Research and analysis

Life sciences competitiveness indicators 2024: user guide

Published 11 July 2024

This document accompanies the LSCIs 2024 report and outlines the methodology behind the indicators. For each section of the report, it provides detail on:

• Any changes to the report compared to the LSCIs 2023 publication
• Data sources used for the metrics
• The methods used and caveats to be aware of when interpreting the report

Data tables

The underlying data behind the charts can be found in the accompanying ‘life sciences competitiveness indicators 2024: data tables’.

Metrics included in the LSCIs

The LSCIs, since 2022, have been published alongside an accompanying document, life sciences competitiveness indicators 2024: life sciences ecosystem, which outlines the set of interacting elements impacting the life sciences ‘value chain’, which comprises the activities carried out by the key players in the sector to achieve the twin goals of improving UK health outcomes and achieving economic growth.   

The LSCIs have been aligned to the elements of the life sciences ecosystem they intend to measure. Please see the accompanying life sciences ecosystem document for more details.

Comparator countries

Where possible, comparisons are made between the UK and countries with similar levels of economic development. This aim is restricted in many cases by data availability. The visualisations in this report aim to compare the UK to the top comparator countries in each area (where data availability allows); further data for all comparator countries is available in the accompanying ‘life sciences competitiveness indicators 2024: data tables’.

2024 publication updates

The LSCIs are published each year as part of a collection of ‘research and analysis’ reports. From the 2024 report and onwards, OLS commit to a voluntary application of the Code of Practice for Statistics in the compilation and dissemination of these reports. This is to provide users with further information on the standards of the data and processes used in the LSCIs. This year’s report is accompanied by a statement on voluntary application which outlines where the LSCIs applies principles from the code and highlights places where there are deviations or proposals for improvement in the longer term.

The 2024 collection for the LSCIs reports on the same metrics as the previous 2023 report, where data availability allows. A summary of notable changes in the reporting for 2024 is below:

• New data for the metric ‘gross domestic expenditure on medical and health sciences R&D performed by the higher education sector as a percentage of GDP’ is not reported in this year’s LSCIs due to the fact that recent data is unavailable for the UK. This is because there has been a change in the data source used by ONS to provide data on the UK to OECD, which has resulted in UK higher education R&D expenditure data being unavailable for 2018 onwards.

• The Office for National Statistics have carried out methodological developments on their business enterprise research and development (BERD) statistics, which have resulted in a large uplift in the value of expenditure on pharmaceuticals R&D performed by UK businesses that was reported in previous LSCIs publications. These methodological developments caused a discontinuity in the timeseries, so ONS have presented BERD pharmaceutical R&D data for 2022 only as of June 2024.

• The data source for the metrics on exports and imports of pharmaceutical and medical technology products has changed in this year’s publication. This data is now extracted from UN Comtrade instead of UNCTAD (the source used in previous years), meaning that it has been possible to obtain data using a more granular and comprehensive selection of commodities relating to the life sciences sector. The result of this change has been that coverage of the sector’s trade in goods has been improved, and the breadth of medical technology products in particular is now captured more fully. This has had minimal impact on the UK’s positioning compared to other countries.

• Due to the fact that the UK is no longer part of Eurostat data collection, it has been necessary to find a new data source for pharmaceuticals and medical technology manufacturing employment. OECD data on employment by economic activity has been used to replace the Eurostat data for pharmaceuticals manufacturing employment, but this data is not sufficiently granular to provide equivalent data on medical technology manufacturing employment. As a result, the metric on medical technology manufacturing employment has been omitted from this publication - OLS will continue to search for a suitable data source to provide this data in the future.

Any further changes on metrics compared to the 2023 report are outlined below in the relevant sections.

Research and Development

Changes from previous reports

Gross domestic expenditure on medical and health sciences R&D performed by the higher education sector

As noted in the above section ‘2024 publication updates’, data for the metric ‘gross domestic expenditure on medical and health sciences R&D performed by the higher education sector as a percentage of GDP’ is no longer available. ONS provide data to OECD on overall higher education R&D expenditure and have changed the underlying source for this data. UK data is only available up to 2017 due to this change. This data is still available to view in the life sciences competitiveness indicators 2024: data tables along with more recent data for comparator countries.

OLS will consider options for obtaining more recent data on R&D spend in the higher education sector for future reports.

Gross domestic expenditure on pharmaceutical R&D performed by the business enterprise sector

The Office for National Statistics have carried out methodological developments on their business enterprise research and development (BERD) statistics, which have resulted in a substantial uplift in the value of expenditure on pharmaceuticals R&D performed by UK businesses that was previously reported in this publication. In the 2022 LSCIs publication, it was reported that the value of pharmaceuticals R&D performed by UK industry was £5.0 billion in 2020, which accounted for 19% of the total spend on R&D performed by UK businesses. Using the latest data from ONS, which was collated under the new methodology, the value of pharmaceuticals R&D performed by UK industry in 2022 was £9.0 billion. However, due to the uplift across all areas, pharmaceuticals R&D still accounted for a similar proportion (18%) of the total R&D spend in 2022.

