely funded by taxpayers, carried off overseas through foreign takeovers.
Just at the point in history when the uK should be girding itself for a future based upon scientific prowess and a highly skilled workforce, there is a danger we could denude commercial capacity. The £3.3bn swoop by Boston Scientific for BTG is a case in point.
BTG may have been a serial under-performer on the stock market, but it is much more than the company which makes the serum to combat rattlesnake bites.
Among other things BTG makes polymer beads for treating cancer, and in the last year boosted sales growth by 10pc. The shares have seriously under-performed, as demonstrated by the 34pc jump in Tuesday trading following a bid from Boston Scientific.
The predator’s boss Michael Mahoney was quick to hail BTG’s therapies as contributing towards advancing patient care. one can understand, in these uncertain times, why long-term investors in BTG, including Invesco, Novo Holdings and Woodford Investment Management, holding 32.8pc of the stock, have been quick to take the money and run. But this is not the spirit which saw overseas marauder Pfizer off the field of battle when it came after the much bigger and more diverse prize of AZ.
BTG has a deep history in British research, tracing its origins back to the Atlee government’s National Research & Development Council in 1948. It was created in 1981 out of the merger of the former with the National Enterprise Board, and represents the best efforts of past governments to unleash the white heat of British technology.
In waving goodbye to BTG, the uK is in effect conceding patents and intellectual property to its greatest rival in the uS.
This is the fifth company in Britain’s healthcare sector to be sold to an overseas buyer in the last 18 months, including the nation’s third largest drugs company Shire, that is heading to Japan’s Takeda.
All of this may put some zip into some sagging investment fund performances.
But it is short-termism at its most damaging. Here is a great opportunity for Business Secretary Greg Clark to back his own industrial strategy and draw a line in the sand.
Growth spurt
AMoNG the global economic forecasters, the Paris-based oECD has been the most negative on the impact of Brexit on the British economy. There can be no doubt that uncertainty over the outcome of the uK-Eu negotiations is taking its toll on investment. But not enough to knock output off course.
Politicians of the Left, and some Remain supporters, speak with great glee of how the uK has fallen to the bottom of the output league table. Hang on a moment, Lord Copper. Data just released by the oECD shows that in the third quarter of the year Britain was the second-fastest growing nation among the G7 richest countries at 1.5pc – only behind the jet-fuelled Trump economy. A flash in the pan? Not necessarily. The CBI’s industrial survey shows manufacturing had a significant rebound in November. Fancy that.
Flying high
EASyJET was a big beneficiary of the ills of the rest of the airline sector in 2018 with profits soaring by 42pc to £578m.
It expects revenue to come off the boil in the first half of next year, but continues to impress with its marketing skills promising a reward programme which will pay out in hotel upgrades to loyal flyers and a more efficient brand new fleet.
No-frills with thrills.