BIA welcomes £1 billion support package for innovative companies
Commenting on today’s announcement from the Chancellor, BIA CEO Steve Bates OBE said:
“We’re pleased that the Government will deliver a package of support for the UK’s most innovative companies that are facing short-term financial turbulence due to the COVID-19 disruption. The BIA, along with representative bodies across the science and tech community, have been calling for this after it became clear that existing government support measures would not be accessible to our sector.
“This package will enable strong and innovative UK companies to weather the COVID-19 storm. Many of our members face significant delays to their R&D projects and fundraising due to COVID-19 hitting their workforce, supply chains and clinical trials in hospitals, along with investor confidence generally, with serious consequences for the development of new treatments for patients and the long-term growth of the UK’s knowledge economy.
“The Chancellor's statement today will enable the UK’s world-leading biotech companies to emerge from the COVID-19 disruption in a strong position to continue their growth. However, as we have seen with other COVID-19 schemes, the delivery is critical and we now need Innovate UK and the British Business Bank to get this money out the door as quickly as possible and ensure it reaches all the companies that need it.”
On the £750m grants and loans package delivered by Innovate UK
“Grants are an efficient and well-understood way for the Government to support R&D within businesses and in this crisis could not only be a lifeline for those facing an uncertain financial situation, but will also ensure UK research and innovation bounces back quickly once the disruption has passed.
“We need to look at the details but it is very welcome progress.”
On the £250m convertible loans scheme delivered by the British Business Bank
“This new scheme should be extremely useful for Great British biotech companies seeking further rounds of funding at an incredibly challenging time. It is the right ambition, and vital, to have a technically simple structure to enable the British Business Bank, and existing investors, to make decisions to proceed, at speed.
“Answers to specific questions on detail will make a real difference to the operationalizability of this scheme. We would like the match third party investor to be able to provide their cash either as equity or as a loan. The word bridge has a specific technical meaning in this context and we advise that it is not used. The ability to convert loans at the next subsequent round will also speed the process of adoption fast. We look forward to ongoing discussion with the BBB to clarify these points. Companies looking to apply should ensure they have raised £250,000, have matched investors and are able to substantiate their economic footprint in the UK.
“Alongside this, we urgently need the planned £200m life sciences scale-up fund to be expedited, so that companies can start to receive that money from the British Business Bank.”
On what’s missing
“The BIA has called for R&D tax credit payments to be advanced for companies to provide additional cash in the bank to see them through this disruption. Unlike what has been announced today, all companies across the sector would benefit as all make R&D tax credit claims. This would be money that the companies would be getting anyway just brought forward by a year, so would not be an additional cost to the tax payer. Sadly the Treasury has not announced that today so we strongly urge them to bring forward that third measure.”
Notes to Editors
1. For more information please contact Jack Fellows, Communications and Media Manager on firstname.lastname@example.org or 07825942934
2. Details on today's announcement can be found at https://www.gov.uk/government/news/billion-pound-support-package-for-innovative-firms-hit-by-coronavirus.
About the BIA
Established over 25 years ago at the infancy of biotechnology, the BioIndustry Association (BIA) is the trade association for innovative life sciences in the UK. Our goal is to secure the UK's position as a global hub and as the best location for innovative research and commercialisation, enabling our world-leading research base to deliver healthcare solutions that can truly make a difference to people's lives.