These methodological developments caused a discontinuity in the timeseries, so only 2022 data is available as of June 2024. ONS are seeking to produce a time series with comparable estimates across time periods in the near future – please read ONS’s latest BERD publication page for more information.

Data source

The following list of indicators are all sourced from the Organisation for Economic Cooperation and Development (OECD) Science, Technology and Patent statistics (for the UK these figures are provided by the Office for National Statistics (ONS) to OECD):

• government budget allocations for health R&D as a percentage of GDP
• gross domestic expenditure on medical and health sciences R&D performed by Government as a percentage of GDP
• gross domestic expenditure on R&D performed by the private non-profit sector as a percentage of GDP
• gross domestic expenditure on medical and health sciences R&D performed by the higher education sector as a percentage of GDP

Gross domestic expenditure on pharmaceutical R&D performed by business enterprises (UK only) as a percentage of GDP is sourced from ONS’s Business Expenditure on R&D publication.

The estimates of GDP used in this section are also sourced from OECD’s Science, Technology and Patent statistics.

Methodology

R&D can be measured by the expenditure on R&D performed by an organisation, or the amount of R&D funded by the organisation. Funding received to perform R&D can come from the organisation itself, organisations within the same sector, or a separate sector of the economy. More information on the flows between R&D funded and performed in the UK can be found in the ONS publication on Gross Domestic Expenditure on R&D, covering R&D across all industries in the UK.

The LSCIs consider R&D expenditure directly performed by the life sciences sector or R&D that influences the life sciences ecosystem, where available.

The LSCIs report the amount of R&D relevant to certain aspects of life sciences performed by government, higher education, private non-profit, and business sectors. These are the 4 sectors of the economy defined in the Frascati Manual 2015. R&D data for these sectors is referred to collectively as gross domestic expenditure on R&D (GERD).

It is not possible to provide a country ranking for expenditure on life sciences R&D performed by the business sector, but data is presented for pharmaceutical R&D performed by UK businesses. As mentioned in the ‘Changes from previous reports’ section of this document, this data is available for 2022 only due to a change in the ONS’s methodology which caused a discontinuity in the time series. This data only covers pharmaceutical R&D performed by UK businesses, and therefore excludes other areas of the broader life sciences sector such as medical technology. International data is available for expenditure on medical and health sciences R&D performed by the government and higher education sectors.

Medical and health sciences is a subject classification of Field of Research and Development (FORD) used in the of the OECD Frascati Manual 2015. This includes the following second-level classifications:

• Basic medicine
• Clinical medicines
• Health sciences
• Medical biotechnology
• Other medical sciences

The private non-profit estimates in this publication represent R&D across all industries and not exclusively medical and health sciences. In the UK, the private non-profit R&D sector comprises mainly medical research charities, and it is assumed that the majority of private non-profit R&D will be in life sciences fields. This is not necessarily the case for other countries and the corresponding figures may include R&D outside life sciences to some degree.

Medical and health sciences is defined as a subject classification in the OECD Frascati Manual 2015.

Government budget allocations for R&D (GBARD) on health are included in the indicators, as budget allocations can provide a more timely indication of how R&D is changing over time, particularly for sectors highly reliant on government funding, such as higher education. Health R&D is a classification of socio-economic objective as defined in the OECD Frascati Manual 2015. This is defined by the primary objective of the R&D.

R&D metrics in the LSCIs are presented as a percentage of Gross Domestic Product (GDP).

Clinical trials

Changes from previous report

Metrics for clinical trials in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

Data for metrics on ‘Time from clinical trial application to a regulatory authority to first dose to first patient (all trial phases)’ and ‘Share of recruits to global clinical trials’ are both collected from 2022 Centre for Medicines Research (CMR) Global Clinical Performance Metrics, Clarivate. This includes data from 25 companies that participated in data collection activities. Of the 25 companies, 14 companies were classified as Major Pharma having an annual R&D expenditure of more than $2 billion. The remaining 11 companies were classified as Mid Pharma having an annual R&D expenditure of less than $2 billion.

On receipt by CMR International, data were audited and checked with participants if anomalies were found. The audited data were then used for creating the outputs.

The Global Clinical Performance Metrics Programme has been annually gathering clinical performance metrics information for the past 20 years and the total dataset includes around 30,000 trials and over 100,000 trial country level records.

The number of commercial trials used in the LSCIs report can be found in tables 6 and 7 in the life sciences competitiveness indicators 2024: data tables.

Data for table 2 in the main report is extracted from the National Institute of Health and Care Research (NIHR) Clinical Research Network (CRN) and covers all interventional trials in the UK on the NIHR CRN portfolio.

