BIA welcomes Budget announcements to improve access to scale-up capital in response to Patient Capital Review

The Chancellor has today announced the outcome of the Patient Capital Review, which will deliver a £20bn package to support investment in innovative companies over the next 10 years.  The Review was launched by chancellor Phillip Hammond a year ago and has been looking at how to increase access to finance, and especially long-term investment, for innovative growing companies. The outcome of the review has been hotly anticipated by the bioscience sector and key policies announced today were called for in the recent BIA response to the Patient Capital Review. 

The key announcements, including many that the BIA called for, from the 2017 Budget are:

Tax relief changes:

  • Doubling the annual allowance for people investing in knowledge-intensive companies through the Enterprise Investment Scheme (EIS) to £2 million
  • Doubling the annual investment that knowledge-intensive companies can receive through the EIS and Venture Capital Trusts (VCT) to £10 million. Both these changes will be effective as of April 2018 and already have State Aid clearance.
  • Introducing further flexibility for these companies over how the 10-year maximum company age test for the first investment is applied
  • The Treasury will introduce a test to prevent investments in low-risk companies through these schemes, potentially targeting that money to truly innovative sectors - like life science
  • The R&D expenditure credit is to be increased to 12%, which will benefit companies that have received R&D grants from the government and larger companies (SMEs already enjoy a 33% rate)
  • Founding shareholders will be able to keep their relief on capital gains made during the period that they held over 5% of company shares before being diluted during funding rounds. The details will be consulted on next year.  

New investments

  • A £2.5bn fund will be established in the British Business Bank (BBB) to invest in innovative companies, this will be a co-investment fund with private finance and will be floated or sold once it has a proven track record
  • A series of funds of funds will be established with a first £500m tranche invested through the BBB and then at least a further two similar investments over the next 10 years
  • First-time and emerging fund managers will continue to be supported through the British Business Bank’s existing Enterprise Capital Fund programme
  • The government stands “ready to step in to replace EIF funding if necessary”


  • The Pensions Regulator will provide clarity around the ability of pension fund managers to invest in venture capital and innovative companies
  • The government will address barriers holding back Defined Contribution pension savers from investing in illiquid assets, such as private companies

NHS spending

  • The Chancellor announced an additional £2.8bn for the NHS “to improve NHS performance and ensure that more patients receive the care they need more quickly.”

BIA CEO, Steve Bates, said: “These Budget announcements show the government has taken on board calls from the BIA and its members by recognising the value of our sector to the UK economy now and in the future. Using tax reliefs to nudge wealthier investors into crucial growth sectors for the UK economy post-Brexit is sensible, combined with rules to ensure that taxpayer support is correctly targeted and not gamed.

“The UK life sciences sector already has a strong record of attracting venture capital investment. The investment in the British Business Bank, and greater flexibility given to the Enterprise Innovation Scheme and Venture Capital Trusts, will help to build on this success to ensure the UK is a growing global biotech cluster.

"Today's Budget announcement enables UK investors to efficiently back growing British businesses as they scale to global leadership. We will now work to showcase the life science investment opportunities available that effectively use these policies."


Notes to Editors

You can download the BIA submission to the patient Capital Review here:

Contact: Ed Sexton, BIA Communications and Media Relations Manager:  or call 0207 630 2196

About the UK BioIndustry Association (BIA)

Established over 25 years ago at the infancy of biotechnology, the BioIndustry Association (BIA) is the trade association for innovative enterprises involved in UK bioscience. Members include emerging and more established bioscience companies; pharmaceutical companies; academic, research and philanthropic organisations; and service providers to the bioscience sector. The BIA represents the interests of its members to a broad section of stakeholders, from government and regulators to patient groups and the media. 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.

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