End barriers to innovation, says ALEX BRUMMER

The best that can be said about the latest snapshot of the UK economy is that for the moment at least the nation is skirting around a downturn. The economy grew by 0.1 per cent in the first quarter and 0.2 per cent year-on-year.

What is encouraging is that business investment is perking up, with the official figures showing a 3.3 per cent jump, a sharp upward revision from the previously reported 0.7 per cent.

Rishi Sunak’s government is seeking to boost business by means of the 100 per cent capital allowances for new investment.

The Treasury is also making hyperbolic claims that the passage of the new financial services bill, unhitching the UK from the European Union, could release as much as £100billion for innovation and infrastructure.

Support for the City and for London listings is critical and we should be enthusiastic about Chancellor Jeremy Hunt’s determination to embrace high tech and AI.

But it is not just money that is needed.

The new arrangements may free the Square Mile from choking EU regulation but it does nothing, as yet, to ease the burden of domestic red tape. Life sciences are an area where there are big wins for Britain. Barely a day passes when our flagship pharma firms, AstraZeneca and GSK, fail to announce a positive drug or vaccine development to investors.

GSK is making great headway on vaccines for RSV respiratory diseases. It is the world leader in developing simpler and easier-to-administer HIV vaccines.

And its shingrex vaccine has won approval in Japan for preventative treatment against shingles for adults over the age of 18.

The good thing about vaccines, where GSK is a global leader, is that they have a much longer lifespan than many drugs.

Most people in Britain are familiar with the name of Astra because of its embrace of the Oxford-developed Covid vaccine and its skill in scaling up into global production. We all stood in the queues at vaccine centres where the subject of debate was whether the Astra or Pfizer vaccine would be administered.

What is less recognised about Astra is the way it conquered the world since it saw off the £69billion bid from Pfizer in 2014.

Under the stewardship of Aussie-French chief executive Pascal Soriot, it has become the FTSE 100’s most valuable company, with a market capitalisation of £181m.

Fuelled by its fast-track development of immunology treatments for cancer, it is now worth billions of pounds more than former predator Pfizer.

Astra’s market recognition provides a counterpoint to critics of the London Stock Exchange. It shows that well-run, innovative firms can achieve as great valuations in the City as on Wall Street.

Astra’s pipeline flourishes. Approvals are coming through fast and thick from overseas. In the last week, the US Food and Drug Administration endorsed farxiga to prevent deaths of patients with heart disease, and Beijing gave the thumbs up to its once-a-day drug for type 2 diabetes.

A concern for UK big pharma is the failure in Whitehall to grasp the opportunity for Britain to be a pioneer in life sciences.

All the pieces of the puzzle are there.

Astra and GSK are creating their own eco-systems through investment in biotech, genetic-specific medicines and, in Astra’s case, open access research labs in Cambridge.

The NHS offers huge opportunity for testing and analysing new vaccines and compounds. But fractured IT, backlogs in treatments and chaos engendered by strikes means it is not a reliable partner for our pharma pioneers.

The UK vaccine and drug agencies, the joint committee on vaccination and immunisation and the MHRA, which acted with speed and decisiveness in the pandemic, appear oblivious to the commercial advantage to be gained by faster approvals.

Our life sciences firms are raring to go and medicines, long in the pipeline, are coming to fruition. How frustrating that the country is being held back by blockages at home, even though we are in a new world where UK drug makers are no longer dependent on the politically complex and sclerotic European Medicines Agency.

If the Treasury really wants to put rocket fuel into growth it must make sure that the NHS and the drug regulatory agencies have appropriate resources to keep Britain’s innovators ahead of the pack.