Table 3 in the main report shows the median number of days taken to reach  approval in the UK for commercial Clinical Trials of an Investigational Medicinal Product (CTIMP), with a separate row for those that were reviewed through the combined review. This data is management information sourced from the Health Research Authority (HRA).

Methodology

Clinical trial data extracted from CMR only includes trials that are:

• commercial (trials where a pharmaceutical company was the sponsor),
• interventional (where a new medicine is tested in participants), and
• for novel medicines (newly launched medicines or recently launched for a new indication)

As a result, the data in this report for share of patients and time from regulatory application to first patient first dose will not include non-commercial studies or observational studies.

Data from CMR is collected from 25 pharmaceutical companies and is therefore just a subset of all commercial trials conducted across the comparator countries. The number of trials included in the analysis for each metric is available in the accompanying ‘life sciences competitiveness indicators 2024: data tables’.

Data from CMR includes all therapeutic areas and the below trial phases:

Table 1: Trial phases included in the CMR data and definitions

Phase	Phase definition
Phase I (in healthy volunteers)	Studies conducted in healthy human volunteers. This can include but is not limited to dose-ranging (single or multiple ascending dose), tolerability, pharmacokinetic, pharmacodynamic, metabolic and drug/food interactions studies
Phase (in patients)	Phase I studies conducted in patients with the target disease either with the intention of treating the disease (i.e. to show a treatment effect) or pharmacokinetic testing or dose response studies where the intention is not to treat the disease
Phase II	Phase II studies are early controlled studies in a limited number of patients under closely monitored conditions to show efficacy and short-term safety. An important goal for this phase is to determine the dose(s) and regimen for Phase III studies. Additional objectives of clinical studies conducted in Phase II may include evaluation of potential study endpoints, therapeutic regimens (including concomitant medications) and target populations (e.g. mild versus severe disease) for further study in Phase II or III
Phase II a	Phase II studies which are initiated prior to clinical proof of concept
Phase II b	Phase II studies which are initiated after clinical proof of concept
Phase III	Phase III studies usually have the primary objective of demonstrating, or confirming therapeutic benefit. Phase III studies are designed to confirm the preliminary evidence accumulated in Phase II that a drug is safe and effective for use in the intended indication and recipient population. These studies are intended to provide an adequate basis for marketing approval
Phase III a	Phase IIIa studies are conducted after the efficacy of a drug is demonstrated, but prior to regulatory submission
Phase III b	Phase IIIb clinical studies are conducted following regulatory submission of a dossier, but prior to approval and launch
Post-marketing/post-approval commitment (PMC/PAC) clinical study	Any Phase IV clinical study that companies commit to at the time of approval, as required by or agreed with the regulatory authority

For the UK, clinical trials need to be approved by both the Medicines and Healthcare products Regulatory Agency (MHRA) and the Research Ethics Service (RES) provided by the Health Research Authority (HRA). More information on approval from MHRA can be found at Clinical trials for medicines: apply for authorisation in the UK and from HRA at Research Ethics Service and Research Ethics Committees.

As of 2022, all trials applications in the UK are subject to combined review from MHRA and HRA. Before 2022, applications could be initially submitted to either body, with the timelines for approval not necessarily being sequential or through the combined review process.

For trials that were not approved through combined review, the starting point for the metric takes the date from whichever body the applicant submitted to first.

Data is extracted from Clarivate’s CMR database annually for the most recent time period only. As a result, the data in the time series is not back dated with more recent information if it becomes available after extraction.

Management information sourced from HRA is used to populate data in table 2 in the main report, which shows the median number of days for commercial clinical trial approval in the UK, with a separate row for trials that were reviewed through the combined review. This data also includes only commercial trials that were a Clinical Trial of an Investigational Medicinal Product (CTIMP), the vast majority of which will be interventional as opposed to observational studies. This data also includes all trial phases as outlined in table 2.

Citations

Changes from previous reports

Metrics for citations in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

The data source for the 2 citations metrics is Scival, a web-based analytics solution providing access to research performance data. The main source of data for Scival is a citations database named Scopus.

Methodology

For the 2 citations metrics, the Field of Research and Development (FORD) subject classification used in the Frascati Manual 2015 of the OECD is used. The data is filtered by this classification to acquire research performance data for ‘medical sciences’ publications for the UK and each of the comparator countries. The ‘medical sciences’ classification consists of the following second-level classifications:

• basic medicine
• clinical medicine
• health sciences
• medical biotechnology
• other medical sciences

The ‘Percentage share of global medical sciences academic citation count’ metric is calculated by taking the medical sciences citation count for each country and dividing by the world total medical sciences citation count.

The ‘output in the top 1% citation percentile (%)’ metric is calculated by taking the number of medical sciences publications for each country which are amongst the top 1% most cited globally as a proportion of that country’s total scholarly output (total publication count).

