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Life Sciences Sector

– in the Scottish Parliament on 9th January 2019.

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Photo of Christine Grahame Christine Grahame Scottish National Party

The next item of business is a debate on motion S5M-15261, in the name of Ivan McKee, on recognising the life sciences sector in Scotland. I call Ivan McKee to speak to and move the motion. Minister—you have 12 minutes, or thereabouts.

Photo of Ivan McKee Ivan McKee Scottish National Party

Next month marks the second anniversary of the publication of “Life Sciences Strategy for Scotland 2025 Vision”. I am delighted to have life sciences included in my portfolio. Not only is the sector extremely important to trade, investment and innovation, but it is a key part of Scotland’s economy. I am glad to have secured the debate and to have the opportunity to update Parliament on progress in those key areas and more broadly across the sector.

The life sciences sector strategy has been developed by the industry in collaboration with academia and Government, through the life sciences Scotland industry leadership group. The aims of the strategy are to grow the sector, to create an environment to enable companies to access new markets, and to make sure that Scotland remains a location of choice for business investment and research in the sector.

The strategy is clear and focused. Its four strands cover the following: innovation and commercialisation, through leveraging our academic excellence and growing the entrepreneurial mindset in the sector; sustainable production, through building manufacturing excellence and enabling reshoring; internationalisation, through driving up inward investment and boosting exports; and the business environment, through ensuring, in particular, the supply of skills and finance that the sector needs in order to grow and flourish.

The evidence shows that the strategy is making a difference. Latest figures show that the sector’s turnover was almost £5.2 billion in 2016, which was a 39 per cent increase over five years. We are well on course to hit the industry target of £8 billion by 2025. Gross value added for the sector was £2.4 billion in 2016, which was a 27 per cent increase in a single year.

The sector is the largest contributor to Scotland’s business research and development investment. The 2017 figure reached £293 million, which is almost a quarter of the total for the whole Scottish economy. The sector boasts R and D spend of more than £17,000 per job, which is 36 times the Scottish average. The life sciences sector’s reported exports were £1.2 billion in 2016. They form a key part of our plans to ramp up Scotland’s international trade through our export plan.

The sector now has more than 700 companies employing almost 40,000 people. Many of the jobs are high-value jobs, with median weekly full-time earnings in the sector of £723 in 2017, which is 32 per cent higher than the Scottish average.

It is a sector in which there are real growth opportunities. Recent data from Deloitte shows that global healthcare spending is projected to increase at an annual rate of 4.1 per cent over the period 2017 to 2021. That is an increase from the previous rate of 1.3 per cent over the 2012 to 2016 period. The ageing and growing population, the expansion of developing markets, advances in medical treatments and rising employment costs all drive health spending growth. More than that, the sector has the opportunity to benefit the lives of millions of people through innovations that increase health and literally save lives.

The life sciences cover much more than just human health, and Scotland is recognised internationally as a leading player in animal health, particularly in genetics, genomics, endemic diseases and parasitology. In agritech, the James Hutton Institute is developing and commercialising new smart energy and LED light systems for indoor growing of high-value crops.

Scotland’s historical place at the forefront of medical innovation is a matter of record. From the world-leading work of Joseph Lister, Alexander Fleming and Professor John Macleod, through to Dolly the sheep and the bionic hand, there are countless examples of innovations and of the academic excellence that underpins our life sciences sector.

The research work of our universities continues to lead the sector globally. The University of Dundee was ranked as the world’s most influential pharmaceutical research institution in 2016, according to the Clarivate Analytics report, “The Relentless Desire to Advance: The State of Innovation 2017”. The University of Edinburgh is the only other United Kingdom institution in that report’s top 10, which includes the likes of the Massachusetts Institute of Technology and the University of California at Berkeley. Glasgow is home to the new £15.8 million artificial intelligence health research centre, which will support research not just in Glasgow but in Aberdeen, St Andrews and Edinburgh, to enable joined-up academic and commercial technology development.

Six of our eight innovation centres support the sector, including the stratified medicine innovation centre at the University of Glasgow, centres for sensor technology, digital health and biotechnology at the University of Strathclyde, the aquaculture innovation centre at the University of Stirling, and the University of Edinburgh’s data lab. Between 2009 and 2015, Scotland created 170 life sciences start-ups and 60 university spin-out companies.

Since my appointment, I have had the pleasure of visiting more than a dozen life sciences businesses—large and small—around Scotland. They cover the wide breadth of subsectors in the industry, from high-tech start-ups in the incubator at the University of Dundee to established manufacturing businesses in Inverness and businesses that provide truly global clinical trial services from their base in Glasgow.

Brexit is a key concern of many businesses. That is a subject that I will return to in detail in my closing remarks.

Just this morning, I spent time with Ken Sutherland and his team at Canon Medical Research Europe Ltd here in Edinburgh. I was hugely impressed by the work that they are doing on software development and artificial intelligence. One of the issues that I discussed at Canon was skills. The life sciences community employs a significant number of people in Scotland and creates high-value and highly skilled employment opportunities for school leavers, graduates and experienced personnel from around Scotland and beyond. That is why the skills agenda is at the heart of our life sciences strategy, with skills investment plans and leadership master-classes for the life and chemical sciences sectors. Availability of skills and talent has a huge influence on where businesses choose to locate.

Photo of Dean Lockhart Dean Lockhart Conservative

The minister mentioned the necessary skills for the sector. Does he agree with the Scottish Lifesciences Association that his Government’s policy of making Scotland the highest-taxed part of the UK will make it more difficult to recruit the necessary skills?

Photo of Ivan McKee Ivan McKee Scottish National Party

That issue has not been raised with me by any of the life sciences businesses—more than a dozen—that I have spoken to in the past six months. The issues that concern them are availability of skills for their sector and the damage that a hard Brexit will do to that, which I will come to later. As Dean Lockhart well knows, across the piece Scotland is the fairest-taxed and, for the vast majority of people, the lowest-taxed part of the UK.

Scotland has a highly skilled workforce, with the highest proportion of tertiary-educated graduates aged between 25 and 64 in the European Union. We have a fantastic pipeline of highly qualified individuals who are job ready for roles in the sector, and we are working hard to keep it that way. That is why we have committed to establishing a national retraining partnership together with unions and business, and to publish a future skills action plan.

Life sciences businesses have a key role to play in increasing Scotland’s exports, which is a huge focus of mine. Supported by £20 million-worth of investment over three years, our export plan will be published this spring. The plan will identify key sectors and markets on which to focus our efforts, and will provide support here in Scotland and in markets for businesses to position themselves in, in order to take advantage of international trade opportunities.

Attracting foreign direct investment is equally important to the sector. Last September, I visited BioCity Scotland Ltd in Newhouse to hear from life sciences companies that are continuing to expand in Scotland and are creating high-value jobs. It is vital that we continue to promote globally Scottish excellence in services, innovation, products and people. Scottish Development International has been successfully delivering in that respect for a number of years, and we are seeing the benefits of that work in record levels of inward investment, projects and jobs.

