US pharmaceutical giant Merck has scrapped plans for a £1 billion expansion in the UK, blaming weak government support for the life sciences sector.
The company, known as MSD in Europe, said it will shift its research focus to the US and cut jobs in Britain. It accused successive UK governments of undervaluing new medicines and vaccines.
Construction had already started on a major new site in London’s King’s Cross, due to open in 2027, but Merck said it would not move in. It will also close its labs at the London Bioscience Innovation Centre and the Francis Crick Institute by the end of the year, cutting 125 jobs.
A Merck spokesperson said the move reflected the UK’s “lack of meaningful progress” in investing in life sciences.
Fears of a wider exodus
Industry experts warn other drug companies could follow Merck’s lead. Sir John Bell, professor of medicine at Oxford University, told the BBC that several pharma bosses have already decided to stop investing in the UK.
He pointed to falling NHS spending on medicines, now at 9% of healthcare budgets compared with 15% a decade ago. In other developed countries, that figure is 14 to 20%.
“The big companies will go where they can sell their products,” Bell said.
Richard Torbett, head of the Association of the British Pharmaceutical Industry, called Merck’s decision “an incredible blow” and said it should serve as a wake-up call.
Political fallout
Science minister Ian Murray called the decision “deeply disappointing” but said it was a commercial choice. He blamed global economic pressures and US trade policy, noting the Trump administration has pushed pharma firms to invest more in America, even threatening tariffs of up to 250% on imported drugs.
Conservative shadow science secretary Julia Lopez said the message from Merck was blunt. “Simply put, the UK is not internationally competitive. The government must wake up, and do so now.”
The Department of Industry said the UK remained attractive for investors but admitted “more work” was needed.
A wider trend
Merck is not the first to walk away. Earlier this year, AstraZeneca abandoned plans to expand a vaccine plant in Merseyside, citing weak government backing. The company also chose Ireland over the UK for a new factory in 2023 after calling Britain’s tax rates “discouraging.”
Novartis has also warned that Britain is becoming “largely uninhabitable,” with patients losing access to new treatments as a result.
Despite the setbacks, some in the industry argue the UK still has world-class strengths. Dr David Roblin of London biotech firm Relation Therapeutics said the academic environment and NHS research platforms remain powerful draws for investors.
But with the US still the world’s biggest drug market, political pressure there is increasingly shaping where pharma companies put their money.
Labour has pledged to overhaul NHS procurement and speed up drug approvals as part of its life sciences plan, aiming to make Britain more competitive again.
