The Campbell Report: a roadmap to investment for health innovation life sciences and healthtech

This Working Group brought together a diverse group of professionals from across the life sciences and healthtech ecosystem, and was chaired by Dr Ian Campbell, Chief Business Officer, LifeArc. Their aim was to explore how to attract increased levels of private investment in the sector in Scotland.

Recommendations: An enabling ecosystem for scaling life science companies

For building the enabling conditions for life science companies to scale and flourish

We recommend that the Scottish Government and Enterprise Agencies

4. Review and enhance Scottish public sector support for health innovation life science scaling companies, including the grant process.

5. Provide support for Scottish SMEs to access recruiters to attract, recruit and retain international growth management and entrepreneurial talent.

6. Develop and maintain a network of local and international health innovation life science investors (including VC, PE and institutional). This will provide facilitated access to Scottish innovation for investors. For Scottish scaling companies this will provide a network to pitch to, and get feedback from.

We recommend that universities

7. Work together to build on best practice and continue to develop and integrate world-leading entrepreneurial and scaling programmes into the curriculum for life science students.

8. Include industry placement/SME/start-up working experience for all graduate-level courses to provide more 'Employer Ready Graduates'.

We recommend that companies

9. Of all sizes and stages, provide placement opportunities working more closely with universities and public sector organisations to facilitate industry and start-up experience.

10. At the corporate level, support entrepreneurs to explore start-up ideas, and encourage international collaboration of innovation and start-up activity through, for example, exchanges between international sites.

Understanding the capital needs of health innovation companies

The Scottish Technology Ecosystem Review (STER) (2020) by Mark Logan (former COO, Skyscanner) identified 34 wide-ranging recommendations for developing a world-class tech ecosystem in Scotland. The recommendations cover three core themes: people, infrastructure, and investment. The Scottish Government accepted all of the recommendations and actions to deliver are underway. The scope of STER includes healthtech, and the sector stands to benefit from the system-wide approach of the Review. Some of the recommendations, while focused on the tech ecosystem, have wider relevance within our economy. For example, the review's focus on supporting companies to scale will help to develop the enabling conditions for a range of health innovation businesses to flourish in Scotland. However, the nature of health innovation life sciences and healthtech, including longer pre-revenue stages and higher earlier stage capital-raising requirements, means that investment (and particularly availability of patient capital) should be considered based on the bespoke needs of health innovation companies. The same is true for public sector support. For potentially disruptive new technologies being developed (and especially those that have the potential to address health and care priorities), support at pre-revenue stage may warrant special consideration to the support offered to other parts of the economy.

Technical skills

A critical mass of talent is central to a successful health innovation life science cluster. The Life Sciences Scotland Industry Leadership Group (ILG) has established a subgroup on skills to focus on life science technical skills, including apprenticeships and new entrants to the sector from Further and Higher Education. This work will be crucial for ensuring that the workforce in Scotland is able to support delivery of the ILG's vision for the sector and maintain high levels of growth. New entrants to the health innovation and healthtech workforce require the industry skills and experience to thrive in entry level roles. Placements as part of degree programmes help to ensure that we have industry-ready graduates. More companies (at all stages) are needed to offer these valuable opportunities to help prepare our future workforce.

A scaling ecosystem for world leading innovation: Elasmogen

Caroline Barelle is the CEO and a co-founding member of the Aberdeen University spin-out company Elasmogen Ltd, a therapeutics biologics company located in Aberdeen. Elasmogen leverages its soloMER technology platform to develop antibody-like drugs for autoimmune diseases and cancer. The company has succeeded in collaborating with a number of pharma and biotech companies including the development of a novel soloMER drug conjugate with their partners, Almac Discovery (Edinburgh/Belfast), aiming to enter the clinic in 2023 for triple negative breast cancer. Elasmogen is currently raising a Series A round to transform from a pre-clinical into a clinical stage company, to expand the team and pipeline and to transition the company into the brand new Aberdeen BioHub in 2022. Elasmogen is one of a number of biologics companies to come out of the thriving cluster of drug-discovery companies now found in Aberdeen.

Executive teams and growth management skills

It is not only necessary to ensure that entrants to the workforce have a high level of technical skills; the shortage of commercial and entrepreneurial skills must also be addressed. These skills are required to build executive teams that are confident and capable of raising investment, and able to scale businesses through development of high tech, novel products and services across the health and life sciences sector. At the moment, Scotland lacks the critical mass of growth management expertise needed for the sector to flourish. Feedback from global capital investors suggests that addressing this should be a priority; however, this can be challenging for scaling companies facing competing priorities. Furthermore, the costs attached to recruiting, training and retaining the best talent (from both the domestic and international talent pool) can be prohibitive for early stage companies. The Working Group has therefore recommended that greater support is put in place to help scaling companies access the right skills to support the next level of growth. Making greater use of international networks will be an important part of developing capability locally.

Entrepreneurial skills in universities

Scottish universities recognise the importance of students having the entrepreneurial and commercial skills to become future innovators and industry leaders. Development of these skills has been integrated into a number of degree programmes. There is scope for this to be further embedded and scaled up across health innovation degree programmes and universities as a whole for greater collaboration to learn from best practice. Important steps have been taken in recent years to address the skills gap in life sciences, in order to improve the compatibility of industry-led demand and academia-led provision. The Scottish Universities Life Sciences Alliance (SULSA) has been successfully working collaboratively across 11 Scottish universities, with industry, innovation centres, skills and enterprise agencies and is well placed to help establish the responsive portfolio of skills training programmes required. Companies (particularly large multinational corporates) also have a role to play here. This includes through supporting local start-ups and scale-ups to network internationally and develop ideas into IP assets and commercially viable products.

Connecting supply and demand

In developing this roadmap, the Working Group have engaged with investors from Scotland, the UK, North America and Asia. Scotland's reputation for innovation puts us on the map for investors, and there is considerable interest in investment opportunities. As already set out, there is more work needed to communicate those opportunities, and how easy it is to do business here. There is an increasing supply of internationally mobile capital available for investment, but there is also a competitive global market creating the demand for capital. International health innovation clusters offer a range of incentives to attract investors, including public co-investment in major projects, which brings greater confidence, in addition to practical support measures. As a cluster, we should seek to build our network of local and international investors, to whom enterprise agencies can focus their efforts in promoting opportunities. This is a potential win-win situation. Investors will have greater awareness of investment opportunities. Innovators and early stage companies will have a network of investors to pitch to, and a closer relationship will bring greater opportunity for investors to provide feedback and guidance on pitching.



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