In October, my colleague Derek Mackay launched the “Invest in Scotland” capital investment portfolio, which includes investment opportunities such as the BioQuarter in Edinburgh and the advanced manufacturing innovation district Scotland in Renfrewshire. Through our innovation and investment hubs and the global network of SDI offices, we are working to deliver compelling messages to promote Scotland as a place of choice for investment. All six of my international trips since I took up my role have focused on targeting more life science businesses and persuading them to come to Scotland. Investors bring high-value jobs, new business opportunities and, crucially, the development of supply chains that reinforce our reputation as a fantastic place in which to invest.

Scotland’s national health service is a key partner in the development of our life sciences sector. There is the opportunity for the NHS to use the sector to bring advanced technology and innovative processes to the table, for example through the work of the Groupe SEB tech challenge, and to use the sector to operationalise innovative ideas from clinicians and others in the NHS, as is done by SHOW—Scotland’s health on the web—and through the health improvement partnerships, which benefit the sector and, importantly, improve patient care, with the potential to reduce costs and waiting times. Those are relationships that I value highly, so I work alongside my colleagues, the Cabinet Secretary for Health and Sport and the health ministers, to strengthen and develop them, while ensuring at all times that we prioritise the needs of patients.

I will comment on the amendments that have been lodged by the Opposition parties. The Government will accept the Labour amendment. We are always keen to work with trade unions—we recognise the value and perspectives that they bring to all our work with the economy. That extends to our partnership work to grow and develop the life sciences sector. The creation of high-value jobs is in everyone’s interests.

With regard to the Conservative amendment, I and the industry are keen that the time that we have today is focused on the sector—on its strengths and challenges; on the work that has been done and the work that we still have to do; and on collaboration with our partners in industry and our excellent academic institutions and other stakeholders, including trade unions, to drive the sector forward. The amemdment’s assertion that the Scottish Government will receive an extra £2 billion is unsubstantiated and, based on past performance and previous UK Government promises, is somewhat detached from reality. For that reason, we will not support the Conservative amendment.

The sector has gone from strength to strength in recent years and has bold, ambitious and achievable plans for the future. The sector strategy has been instrumental in focusing effort to deliver what has been achieved so far. We are only two years into the strategy and there has been real improvement in that short time. As co-chair of Life Sciences Scotland, it is encouraging to me to see that. I am excited for the sector’s future and look forward to working with the industry to develop its potential further.

I move,

That the Parliament recognises the importance of the life sciences sector to the Scottish economy; notes that February 2019 is the second anniversary of the publication of the industry-led Life Sciences Strategy; understands that the development of the strategy has seen the sector increase its turnover from £4 billion in 2015 to £5.2 billion in 2016 and that it is on track to meet its target to double sectoral turnover to £8 billion by 2025, and notes that this has been achieved through the strengthening of partnerships across industry, academia and with the NHS.

Photo of Dean Lockhart Dean Lockhart Conservative

Scotland has a long and distinguished history in life sciences: from Alexander Fleming discovering penicillin through to Sir James Black developing beta blockers, Scotland has led the world in the fields of medicine and biology.

Today, Scotland has one of the most dynamic life sciences sectors in Europe, employing more than 37,000 people across 700 organisations. Turnover in the sector exceeds £4 billion, contributing more than £2.4 billion of gross value added to the Scottish economy. Today’s debate is a good opportunity to recognise the efforts of everyone involved in the success of the sector and the collaboration that has been involved.

The Deputy Presiding Officer:

You have anticipated that he is poised to pounce.

Photo of Ivan McKee Ivan McKee Scottish National Party

I will update the stats: the turnover for the sector is now more than £5 billion.

Photo of Dean Lockhart Dean Lockhart Conservative

As I suggested, it is a fast-moving sector. That is good news.

One of the key strengths of the sector is its diversity. It is comprised of a wide range of multinationals, small and medium-sized enterprises and start-ups, and spans areas such as human healthcare, pharmaceuticals and biotechnology. However, it is important to realise that it is not just the private sector that is driving progress in the area. Key to the success has been the on-going partnership between the industry, universities and charities. Further, the NHS continues to play a critically important role in research and development and in delivering pioneering new treatments and global advances in medicine.

The critically important role that is played by the NHS will be further strengthened by the announcement this week by the Prime Minister of the UK Government’s long-term plan for the NHS, which will result in a £2 billion funding boost for the NHS in Scotland, as highlighted in our amendment. That extra funding will not only support front-line services but can be used to finance significant additional research and development in life sciences to support the future success of the sector. I must say that I am slightly disappointed that the SNP will not support our amendment and that it does not recognise the benefit that will come to Scotland as a result of the UK Government’s long-term plan.

With that background, it is clear that Scotland has a strong foundation for future success in the sector. The Scottish Government’s life sciences strategy is a welcome step in the right direction, and it identifies a number of opportunities. However, the reality is that more needs to be done to realise the enormous potential and ambition in the sector. By its own admission, the Scottish Government failed to meet its original target, set in 2011, to double the turnover in the life sciences sector to £6.2 billion by 2020. I understand that the timetable for that target has been extended to 2025.

Photo of Ivan McKee Ivan McKee Scottish National Party

Again, to correct the member’s numbers, the original aim was to increase the turnover from just over £3 billion, which it was in 2011, to £6.5 billion by 2020, as the member said. At the moment, we are at £5.2 billion. If we continue the 7 per cent annualised growth rate that we have seen over the past five years, we shall certainly exceed the original target and hit almost £7 billion by 2020. The target for 2025 is actually £8.5 billion, and, at the moment, we are on course to exceed that, as well.

The Deputy Presiding Officer:

There you go, Mr Lockhart. I was trying hard to follow that.

Photo of Dean Lockhart Dean Lockhart Conservative

I thank the minister for that intervention, but I believe that the original target that was set in 2011 was for £6.2 billion by 2020, and that we are still quite a way behind that. However, I recognise the progress that has been made and the contribution that is made by everyone in the sector.

I want to talk about some policy measures and actions that we believe the Scottish Government should be taking in addition to the life sciences strategy. First, the Scottish Government needs to actively engage in the UK industrial strategy and, in particular, in the UK life sciences sector deal. Having spoken to a number of companies in the past few days, I know that they realise the real opportunities that are available in the UK life sciences market and under the UK sector deal. The UK has the largest biotechnology cluster in the world outside the US; it is the fastest-growing market in Europe; it is worth more than £70 billion; and it employs more than 250,000 people across the UK.