Scival updates on a weekly basis, and citations-based data is likely to differ depending on when the data was extracted, as citations accumulate over years and are ever-changing. The citations data presented here was correct as of the date of extraction from Scival in April 2024.

Patents

Changes from previous reports

Data on patents were published in the LSCIs for the first time in the 2022 report and did not feature in past reports. There was a revision to the methodology for calculating the relative specialisation index (RSI) in the 2023 report - the time series in 2023 has been backdated with this methodology and more details on this change can be found below.

Data source

The data source for this metric is PATSTAT, a worldwide patent statistical database provided by the European Patent Office (EPO).

Methodology

To identify and extract life sciences-related patents from EPO’s data, a search strategy was developed in collaboration with colleagues from the Intellectual Property Office. This search strategy was broadly based upon the following 4 WIPO35 technology fields, which are designed using groupings of International Patent Classification (IPC) areas:

• 11: analysis of biological materials
• 13: medical technology
• 15: biotechnology
• 16: pharmaceuticals

A number of additional inclusions and exclusions were made to align our search strategy more closely with the definition of life sciences used in the OLS report on the Bioscience and Health Technology Sector Statistics (BaHTSS) - for more information see the BaHTSS user guide. This involves excluding patents related to cosmetics and veterinary products, and including patents relating to items not covered by the above 4 categories, such as surgical gowns and facemasks.

For this metric, the UK’s data is given alongside a selection of comparator countries consisting of other G7 countries, BRICS countries (Brazil, Russia, India, China and South Africa), and Switzerland.

The relative Specialisation index (RSI) is based on the country in which a patent was filed (rather than the applicant country). Filing country can be used to infer intended markets for a product, and as an indication of where a product may be manufactured. Therefore RSI is indicative of the extent to which a country is a ‘specialist hub’ for marketing/manufacturing life sciences products.

It’s important to note that RSI is only one of many ways of measuring specialism, and it should not be used in isolation to evaluate the UK’s innovation/inventiveness in life sciences.

where X is given by,

Where:

• n_c,t = number of patent filings for country c in technology t
• N_t = sum of patent filings in all countries in technology t
• N_c = number of patent filings for country c
• N = sum of patent filings fo all countries

An RSI value greater than 0 indicates that a country has a higher share of patent families in a particular technology relative to its overall share of patent families. In other words, a value greater than 0 indicates that a country is somewhat specialised in this technology in patenting compared to its overall patenting level. This may be alternately considered as meaning that the country is relatively more engaged in the technology with its available patent resources compared to other countries.

The use of a normalised RSI has the advantage of being bounded between (-1,1), unlike a log-based RSI (which was used in this analysis prior to the 2023 report), allowing for more certainty when comparing RSI values. The use of normalised RSI in patent analysis also aligns with the wider use of normalised RSI in analysing scientific and research publication activity. More details can be found on the below pages:

• The effect of booming countries on changes in the relative specialization index (RSI) on country level SpringerLink
• On standardization of the Activity Index - ScienceDirect

The normalisation method has been applied since the LSCIs 2023 report and all figures in the timeseries have been backdated with this methodology. More details on the previous methodology and the change can be found in the LSCIs 2023 user guide.

Access to medicines

Changes from previous publications

The UK no longer uses European Medicines Agency (EMA) processes, as the Medicines and Healthcare products Regulatory Agency (MHRA) has been the sole regulator of medicines from 2021 onwards. As a result, there has been an change to the way median time to availability has been calculated for recent figures for England and Scotland. This change affects data relating to the years 2021 and 2022 within the latest cohort of data (the period ‘2019-2022’) only, and has not been backdated to previous time periods. There are also considerations on interpretation of more recent figures given the UK’s departure from the European Union and the end of the transition period at the end of 2022. The ways in which these changes have impacted the figures in the report are described in the methodology section below.

Data source

Data on the metrics percentage of new medicines available and time to availability for new medicines is collated from the EFPIA Patients W.A.I.T (Waiting to Access Innovative Therapies) Indicator Survey which is publicly available through EFPIA’s publication page..

Methodology

The rate of new medicines available in based on the number of medicines that are new active substances and received central marketing authorisation in Europe in the relevant time periods. The text below on the central authorisation procedure is taken from the European Medicines Agency’s (EMA) page on authorisation of medicines, which provides more information on the subject.

Under the centralised authorisation procedure, pharmaceutical companies submit a single marketing-authorisation application to EMA. This allows the marketing-authorisation holder to market the medicine and make it available to patients and healthcare professionals throughout the EU on the basis of a single marketing authorisation.

Please note that for the UK, only England and Scotland are included in the rate of availability and time to access analysis due to the availability of data. Health Technology Assessment (HTA) submission and guidance typically varies among the UK countries. NICE positive guidance obligates mandatory funding in England and Wales, albeit with slightly different implementation timings, whilst Wales also has an independent HTA body – the All Wales Medicines Strategy Group (AWMSG). In Scotland, whilst NHS Boards are expected to follow SMC advice, the implementation of SMC accepted medicines is subject to local NHS Board decision regarding whether or not to include these in their formularies. Northern Ireland follow NICE guidance, but with some local interpretation.

