LONDON — A growing number of British science and technology companies are shifting their expansion efforts abroad, citing a stifling domestic environment marked by regulatory hurdles, funding gaps, and a shortage of skilled labor. According to a report released Tuesday by the UK Science and Innovation Network, over 40% of surveyed biotech and deep-tech firms have established or expanded overseas operations in the past two years, with the United States, Germany, and Singapore emerging as top destinations.
The trend, dubbed a 'tech brain drain,' threatens to undermine the UK's ambition to become a 'science superpower' — a goal championed by Prime Minister Rishi Sunak. 'We are losing our competitive edge,' said Dr. Emily Harrison, a policy fellow at the Francis Crick Institute. 'Promising startups are scaling abroad because they find more patient capital, clearer regulatory pathways, and larger talent pools elsewhere.'
Data from the report shows that UK venture capital investment in deep tech fell by 18% in 2023, while countries like France and Germany saw increases. Meanwhile, the UK's decision to associate with the EU's Horizon Europe research program has been slow to yield tangible benefits, and domestic visa restrictions have made it harder to recruit non-UK researchers.
One case in point is OxGene Therapeutics, a gene-editing startup that moved its headquarters to Boston last year. 'We had to choose between raising funds at a lower valuation in the UK or accessing a more mature ecosystem in the US,' said CEO Dr. Alan Reid. 'The decision was clear.' OxGene joins a list of high-profile UK-born firms, including Autolus Therapeutics and Vaccitech, that have established significant US presences.
The government has acknowledged the issue. A spokesperson for the Department for Science, Innovation and Technology said, 'We are committed to creating the best environment for science businesses to thrive, including through our £20 billion R&D investment and plans to reform pension funds to unlock capital for innovative firms.' However, critics argue that these measures are too little, too late.
Professor Sir John Bell, a former government adviser on life sciences, warned that without urgent action, the UK risks becoming a farm system for other economies. 'We train brilliant scientists and then export them along with our most promising companies. That is a recipe for long-term decline.'
The report recommends creating a dedicated fund for scale-up capital, streamlining clinical trial approvals, and adopting a more competitive visa regime for tech talent. Whether the government heeds these warnings may determine whether the UK can reverse the outflow or watch its scientific leadership erode further.