Significant investments are coming through under the sector deal, including £500 million of UK Government support for research and more than £1 billion of new industry investment over the past couple of years. Funding under the UK sector deal includes the plan to increase total public sector R and D to £12.5 billion by 2021. For the avoidance of doubt, that is a UK-wide investment. There has been an investment of £85 million in the world-leading UK Biobank and the sector deal recently delivered an investment of £13 million in the UK medicines manufacturing innovation centre, which is based in Renfrewshire. It is clear that there are significant opportunities in the UK sector deal, which is why we encourage the minister and the Scottish Government to do more to ensure that everyone who is involved in the life sciences sector in Scotland can capitalise on those UK sector deal opportunities.

The second action that the Scottish Government can take to help the sector is to reduce the tax gap with the rest of the UK. I mentioned earlier that the Scottish Lifesciences Association has written to the First Minister to express its concerns about the policy of making Scotland the highest income-taxed part of the UK. The letter talks about the direct and indirect impact on recruitment of a situation in which the after-tax remuneration of recruits will be lower in Scotland that it is elsewhere in the UK. With stage 1 of the budget coming up in the next few weeks, ministers should listen to the warnings from people in the sector and reverse the policy of increasing the tax gap between Scotland and the rest of the UK.

Another issue that the industry has expressed concerns about is the growing shortage of science teachers in primary and secondary schools. We need to ensure that children get the education that they need for a career in life sciences. It is clear that an increasing science skills gap is emerging in schools, colleges and universities. Since 2008, the number of secondary school science teachers has declined by 15 per cent and there is a record number of vacancies for such teachers. We need to address that underinvestment and the science skills gap.

The minister referred in his opening remarks to the impact of Brexit. We recognise the potential impact of a no-deal Brexit. One simple thing that the minister can do is encourage his colleagues at Westminster to support the Brexit deal that the Prime Minister has negotiated. The deal, which is supported by all major business organisations in Scotland, will provide stability and certainty for businesses by keeping the UK in the customs union until we reach a free-trade agreement. That is why I ask the minister to encourage his colleagues at Westminster to support the Prime Minister’s deal.

We have outlined a series of policy measures that the Scottish Government can take to further advance the life sciences sector in Scotland, all of which are within the SNP’s control. I look forward to hearing in the minister’s closing remarks which of those necessary actions and policy measures he will take to realise the potential and ambitions of this vital sector for Scotland.

I move amendment S5M-15261.1, to insert at end:

“; recognises the importance of the UK-wide domestic market to the life sciences sector in Scotland; notes the announcement that the UK Medicines Manufacturing Innovation Centre will be based in Renfrewshire and will receive £13 million from the UK Government’s Industrial Strategy Fund; further notes that the life sciences sector is a key pillar of the UK Government’s Industrial Strategy, and welcomes the announcement of the UK Government’s long-term plan for the NHS, which will result in a £2 billion funding boost for the Scottish Government.”

The Deputy Presiding Officer:

When members take interventions, I can give them extra time, because we have a little time in hand.

Photo of Richard Leonard Richard Leonard Labour

I am pleased to open the debate on behalf of the Scottish Labour Party. There is little doubt about the vast economic contribution that the life sciences industry makes to the Scottish economy. Just this morning, Rhoda Grant and I visited the world-renowned Roslin institute, which is a world leader in life sciences research and development. The visit reminded me of a number of important lessons: that it is and always should be the primary goal of public research and development to solve wider societal and technological problems; that such research should be international in outlook; that it must be long term and not just short term in its horizons; and that it should never simply be reduced to commercialisation and the price of economics alone. At its best, the right combination of good science, the best brains—of women as well as men—in the science, technology, engineering and mathematics, or STEM, areas and innovative public investment can pave the way for wider social as well as economic benefit.

We were also struck by just how enormous the potential is for continued significant economic and employment growth in life sciences in Scotland. Institutes such as the Roslin are giving a lead in this important scientific revolution of our age and are already creating valuable and innovative business spin-offs and good-quality jobs. However, we need to get the design of the commercialisation pipeline right—it cannot be left to chance or the invisible hand of the market. We need a planned approach instead of a purely market-driven approach to economic development. We need an industrial strategy that is led not just by the United Kingdom Government but by a Scottish Government with vision if we are to win the jobs benefit here and not to see the re-emergence of the all-too-familiar pattern of research here, development there and full production and commercial gain overseas.

If Scotland is to continue to compete on a global scale in the sector, it is absolutely essential, particularly for small and medium-sized enterprises, that we have continued access to the expertise, intelligence, people and markets that have fuelled that rapid growth in Scotland over the past 20 years. In other words, failure to secure a trade deal with the EU could result in a risk to medicines and clinical trials, which in turn would have a negative impact on investment and employment and would put at risk the ability of our universities to conduct pioneering research in Scotland.

However, it is not just research that is at risk; it is also public health and safety and the processes and practices that protect consumers under current EU law. For example, genetically modified food and plants currently need to pass safety checks before they are used in the European Union, which is a point that was reinforced in last year’s ruling by the European Court of Justice on synthetic biology—or GMO 2.0. That point is important to consumers, which is why all those safety checks, authorisations and processes, including labelling, must be mirrored and continued post-Brexit.

Labour’s amendment to the Scottish Government’s motion highlights the important role of trade unions as part of future work across the life sciences sector and as part of a wider industrial strategy. We must face up to the fact that some major corporations in Scotland’s life sciences industry have, at times, obstructed their workers’ pursuit of the fundamental human right to trade union membership and organisation. Best practice in industrial relations should be a prerequisite for companies that wish to be considered for public contracts and Government funding, including NHS funding.

Scottish Labour’s industrial strategy sets out how we would drive up productivity, including through investment in science research and collaboration and in education and skills. We would do that by setting up new strategic sectoral forums that cover strategically important sectors, including the life sciences. Such a forum would bring together private companies, universities, Government, trade unions and other stakeholders, because, in the end, only by working together will we improve productivity, target procurement, direct investment, boost competitiveness, drive up skills and deliver apprenticeships and good jobs. We need to inspire the next generation of Scottish scientists, researchers and innovators.

Photo of Ivan McKee Ivan McKee Scottish National Party

Will Richard Leonard clarify the difference between the forums that he is talking about and the current industry leadership group?

Photo of Richard Leonard Richard Leonard Labour

The difference between the forums that we have set out and existing groups is that there would be much more involvement from trade unions, which currently do not have a big role to play. We would also like there to be a bigger role for the public sector in the groups. The Government’s strategy paper includes a foreword by the minister and by the vice president of GlaxoSmithKline, so we would like there to be more of a public sector steer on the work of the forums.

We also want to remove the barriers to young people—particularly young women and girls, as I mentioned—getting involved in careers in the industry.

We need a strategic public sector intervention because, in the life sciences sector, above all others, we need to adopt the working assumption that the needs of all must count for more than the profits of the few. There must be a proper balance of interests between mega corporations and democratic accountability. We must put in place a new model for innovation that puts investment in long-term research and development before spending boosts to short-term share prices. If we do that, Parliament will serve well the people whom we are elected here to represent.