 For England and Scotland, medicines are considered to be available when:

• England: NICE has issued a positive recommendation. For the remaining medicines, IQVIA sales data are analysed to determine if routinely available.
• Scotland: SMC has issued a positive HTA recommendation. For the remaining medicines, IQVIA sales data are analysed to determine if routinely available

Medicines which are recommended for a restricted patient cohort relative to licenced indication (NICE’s optimised recommendation or SMC’s restricted recommendation) are considered in this analysis to be available. See NICE’s webpage on technology appraisal guidance and SMC’s How we decide webpage for more information on outcomes of their health technology assessments (HTA).  

For more details on how medicines are defined to be available in other countries in the analysis and what medicines are included, please see the methodology section in the latest W.A.I.T indicator publication.

The time to availability takes the median length of time from authorisation received by the relevant medicines regulator to when a medicine is considered ‘available’ to patients. For the first time in this publication, a change has been implemented which affects the marketing authorisation date from which UK time to availability is measured. This change affects 2021 and 2022 data within the latest cohort of UK data (the period 2019-2022) only. For data relating to 2019 – 2022:

• for England and Scotland, the Medicines and Healthcare products Regulatory Agency (MHRA) marketing authorisation date is used for medicines that received marketing authorisation in 2021 or 2022. For medicines that received marketing authorisation in 2019 or 2022 the date of central marketing authorisation from the European Medicines Agency (EMA) is used
• for other countries, either the date of marketing authorisation from the European Medicines Authority (EMA) for EU countries or the relevant regulatory body in non-EU countries is used for all years.

For data relating to the periods 2018 to 2021 and before, all data for England and Scotland used the starting date of central marketing authorisation from the EMA. Following the UK’s exit from the EU, from 2021 onwards, the MHRA are the sole regulator to approve medicines for marketing authorisation in the UK. Data periods prior to 2019 to 2022 have not been backdated with this change so comparisons to past years should be made with caution.

From data relating to 2018 to 2021 onwards, medicines are considered available in England and Scotland when:

• England: For medicines with a positive NICE recommendation, the accessibility date is the date of published final draft guidance (cancer medicines) or date of published guidance + 90 days (non-cancer medicines). Cancer medicines benefit from earlier funding. For the remaining medicines, the IQVIA sales data is analysed to determine month of routine availability.
• Scotland: For medicines with a positive SMC recommendation, the accessibility date is the date of published final guidance. For remaining medicines, IQVIA sales data is analysed to determine month of routine availability.

For the periods prior to 2018 to 2021, the below milestones were used:

• England: For medicines with a positive NICE recommendation, the accessibility date is the date of published final guidance (cancer medicines) or date of published guidance + 90 days (non-cancer medicines). Cancer medicines benefit from earlier funding. For the remaining medicines, the IQVIA sales data is analysed to determine month of routine availability.
• Scotland: For medicines with a positive SMC recommendation, the accessibility date is the date of published final guidance + 90 days. For remaining medicines, IQVIA sales data is analysed to determine month of routine availability.

These changes reflect cancer medicines in England having earlier access to funding from the date of published final draft guidance via the cancer drugs fund (CDF). Non-cancer medicines in England must be funded by the NHS within 90 days of a positive NICE recommendation. The removal of the 90 days for non-cancer medicines in Scotland reflects the ability for Health Boards in Scotland to fund medicines as soon as SMC Guidance is published.

As a result of these changes the figures for the period 2018-2021 and onwards should be compared to past years with caution.

Other countries included in this report also use the date of central marketing authorisation in Europe, with the exception of Switzerland where local authorisation dates have been used. For more information on when a medicine is considered to be available in other countries, please see the methodology section in the latest W.A.I.T indicator publication.

Figures are only available for European countries in the EFPIA W.A.I.T Indicators and comparator countries for the LSCIs have been chosen based on the European countries used in the analysis of uptake. See the section on ‘Uptake’ for more information.

The data in the time series are based on the figures from published reports and past time periods are not revised in more recent reports. This means that the timeseries is not backdated with more up to date information if it becomes available.

The National Institute for Health and Care Excellence (NICE) adapted its priorities during the COVID-19 pandemic and paused appraisals of some new active substances. The rate of availability for England in the periods covering the years 2020 - 2022 may therefore be understated and trends over time should be treated with caution. Other countries included in the report may have faced similar impacts.

Uptake of medicines

Changes from previous publication

Metrics for uptake in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

Association of British Pharmaceutical Industry (ABPI) analysis of IQVIA MIDAS monthly sales data and HTA accelerator.

