US drugmaker Merck, known as MSD in Europe, has scrapped plans for a £1bn research centre in London and is laying off 125 scientists in the capital, dealing a major blow to the UK's life sciences sector. The planned UK Discovery Centre at King's Cross, already under construction and due to open in two years, was expected to employ around 800 people, including 180 scientists.
MSD will vacate laboratories at the London Bioscience Innovation Centre and the Francis Crick Institute by the end of 2025, affecting 125 scientific jobs. The company said it would move research operations to other sites but declined to provide further details, amid pressure from Donald Trump for pharmaceutical firms to invest more in the US.
In a statement, MSD cited “the challenges of the UK not making meaningful progress towards addressing the lack of investment in the life science industry and the overall undervaluation of innovative medicines and vaccines by successive UK governments.” The decision follows a breakdown in negotiations over the cost of medicines under the voluntary pricing and access scheme, where the rebate rate rose to 23.5% in 2023, compared with 5.7% in France and 7% in Germany.
Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry (ABPI), said: “This is a real blow to the UK’s life sciences ambitions. No one wants to hear that successful and innovative companies like MSD are reducing their investment and footprint in the UK.” A government spokesperson said the UK remains attractive for investment but acknowledged more work is needed.
A report from the ABPI and PwC found that UK life sciences R&D investment growth slowed to 1.9% annually from 2020, lagging behind the global average of 6.6%, and fell by nearly £100m in 2023. Foreign investment in UK life sciences dropped 58% from £1.9bn in 2017 to £795m in 2023, causing the UK to slip from second to seventh in global rankings. The UK also fell from fourth to eighth for late-stage clinical trials.