I move S5M-15261.2, to insert at end:

“, and believes that future work across the sector must be in partnership with trades unions, as part of a wider industrial strategy.”

Photo of Willie Rennie Willie Rennie Liberal Democrat

Listening to Richard Leonard, one would think that he is in favour of remaining in the European Union, given all the credit that he gives the EU for the progress that we have made in this country. It is disappointing that that is not the Labour Party’s policy.

There is a growing group of people in this country called “Bob”—bored of Brexit—but I am afraid that I will talk about Brexit this afternoon, despite the fact that the minister did not want to focus on it for the commendable reason that he wanted to focus on the sector. It is evident from the sector briefings that we have received for the debate that the life sciences sector will be directly affected by Brexit. The motions and amendments do not refer to the issue, but I will major on it this afternoon because the life sciences sector is deeply worried about what Brexit will do to it.

Other members have talked significantly about the ways in which life sciences have been a major success story for Scotland, but it is worth rehearsing some of the numbers. As the minister has said, the financial value of the sector rose from £4 billion in 2015 to £5.2 billion in 2016, with a target of £8 billion by 2025. It is also worth rehearsing some of the distinct advantages that the sector brings to Scotland, such as patient identification from cradle to grave; strong collaboration involving the NHS, academia, Government and industry; globally competitive trial, recruitment and start-up times; a biobank resource that is unrivalled in Europe; and globally recognised electronic health systems. We are also home to the world’s top medical schools, with a focus on translational medicine; we have phase I, II and III clinical trials, post-market surveillance, biostatistics, regulatory compliance and data management and study monitoring; and we have fast performance turnaround times of three weeks for commercial projects and just under two weeks for non-commercial projects. That is quite remarkable. It is no surprise that there is so much interest in the sector in Scotland and that it is growing so much.

We have the £56 million UK medicines manufacturing innovation centre in Renfrewshire, which will revolutionise how medicines are manufactured and speed up the process of bringing new drugs to market. I also highlight the biocluster sites in Scotland, which include the Edinburgh BioQuarter, BioCity, the drug discovery unit in Dundee, the Inverness campus and Queen Elizabeth university hospital. In addition, we have innovation centres covering stratified medicine, sensors, digital health, industrial biotechnology and aquaculture. Why on earth, then, are we undermining this growing sector with Brexit? As we have seen from the briefings that we have received this afternoon, Brexit will undermine a global and outward-looking sector that is connected to the rest of the world and to Europe. Why on earth are we pursuing a Brexit process that will undermine all of that?

The life sciences sector relies on being able to access the best staff across Europe and the world and on the smooth and easy transfer of life-science-related supplies and human biological species, so erecting any barriers between this country and Europe with regard to people and materials will damage its prospects. As we have seen, the uncertainty alone is causing damage; it is leading to hesitation in investment and workers thinking about whether they want to come and work in this country. The sector is already working across the globe, but that is partly because we are in the European Union, working in partnership and taking an outward-looking approach. Anything that undermines that approach will diminish the sector. The best people come to work here partly because our country is in the European Union, and Brexit has put in their minds a question mark over whether this is a location that will continue to grow and thrive.

At the Beatson in Glasgow, for example, 70 per cent of the research assistants are non-UK citizens. People of more than 30 nationalities work there, half of the graduate students and 45 per cent of the postdoctoral students come from Europe and not a single junior group leader is British. The Beatson is an international institution that is proudly housed in Glasgow because we are an outward-looking country that works in partnership with the European Union and has not decided to pull up the drawbridge and do things by itself. Our success comes from all of that, so why on earth are we putting doubts into the minds of all those workers at the Beatson and at all the other centres that I have mentioned in Inverness and Dundee, at the Queen Elizabeth university hospital in Glasgow, at the Edinburgh BioQuarter and at the BioCity? Why are we putting doubts into their minds with Brexit?

The IQVIA and Q2 Solutions briefing is blunt. It is Scotland’s largest life sciences employer, and it says:

“In the event of a no-deal Brexit, the availability of investigational medicines and equipment used in our globally sponsored ongoing clinical trials ... could be disrupted.”

It also says that

“UK clinical research in the UK will be at a medium-term risk” and that

“it is crucial ... that both tariff and non-tariff barriers are avoided.”

The mutual recognition between the UK and the European Medicines Agency is essential. However, it is just one of the agreements that will be required. We will need a host of agreements right across the board. It looks as though we are trying recreate the European Union. Why on earth are we trying to recreate the European Union? Because it is of so much value. Why are we causing all this uncertainty? Why are we causing all this doubt in people’s minds? Why on earth are we pursuing this Brexit? Let us support the life sciences sector—let us reject Brexit.

Photo of Ruth Maguire Ruth Maguire Scottish National Party

With more than 700 life sciences organisations employing more than 37,000 people in high-quality jobs, Scotland is one of the largest life sciences clusters in Europe. The importance of the sector to Scotland as a whole is clear, and I welcome our SNP Government’s continued commitment to growing the industry. The most recent programme for government sets out an ambitious package of measures to promote the life sciences sector’s research institutions, international reputation and potential for significant growth and the creation of high-value jobs that goes with that.

The Fraser of Allander institute report “The economic contribution of the pharmaceutical industry in Scotland” states that,

“for every 100 FTE employees working in the wider pharmaceutical sector, an additional 240 jobs are supported elsewhere in the Scottish economy.”

The industry is also a key employer in towns and more rural communities outside the major cities. My Cunninghame South constituency is home to two well-established companies, Merck and GlaxoSmithKline, which contribute to our local and national economies both through the spending of wages and salaries and through complex supply chains.

Merck describes Scotland as “a powerhouse” for its business and the Irvine site as a key contributor to its Scottish success. The company’s Scottish sites, with more than 680 employees, supply the global pharmaceutical industry, biotechnology companies and the research institutes and academic centres of the world with the tools, chemicals, reagents and testing services that make scientific breakthrough possible. The Irvine site has been there since 1976 and manufactures critical components for some of the world’s highest-profile treatments. These are shipped to vaccine and pharmaceutical companies across the world. More than 170 highly skilled employees produce liquid and powder cell culture media and reagents that are used in biomedical research and production globally.

The Irvine site has recently expanded and there has been investment in the area. My most recent visit was to the life sciences cell culture media plant, where I was accompanied by students from Irvine royal academy and staff from across Merck’s Scottish sites. We were there to see the performance materials smart house. The smart house is a 24m2 pod that features cutting-edge technologies that have been created by the Merck life sciences experts. It includes everything from organic solar cells on the outside windows, which generate electricity, to intelligent lighting systems made from LED products that alter automatically when natural light changes and a television so thin that it can be curved without breaking. It was enormous, and many of us coveted it because it would be ideal for watching the football on with friends round.

Merck says that the smart house was created to help everyone to understand how the life sciences industry will change how we live in the coming decades. For me, though, the real value was in seeing how it could engage people—particularly the young people who were with me—with science and technology. It is important that young men and women know that there are challenging, exciting and interesting work opportunities for them in our local community and that there are different routes into those jobs: university, college and modern apprenticeships.