Methodology

The uptake ratio measures the relative adoption of new medicines in the UK compared to other countries. The uptake ratio is a measure of relative uptake in terms of days of therapy (DOT) per capita for new medicines recommended by NICE and first launched between 2014 and 2021. A ratio of the UK DOT per capita to the average DOT per capita for comparator countries is calculated for each medicine, and then the median of these ratios is taken to summarise how uptake in the UK compares to other countries – this value is hereafter referred to as ‘uptake’. 

The comparator countries used in this analysis are; Australia, Austria, Belgium, Canada, Finland, France, Germany, Ireland, Italy, Japan, Netherlands, Spain, Switzerland, Sweden, USA.

The majority of products do not have data available for each of the 15 comparator countries, meaning that the average uptake for certain products covers only a subset of the comparator countries.

Uptake in the LSCIs only considers medicines that have received a positive appraisal from NICE. Uptake is predominantly measured from the decision date from the relevant Health Technology Assessment (HTA) in each country. The exceptions to this are for Germany, Switzerland and the United States, where the date of regulatory approval is used. The date of regulatory approval is also used when the date for HTA decision is unavailable. If the HTA decision date and regulatory decision date are not available, the launch date in IQVIA sales data is used.

Medicines have different HTA decision and launch dates in each country. The metric normalises monthly DOT data to ensure the first 12 months of sales and subsequent years are analysed for each country.

Each LSCIs publication routinely revises data for periods that were previously published in past publications. For example, the figure relating to 2016 – 2020 published in the 2022 publication has been revised in 2023. Medicines were only included in this analysis if they had UK sales above £1 million in 2021 and were on sale for a minimum of 12 months in at least 4 of the comparator countries and the UK. Routine revisions can occur due to a different number of medicines meeting this criteria between publications.

The uptake ratio accounts for individual country population size, but not for need (number of cases and HTA authorities’ recommended coverage), standard clinical practice or total medicine spend in each country. It also does not adjust for the impact of different marketing or launch strategies in different countries. These factors are likely to have a substantial impact on uptake figures.

A median value for uptake is taken across all medicines for each country to show broadly how UK uptake compares to other countries. However, it should be noted that there is substantial variation between medicines in terms of the average uptake in the UK compared to other countries. Each medicine is weighted equally in the analysis but the eligible patient population varies substantially for different medicines and between different countries.

In many cases there is no consensus as to what the ideal level of uptake should be. As such, high or low usage should not be interpreted as good or bad performance in itself. Nonetheless, the uptake ratio with respect to an international benchmark may be used to understand how UK adoption of innovative products changes in the years following their introduction. 

This metric considers all 4 nations of the UK (England, Scotland, Wales and Northern Ireland) however it should be noted that Health Technology Assessment (HTA) process varies amongst the UK countries. For consistency, only NICE recommendations have been considered. Positive NICE guidance obligates mandatory funding in England and Wales, albeit with slightly different implementation timings, whilst Wales also has an independent HTA body – the All Wales Medicines Strategy Group (AWMSG). In Scotland, whilst NHS Boards are expected to follow SMC advice, the implementation of SMC-accepted medicines is subject to a local NHS Board decision regarding whether or not to include these in their formularies. Northern Ireland follow NICE guidance, but with some local interpretation.

It is being investigated whether it is feasible to adjust for some of the factors that may affect the uptake ratio for future reports.

Availability and utilisation of diagnostic technologies

Changes from previous publication

Metrics for availability and utilisation of diagnostic technologies in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

The data summarising both the availability and utilisation of diagnostic technologies is taken from the OECD. Stat database - the raw data can be found in the ‘Health Care Resources’ and ‘Health Care Utilisation’ folders respectively within the ‘Health’ theme page.

Methodology

These metrics give an indication of the differing levels of availability and utilisation in the UK and comparator countries for 3 diagnostic technologies: computed tomography (CT), magnetic resonance imaging (MRI) and positron emission tomography (PET).

Whilst these technologies have an important function in medical diagnosis, it is important to note that there is no general international benchmark for the ideal number of CT scanners, MRI units or PET scanners relative to the size of the population.

The UK’s count of diagnostic technologies per million population have been presented alongside data for 15 comparator countries (the same 15 used in the ‘uptake of medicines’ metric, see the section on uptake). Comparisons are drawn between countries based on their 2021 data (or nearest year, if 2021 data is not available).

For some countries, only data relating to equipment and exams within a hospital setting are available. For more information on the coverage of data used for each country, please see the ‘Notes’ page of the accompanying spreadsheet, and for more general information on OECD methodology for this dataset please see:

• OECD ‘Health Care Resources Sources and Methods’, and
• OECD ‘Health Care Utilisation Sources and Methods’

Employment in pharmaceutical and medical technology manufacturing

Changes from previous reports

OECD data on economic activity has been used to replace Eurostat as the data source for the pharmaceutical manufacturing employment metric for the 2024 LSCIs publication. This change has been made due to the UK no longer being a part of Eurostat’s data collection process, meaning that this data source is no longer appropriate for comparisons for the UK.