Another significant employer in my constituency is GSK. It employs more than 1,000 people across its two Scottish sites, in Irvine and Montrose, and is critical to the medicines supply chain. GSK states that investment in our young people is one of its priorities, and that is illustrated through its apprenticeships, its STEM ambassador work with local schools and its sponsorship of BodyWorks at the Glasgow science centre.

In August, I took part in the “apprentice for the day” challenge and had the chance to spend time with some young people at the GSK plant in Irvine. During my visit, I had the pleasure of meeting Shannon, who had just started to train as an apprentice, and Matthew, who had recently completed his training and now works full time for the firm. Shannon noted that she had always wanted to do something practical on leaving school and that her apprenticeship provides her with the perfect opportunity to learn a range of skills in the trade. Matthew added that the chance to experience different roles in the organisation through his apprenticeship had helped to make him work ready on its completion.

More recently, I was honoured to present the GSK apprentice of the year award. The Irvine site has apprentices across four key disciplines: engineering; manufacturing; environment, health and safety adviser; and supply chain. The overall winner was an engineering apprentice, Rachel McGivern, who was awarded first place by her peers and leaders for her proactive approach and her impressive analytical and practical skills; for completing her Scottish vocational qualification ahead of schedule and with excellent grades; and for contributing positively to the site as a whole. Rachel undoubtedly has a great career in engineering ahead of her.

The life sciences sector is important for the Ayrshire economy—there are opportunities there for our young people—and to Scotland’s economy. I welcome the Scottish Government’s continued investment in this important sector and look forward to Scotland’s continued success as a powerhouse in life sciences.

Photo of Gordon Lindhurst Gordon Lindhurst Conservative

The life sciences sector is an area in which the reputation of Scotland and the UK spans the globe. Much of that is down to the famous sheep Dolly, which was, of course, cloned at the University of Edinburgh’s Roslin institute.

Twenty years on, the Lothian region, which I represent, goes from strength to strength in the field of life sciences. It benefits from

, among other initiatives, the

UK Government and the Scottish Government working together on the Edinburgh and south-east city region deal. Investment is brought to projects such as the Roslin institute to bring together life scientists, clinicians and data scientists to develop innovative and financially sustainable models of health and social care that improve lives.

It is not just our universities that make the Lothian region such an important place for the sector. Earlier today, I met the director of IQVIA, which is Scotland’s biggest life sciences employer. It is a global data human sciences company with a laboratory in Livingston that processes 4 million biological samples from clinical trials across the world each year. Investment at that laboratory will also allow pharmaceutical and biotech companies from around the world to understand better how genes affect people’s health and risk of disease so that personalised medicines can be created. The company decided to base some operations in Livingston because of the rich life sciences ecosystem that exists here.

Indeed, the UK health and life sciences sector is, as we have heard, the fastest growing in Europe. It is important that Governments work together across the UK to maintain and grow that reputation as well as attract inward investment from across the world.

Scotland can benefit from initiatives such as the life sciences sector deals as part of the industrial strategy, which are fundamental to supporting the sector and boosting R and D funding to £12.5 billion by 2021-22, as well as funding from the industrial strategy challenge fund and Scottish Enterprise that will be used for one of the new UK medicines manufacturing innovation centres to be based in Renfrewshire.

Photo of Ivan McKee Ivan McKee Scottish National Party

Is the business that Gordon Lindhurst visited today the same one that produced the document that I have in my hand, which highlights in graphic detail the extreme damage that Brexit will cause to the sector?

Photo of Gordon Lindhurst Gordon Lindhurst Conservative

It is the same business, but what that document says is, of course, quite nuanced and fairly carefully worded. Like other businesses and other people involved in the sector, that business would be surprised by the minister and the Scottish Government not supporting Dean Lockhart’s amendment, which encourages the Scottish Government and the UK Government to look towards a positive working relationship together.

To return to what I was talking about, that centre will support small and multinational companies to manufacture medicines for a global market that is said to be worth around £98 billion. On the interesting point raised by the minister, one should bear in mind that we export more products to the EU than the EU exports to us, so it is in the interests of both the European Union and the United Kingdom to come to agreement in terms of looking to the future and going forward post-Brexit. That is really what we on the Conservative benches want to do; we want to work towards a positive future.

Fundamental to the sector and to the stakeholders involved in it is, of course, their relationship with the NHS and the opportunities that can be provided for improving care pathways and patient services as a result. The UK Government has invested in the long-term future of the NHS, with consequent benefits for the Scottish Government’s budget, which is a welcome step that will be of benefit to the life sciences sector and the health of our nation. As I have said, building and maintaining those relationships is important not just within the domestic market, but internationally too.

As the life sciences strategy for Scotland highlights, having such a good international reputation as its foundation means that Scottish companies and organisations can utilise the networks that they already have, which are worldwide and not simply restricted to that small part of the world that we are in, in the EU, to develop further their international mindset. Government has a role to play here, of course, in helping and encouraging the sector to think globally as well as in promoting the life sciences sector in Scotland as somewhere to invest through the likes of Scottish Development International. However, as we reach out to other parts of the world, we must ensure that the investment opportunities that are available to us already are being used to their fullest extent.

The Economy, Energy and Fair Work Committee found that that has not always been the case. The specific item that I refer to is the issue of the investment of up to £10 million from Scottish Enterprise within a wider £200 million package. The committee found that only £500,000 of that money had been spent by Scottish Enterprise by the end of October 2018. Scottish Investment Bank director Kerry Sharp noted, in an attempt to encourage businesses to come forward, that the life sciences sector is an excellent fit for the programme. Although it is disappointing that such efforts have been slow to get going, I hope that the life sciences sector can now fully benefit from those investment opportunities and, equally, I hope that the minister would encourage them to do so. The life sciences sector in Scotland is one that we can be proud of, but there is much more that we can do.

Photo of Kenneth Gibson Kenneth Gibson Scottish National Party

As convener of the cross-party group in the Scottish Parliament on life sciences, I am pleased to participate in the debate and heartened to hear about the progress that has already been made towards meeting the ambitious targets set out in the 2017 “Life Sciences Strategy for Scotland 2025 Vision” to build on the existing strength of this vital and highly productive sector of our economy. The life sciences sector has not been immune to the impact of Brexit, and the process has put at risk both access to medicines and workforce planning. It is therefore more essential than ever that we continue the Government’s proactive approach to growth.

Scotland has a long and illustrious history of invention, discovery and innovation in the field of medicine, and today’s modern life sciences sector reflects that tradition. The excellent work of the life sciences Scotland industry leadership group, which has played a crucial role in strengthening collaboration between industry, academia and the public sector, has been supported by the reconvening of the CPG on life sciences. Since November 2017, the CPG has taken a proactive role in creating a forum for the sector to share its ambitions with the Parliament and foster better working relationships with colleagues across the sector. I thank Ivan McKee and his ministerial predecessor, Paul Wheelhouse, for attending CPG meetings and supporting the group since its inception; I also thank members who have participated in the group, such as Graham Simpson and Tom Mason.

In a little over a year, we have been successful in achieving our aim of identifying and discussing policy areas of particular relevance to Scottish life sciences, particularly those that support the delivery of the 2017 strategy. A specific focus has been looking at how to ensure that Scotland’s workforce has the skill set required to deliver the strategy, and there has been much discussion on how to address positively the challenge of bringing more women into the life sciences sector.

The impact of those efforts has been tangible. Last March, as a direct result of concerns raised during CPG discussions that not enough is being done to showcase Scotland as a destination for global pharmaceutical company investors, the Association of the British Pharmaceutical Industry, the medicines trade body, arranged a series of three international webinars. Those webinars looked at the joined-up network of life science departments in Scotland’s universities; opportunities to test ideas in medicines manufacturing through the forthcoming medicines manufacturing innovation centre, which is under development in Renfrewshire; and the unique data opportunities for Scotland when looking at the outcomes for patients from different treatments and clinical pathways. That has raised Scotland’s profile as a destination for investment, supporting the attract element of the anchor, build and attract mission that was outlined in the strategy.

Of course, a strategy can be effective only if it takes a holistic and well-rounded view, and that has been reflected in the breadth of discussions that have taken place at meetings of the cross-party group. Topics have ranged from collaborations in life sciences to the economic impact of the sector, women in STEM, waste, the single national formulary, diagnostics and beyond.

The most recent meeting of the group focused on data, because, as the strategy highlights, Scotland has an invaluable resource for the data-driven approach to healthcare of the future, with all patients in NHS Scotland having a unique identifier and an electronic health record. The publication of Scotland’s digital health and care strategy in April 2018 and the more recent report from the data scoping task force were both largely welcomed, particularly the aims of capturing medicines use for patients in all clinical settings and including medicines indication in all prescribing systems.

As convener of the cross-party group, I have let the Government know of people’s desire to see the delivery of the commitments in that strategy to join up data silos and acknowledge the link between the income for the NHS from properly governed access to anonymised cohort-level data and the wider Scottish economy.

The group is seeking an update on the Government’s response to the report of the data scoping task force that, in September, called on the NHS in Scotland to take forward the Montgomery recommendations on medicines by capturing medicines use for patients in all clinical settings, creating a national laboratory data resource, improving the recording of patient outcomes and creating a Scottish medicines intelligence unit, which the cabinet secretary might perhaps touch on in closing.

As we approach the two-year anniversary of the publication of the life sciences strategy, there is much to celebrate. Sector turnover has already increased from £4 billion in 2015 to £5.2 billion in 2016 and we are on track to meet our target to double sectoral turnover to £8 billion by 2025. That is good news for the Scottish economy, as the sector directly supports more than 5,130 jobs and every 100 of those jobs supports an additional 240 elsewhere in our economy, as Ruth Maguire pointed out.

In addition, the jobs that are created by this growth sector tend to be high value, with the median weekly full-time earnings standing at £723 in 2017, up 6.2 per cent on the year before, which was the largest increase in earnings among all the growth sectors and compares favourably with the Scottish average wage.

Not only has the Government been proactive in fostering the right business environment for the life sciences sector to thrive, but it has directly supported innovative and growing companies through its enterprise agencies. Just this week, Glasgow-based Collagen Solutions was awarded a grant of £1.54 million, which will cover more than a third of its expected R and D costs over the next four years. Supporting businesses such as Collagen Solutions, which is a leader in the development and manufacturing of biomaterials and regenerative medicines for the enhancement and extension of human life, is key to fulfilling the targets that are laid out in our ambitious strategy.

If members wish to engage with leaders of growing life sciences companies to further discuss Parliament’s role in realising the sector’s potential, I extend an invitation for them to attend the event that I will host on Wednesday 30 January, which jointly involves Scottish Enterprise and the life and chemical sciences industry leadership group. I am confident that by continuing its collaboration with industry, academia and the NHS, the Government will overcome sectoral challenges and the uncertainty of Brexit to develop a life sciences sector that is sustainable, innovative and competitive.

Photo of Iain Gray Iain Gray Labour

I think that we all agree on the importance of life sciences to Scotland and the sector’s historical importance, of which we have heard many examples, from James Black to Dolly the sheep and, of course, Alexander Fleming and the discovery of penicillin—although Mr Lockhart missed a trick in not pointing out that Fleming had to go to St Mary’s hospital in Paddington to work, which is where he made that discovery.

We have also heard, correctly, about the sector’s potential. The numbers demonstrate that. The minister has given us the correct number of £5.2 billion turnover in the life sciences sector now and some 40,000 people employed in as many as 800 different organisations and enterprises. That is very significant. Indeed, it is particularly significant for me as the MSP for East Lothian because, as the Scottish Government’s chief economic adviser’s briefing on the life sciences centre points out, East Lothian has the greatest density of employment in the life sciences sector of any local authority area in Scotland, with some 3.2 per cent of employment being in the sector, so I have a particular local interest in it.

However, we should not fool ourselves, because the competition in growing the industry is huge. I remember, as many as 17 years ago, when I was enterprise minister, going to Uppsala during a visit to Sweden and finding there an ancient, 15th century university, the oldest in Scandinavia, that also has a strong history in the life sciences. For example, Carl Linnaeus was a professor there when he did his work. What took me aback was finding that, in Uppsala, the whole city seemed to be not much more than an extension of the university and its attempt to build and grow a life sciences cluster, which included its own internationally renowned commercialisation model. It was clear to me then that many places in the world are competing for the laurels in life sciences that we hope to achieve here in Scotland.

This is not something that will happen by accident like when Alexander Fleming discovered penicillin. It will require a concerted effort, so the strategy is both necessary and welcome, as is the leadership of the industry leadership group. However, our effort has to be even stronger and more national if we are to achieve the leading international role that we crave.

Not so long ago, at a life sciences sector conference, Pete Downes, the recently retired principal of the University of Dundee, which is a key player in academia and life sciences, said:

“One third of business enterprise research and development spending in Scotland is in life sciences. The biggest threat to its continuing growth is parochialism driven by internal competition for limited resources. To remain competitive, the sector must operate as a Scotland-wide cluster with the confidence to build relationships nationally.”

At the same conference, Dave Tudor, the co-chair of the industry leadership group, gave the current level of collaboration across the Scottish life sciences community only five marks out of 10.

Richard Leonard is right to argue for a more planned and strategic approach. We need to broaden the strategic leadership of our approach to the life sciences in order to achieve the growth that we all want to see, and that means having the right investment pipeline. The minister talked about Touch Bionics. Back in 2002, when I was enterprise minister, I awarded Touch Bionics a small firms merit award for research and technology—SMART—funding, and it has gone from strength to strength, but it is now owned by Össur, which is an Icelandic company. That says to me that the pipeline for supporting companies as they grow might need some work.