The new OECD data source does not report on data at a sufficient level of granularity to be able to extract data on medical technology manufacturing employment, which means that the medical technology metric is not available for this publication. OLS will continue to look for other suitable sources for internationally comparable data on medical technology employment.

The selection of comparator countries has remained the same as in previous publications despite the change in data source.

Data source

For the 2024 LSCIs publication, pharmaceutical manufacturing is extracted from OECD’s Data Explorer for the metric ‘Annual employment by detailed economic activity, domestic concept’ for the economic activity ‘manufacture of basic pharmaceutical products and pharmaceutical preparations’. All past data has been backdated from this source.

Data from OECD classifies companies by the Standard Industrial Classification of All Economic Activities (ISIC revision 4) and the pharmaceutical manufacturing employment used in this report selects companies categorised as ‘Manufacture of pharmaceuticals, medicinal chemical and botanical products’.

Methodology

The ISIC revision is a statistical classification of economic activities based on a set of internationally agreed concepts, definitions, principles and classification rules. The UK’s classification of economic activities is the Standard Industrial Classification (SIC) which is identical to the ISIC revision 4 classifications down to the 4 digit level. The figures in this report only include employment in manufacturing for businesses classified under the above classifications.

Employment figures are assigned to countries based on the location of the producer unit in the OECD data. ’Employees’ are residents and non-residents employed by resident producer units, and ‘self-employed people’ are resident and non-resident self-employed people in resident producer units. The employment data presented in this publication represents ‘total employment’, which consists of both ‘employees’ and ‘self employed people’. These employment statistics are based on national accounting concepts, aligning workers to the industry in which their employer is allocated. For the UK, these differ to labour market statistics published by other parts of the ONS, which are compiled differently and using different sources.

Please note that some employment in pharmaceutical manufacturing may be captured within enterprises whose economic activity is classed under other categories (and therefore omitted from this data). The OLS uses a more comprehensive definition of the pharmaceutical sector within its definition of life sciences. Domestic figures for employment in the pharmaceutical sector as a whole, and in pharmaceutical manufacturing specifically, are presented within the ‘Bioscience and health technology sector statistics’ data. The data used in the LSCIs represents a more narrow definition of the pharmaceuticals sector, covering manufacturing only, to allow an internationally standardised comparison to other countries.

When only a domestic estimate is needed of employment in the pharmaceutical sector, it is recommended to refer to the Bioscience and health technology sector statistics. When an international comparison is needed, the data used within the LSCIs allows a standardised comparison of a subset of the pharmaceutical sector to benchmark the UK’s employment against other similar countries.

Pharmaceutical manufacturing GVA

Changes from previous reports

Metrics for manufacturing GVA in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Methodology

Data is extracted in national currency and chain linked volumes with a base year of 2015 from the OECD. Exchange rates are also extracted from the OECD and applied to the figures to get a standardised time series in GBP (£).

Figures for the UK are supplied to OECD from the ONS national accounts. The figures are based on output GVA and are not balanced to the income and expenditure measurements of GVA.

Please note that some pharmaceutical manufacturing GVA may be generated by enterprises whose economic activity is classed under categories other than ‘manufacture of basic pharmaceutical products and preparations’ (and therefore omitted from this data). The OLS uses a more comprehensive definition of the pharmaceutical sector within its definition of life sciences.

Export and imports of pharmaceutical and medical technology products

Changes from previous publications

The data source for the metrics on exports and imports of pharmaceutical and medical technology products has changed in this year’s publication. This data is now extracted from UN Comtrade instead of UNCTAD (the source used in previous years), meaning that it has been possible to obtain data using a more granular and comprehensive selection of commodities relating to the life sciences sector. The result of this change has been that coverage of the sector’s trade in goods has been improved, and the breadth of medical technology products in particular is now captured more fully. This has had minimal impact on the UK’s positioning compared to other countries.

Data source

Trade data is extracted from the UN Comtrade database using HS (harmonised system) codes associated with the life sciences sector.

Methodology

Data is extracted from UN Comtrade at a HS6 level using a set of codes (identified by the Department of Health and Social Care) for commodities related to healthcare.

For trade in pharmaceutical products, a total of 174 HS6 codes were used, covering commodities in the following groups:

• Vaccines
• Medicines
• Substances of human origin
• Pharmaceutical inputs
• Chemicals used primarily for medicinal/pharmaceutical purposes

For trade in medical technology products, a total of 79 HS6 codes were used, covering commodities in the following groups:

• Hospital and laboratory inputs
• Consumables
• PPE
• Medical equipment

Foreign direct investment (FDI)

Changes from previous publications

Metrics for FDI in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

The data source for the FDI data is fDi Markets.