We need to have the right people at every level in every discipline. Key skills in the life sciences sector as it grows include cutting-edge lab techniques and skills in data handling and artificial intelligence, both of which have been mentioned by members in their speeches. We need to be sure that we have the people with those skills coming through in order to see the sector grow, and that means going right back into our schools and ensuring that enough young people are pursuing studies and then careers in STEM. We have real problems there. We have falls not just in the numbers of science teachers but in the numbers of the science technicians who are so necessary for the practical science that leads to those lab techniques. In recent years, we have seen a 25 per cent drop in computer science teachers, who are exactly the teachers that we need to have teaching young people the necessary skills for the sectors of big data and artificial intelligence.

If we are to pull together in Scotland around a national goal or challenge to build the sector and be a world-leading nation in life sciences, perhaps we should think about having a different focus for the strategy, on something that seizes the imagination rather more than the minister’s 7 per cent annualised growth rate does. For example, we should be looking at multiple sclerosis, a disease with which Scotland has a particular problem, and trying to commit ourselves to support, over a reasonable period, people who are looking for a cure for the disease, or we could focus on motor neurone disease, on which significant research is taking place in Scotland.

Let us ensure that the life sciences sector does not just grow but seizes the imagination, and let us mobilise not just the people who are involved in the sector but the whole of Scotland, so that we can look forward to innovations that are equivalent to penicillin or Dolly the sheep, rather than always looking back and being pleased about what we did in the past.

Photo of Shona Robison Shona Robison Scottish National Party

As we have heard, Scotland has had the highest number of life sciences start-ups per capita in the UK. It is estimated that the sector in Scotland employs just under 40,000 people, and the sector accounts for 55 per cent of university funding. There is a lot to celebrate.

Investment in research and development shows that the life sciences are a key growth industry, which has rightly been identified by the Scottish Government in its economic strategy, in recognition of the sector’s high growth potential and capacity to boost productivity.

Dundee is one of the leading locations for life sciences, with around 20 per cent of Scotland’s life sciences companies based in and around the city. Employment in life sciences companies rose from 700 to 900 between 2009 and 2017 in Dundee city—an increase of 28.6 per cent, compared with an increase of 22.3 per cent at Scottish level for the same period

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Companies that are based in the city are expanding their operations, which will have a positive knock-on effect on employment in the city’s other businesses and industries. For example, as a result of the continued growth in life sciences, as well as the opening of the V&A, Dundee is experiencing a resurgence in the hospitality industry, with a wide variety of hospitality outlets opening.

The city offers a wide range of expertise from all over the world—indeed, from more than 60 countries—with international academics and leading life sciences companies working closely to turn research into drug discovery and environmental biotechnology into commercial enterprises. The sector is advancing the field of precision medicine, where the therapy is targeted to the individual patient.

Currently, there are around 20 core life sciences enterprises and a similar number of supporting organisations in Dundee. There are also, of course, the internationally renowned University of Dundee and Abertay University and, close by, there is the James Hutton Institute.

The total turnover of life sciences enterprises in Dundee city rose from £62.7 million in 2008 to £94.6 million in 2017—an increase of 51 per cent, compared with an increase at Scottish level of 15 per cent over the same period. The gross value added—the measure of the value of goods and services provided for life sciences enterprises in Dundee—rose from £28.4 million in 2008 to £51.3 million in 2016, which is an increase of 81 per cent.

However, the employment figures from the life sciences enterprises do not include the large input from institutions, including the University of Dundee, Abertay University and the James Hutton Institute, which employ a great number of scientists. It is estimated that the number of academic and support staff and research students at the University of Dundee alone has increased by an average of 5 per cent each year since 2001. The university has confirmed that it currently has 685 substantive staff in the sector.

One of the university’s leading professors in life sciences, Professor Mike Ferguson, received a knighthood in the new year’s honours list. Professor Ferguson is one of the UK’s most eminent life scientists. He helped to build the drug discovery unit in the university’s school of life sciences, which has attracted investment of more than £75 million.

As the minister said, the University of Dundee has world-class modern laboratory and technological facilities. In the QS world university rankings in 2017, Dundee was placed in the top five universities in the UK for biological sciences and was eighth in Europe. In the Clarivate Analytics 2017 state of innovation report, Dundee was ranked as the most influential scientific research institution in the world for pharmaceuticals in the period 2006 to 2016.

Essential to Dundee’s continued success as one of the key locations in the life sciences industry is the close relationship between the city’s universities, private companies and NHS Tayside. One example of the working relationship is the establishment of the academic health science partnership in Tayside, between NHS Tayside and the University of Dundee. The AHSP acts as a single point of contact for collaborations and strategic partnerships and to identify, support and develop new relationships and facilitate knowledge exchange and opportunities with both industry and major research funders.

However, continued investment is vital to maintain Dundee’s position as one of the leading life sciences hubs, ensuring highly skilled, high waged employment in the city. I am delighted that, as part of the Tay cities deal, £25 million of investment to grow the Tayside biomedical cluster was announced late last year. That investment will help to maintain the continued success of Dundee and surrounding areas as an attractive, world-leading centre of excellence and a sought-after biomedical location in the UK that will create jobs and boost the local economy.

However, with less than two months remaining, the industry remains unclear exactly how Brexit will affect legal and regulatory requirements for the life sciences industry in the UK and Europe, and is expressing huge concern about this uncertainty. Dundee has proven itself as a leading hub for life sciences, but with deep concerns being expressed by researchers and industry leaders as to how Brexit will affect research collaborations and development and the ability of companies in the UK to continue working with their continental partners, the UK Government urgently needs to provide that much-needed clarity to the life sciences sector, for Dundee’s sake and for Scotland’s. That needs to happen now.

Photo of Bill Bowman Bill Bowman Conservative

I welcome the opportunity to speak in this Scottish Government debate recognising the life sciences sector in Scotland. The life sciences sector can be defined as including human health, biology and biotechnology, and animal health. Scotland’s life sciences community is one of the largest in Europe.

Scotland is home to over 700 companies specialising in life sciences and is a global centre of research and development in key sectors, including digital healthcare, animal bioscience, regenerative medicine, industrial biotechnology, medical technology and pharmaceutical science. Scotland’s formidable legacy in life sciences includes, as we have already heard, Sir Alexander Fleming’s discovery of penicillin in the location mentioned by Iain Gray, Ian Donald’s utilisation of ultrasound for obstetrics and the Roslin Institute’s cloning of Dolly the sheep, the world’s first mammal cloned from an adult sheep cell.

The latest figures that I have show that the sector employs over 37,000 people across some 700 organisations, which add about £2.4 billion to the Scottish economy. Scotland is already a leading global life sciences cluster and in the past few years has seen many positive developments.