Methodology

Inward Foreign Direct Investment (FDI) is an investment from a foreign investor into an enterprise in a different country. The entity then becomes an affiliate enterprise, which is either a subsidiary, branch, or an affiliate company of the parent company – the foreign investor. In practical terms, a foreign company can either set up a version of itself in the country, or can acquire/merge with an existing company.

fDi markets only collects data on ‘greenfield’ investments. These are investments in which a parent company (or the foreign investor) creates a subsidiary in a different country, building its operation from the ground up. As a result, the data in this report only includes situations where a foreign company has set up a new entity in the relevant country and doesn’t include mergers or acquisitions. The data does not include investment into an existing facility in another country, nor a foreign investor making equity investments in another country.

The value of FDI comes from capital expenditure collected from fDi Markets data. Some projects do not have a known value for capital expenditure, and this is estimated by fDi markets.

The data in this report is based on fDi Markets data available at the industry ‘Cluster’ level definition for life sciences, which includes projects in pharmaceuticals, biotechnology, medical devices as well as some projects in adjacent sectors such as healthcare, software and IT, business services and various other industries where fDI Markets has tagged these projects as life sciences.

This data uses the fDi Markets definition of ‘life sciences’ and as a result some projects included do not necessarily align with the definition of life sciences considered in the Office for Life Sciences official statistics on Bioscience and Health Technology Sector Statistics (BaHTSS). In 2021, there was a substantial investment into the UK that would be considered healthcare and outside of the scope of the BaHTSS definition of life sciences. Despite this, the fDi data provides a consistent definition across countries to allow for international comparisons.

fDI Markets records publicly available data on FDI projects, and therefore underrepresents global investment, but has been chosen as the best available independent data source for making international comparisons.

The Department for International Trade publishes statistics on inward investment results 2021 to 2022 for the UK and are a better representation of investment coming into the UK, showing annual results for inward investments for life sciences.

Initial public offerings (IPO)

Changes from previous publications

Metrics for IPOs in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

Data is extracted from S&P Capital IQ.

Methodology

An initial public offering (IPO) describes the act of a company offering their stock on a public stock exchange for the first time. An IPO allows a company to raise capital from public investors.

The IPOs assigned to each country in this analysis refer to the country in which the IPO took place, not the domicile of the company being listed.

Data has been extracted by filtering for the following industry classifications to filter for IPOs in life sciences:

• health care equipment and supplies (primary) or
• pharmaceuticals, biotechnology and life sciences (primary) or
• health care technology (primary)

IPOs belonging to the above categories were extracted if their transaction status was marked as ‘Closed’ or ‘Successful’, and the date the transaction was closed was between 1 January 2010 and 31 December 2021.

The data in this report includes companies that have previously listed on one country’s stock exchange and then relisting on another country’s. Both the initial offering and the relisting are included in these figures if in the referenced time series.

Equity finance raised

Changes from previous publications

Metrics for equity finance in the LSCIs 2024 report remain the same as in the LSCIs 2023 report.

Data source

Data is extracted from S&P Capital IQ.

Methodology

Industry investment in this report refers to the amount of equity capital raised by the sale of shares from life sciences companies. This is the amount of capital that private and publicly-listed companies have raised through the issuance of new equity, and has been publicly disclosed.

IPOs are a form of equity financing and as a result the figures for IPOs are a subset of the total equity investment figures. The FDI figures in this report are not captured within the industry investment figures as the FDI data in this report does not include equity investments in another country.

Data has been extracted by filtering for the following industry classifications to identify life sciences investment:

• health care equipment and supplies (primary) or
• pharmaceuticals, biotechnology and life sciences (primary) or
• health care technology (primary)

Transactions included for the LSCIs are those defined in Capital IQ as:

• ‘private placement’ or ‘public offerings’ except those classed ‘Public Offering – Fixed Income Offering’
• transactions where the status was ‘closed’ or ‘successful’

The data includes public and private capital raises but this will not include all private investments. In some situations the value of private investments is only known by the company and the investors, as private companies are not obliged to report capital raises.

Skills

Changes from previous publications

Metrics for skills in the LSCIs 2024 report have remained the same since the LSCIs 2023 publication.

Data source

The data source for the graduates metric is UNESCO Institute for Statistics (UIS). The dataset where the data is extracted can be found within the ‘Education’ theme, and is named ‘Percentage of graduates by field of education (tertiary education)’. The programme of study is filtered for ‘Natural Sciences, Mathematics and Statistics’.

The UK apprenticeships data comes from a Department for Education statistics publication on apprenticeships and traineeships. To reach the total number of life sciences apprenticeships started, the following apprenticeship types have been summed together:

• science manufacturing process operative
• laboratory technicians
• science manufacturing technician
• science industry maintenance technician
• laboratory scientist
• technician scientist
• science industry process and plant engineer
• clinical trials specialist
• research scientist
• bioinformatics scientist
• regulatory affairs specialist