Scotland also has the highest number of life sciences start-ups per capita in the UK, while life sciences account for about 55 per cent of total Scottish university research funding. We also have the largest concentration of animal health and aquaculture researchers in Europe. In the UK, Scotland is second only to London in terms of life sciences companies receiving venture finance.

The 2017 “Life Sciences Strategy for Scotland 2025 Vision” aims to grow the industrial turnover of the life sciences sector to £8 billion, while also making Scotland the location of choice for the life sciences community. The strategy themes of the vision are innovation and commercialisation, sustainable production, internationalisation and business environment.

Life sciences is a key sector of the Scottish economy and we have one of the largest and fastest growing life sciences communities in Europe. The sector is particularly important to the region that I represent, North East Scotland, as it accounts for a large part of north-east Scotland’s economy with more than 2,500 people employed within its companies and research base.

The region accounts for more than one fifth of employment in Scottish life sciences research and development, and Aberdeen has one of the highest concentrations of life scientists in the UK outside of Cambridge. For example, Aberdeen’s health campus is Europe’s largest integrated medical, research and teaching location, and provides a collaborative environment for clinical, commercial and academic researchers.

There are numerous examples of the north-east and, in particular, Dundee, being leading areas in life sciences. A key regulator of cell growth and survival called protein kinase B, or PKB, is the focus of numerous anti-cancer drug clinical trials. The role of the protein and how it works was uncovered by researchers at the University of Dundee, and has stimulated pharmaceutical companies to undertake drug development campaigns focused on PKB as a target molecule. Moreover, the research has led several life sciences companies to generate research tools to accelerate academic and industry research in that area.

Another success in the life sciences sector originating from the University of Dundee was the pioneering automated drug-design methodologies developed by researchers there, which led in 2012 to the spin out of Exscientia Ltd, a leading British drugs design company. The company provides technologies to enhance the efficacy and the efficiency of drug discovery for the pharmaceutical industry using artificial intelligence.

As the life sciences sector continues to grow, the role of leadership in it has come increasingly to the fore. Research has isolated “five critical leadership” areas, which are believed to be the battleground of the corporate life sciences future. One of those is the “adaptive mind set”. That can be shown through the University of Dundee’s collaboration with Boehringer Ingelheim, a global, research-driven pharmaceutical company, to provide free access on public markets to proteolysis targeting chimeras, or PROTACs, which are compounds that are used to fight diseased cells.

I believe that the Scottish Government recognises the important role that the life sciences sector plays in improving Scotland’s economic performance and its potential for growth. However, more can be done, and the only way to grow the life sciences industry is to create a business-friendly environment that will attract talent and inward investment.

I encourage closer ties between the biosciences industry and Scotland’s universities to provide the necessary skills base in business and science for the sector to continue to prosper, duly supported by the Scottish Government.

Photo of Maureen Watt Maureen Watt Scottish National Party

I, too, am pleased to be taking part in this debate on such an important part of the Scottish economy. I recall that, in 2007, when I was a Government minister, there was much debate about how Scottish Enterprise would concentrate its efforts on particular sectors of the economy, to help growth in the economy overall. There was some criticism of that, but I think that we have seen the benefits of that, despite the severe impacts of the banking crisis, the UK being in its second decade of austerity, which is an economic choice by the Westminster Government, and, more recently—the next choice of this shambolic Westminster Government—Brexit. The choices made back then by this Scottish Government were correct.

It is to this SNP Government’s credit that the Scottish economy is performing so well in the face of such adverse events. We should never forget the significance of that. I have been around long enough to remember that, when there have been recessions in the past, Scotland has ended up being very badly hit. As they used to say, when England gets a cold, Scotland gets the flu. Those opponents of devolution and the further devolution of powers would do well to remember that.

In among all the external economic shocks to the Scottish economy, there has also been the most recent downturn in the oil and gas industry, which is probably longer and deeper than any previous ones. That has led leaders in the north-east, across business, local councils, higher and further education and the health sectors, to come together to see what can be done to encourage growth in other sectors, such as the food and drink and life sciences sectors. Opportunity North East was set up as a consequence.

The north-east has always had a very big footprint in the life sciences sector, through the Rowett institute and the James Hutton Institute, which used to be the Macaulay Land Use Research Institute. Their importance in many fields is well documented. In order to build on that, on 21 November last year, the bio-therapeutics hub for innovation was launched in Aberdeen specifically to drive health innovation and life sciences company growth. It is a £40 million project that is set to deliver an innovation hub to double the number of life sciences companies in the north-east of Scotland and support the national ambitions of the sector to collaborate, innovate and commercialise the next generation of therapies and healthcare solutions.

The hub will be a focal point for the sector’s ambition of growth. Some £20 million of capital funding has already been secured through the Aberdeen city deal. Opportunity North East itself has committed an additional £3.6 million over seven years to operate the hub and deliver the bespoke support activity that is designed to create one of the most dynamic environments and grow life sciences businesses. Brexit permitting, it will hopefully be a catalyst for international collaboration and investment.

It will be located on the Foresterhill health campus, a 69,000 square foot new-build facility, which will include accommodation for spin-outs, start-ups and established businesses, collaboration space and shared facilities for events, small conferences and networking. Sector-specific support programmes in the hub will include incubation, acceleration, mentoring, commercialisation and growth planning.

As Bill Bowman said, the Foresterhill campus is already one of Europe’s largest integrated clinical research, teaching and commercial health sites. This project, which has a delivery date of 2020, will only add to its importance and influence, which will make sure that the targets that the minister mentioned are met.

I am grateful to Sir Ian Wood, chair of Opportunity North East, for his role in that. I am also grateful to Professor Stephen Logan, chair of ONE’s life sciences sector board, who has driven this. He has just completed his term as chair of NHS Grampian and we should thank him for all that he did in that role—Shona Robison and I are very grateful for what he did in that role. Professor Logan said that the hub will

“realise the opportunity to collaborate and innovate to bring forward the next generation of medical therapies and products and our target is to double the size of the company base by 2027. This is a transformational project of national significance that supports the regional economic role of diversification and will contribute to the national ambitions of life sciences as a driver of health and wealth.”

Those are his words, not mine.

In welcoming the launch of the hub, the principal and vice-chancellor of the University of Aberdeen, Professor Boyne, said:

“Bringing academics, clinicians and industry together onto one site on the Foresterhill Health Campus is good news for patients and it will speed up the translation of research from bench to bedside and improve the diagnosis, management and treatment of disease.”

The University of Aberdeen already has an excellent track record of producing pioneering spin-outs tackling serious health concerns that include antibiotic resistance, autoimmune disease and gut health and Alzheimer’s disease. Indeed, in December, the Rowett institute announced a new Aberdeen-led study to look at the gut health of people with Alzheimer’s to see whether diet can play a role in managing the behavioural and psychological systems of the disease. There is increasing evidence that the gut microbiota are a key link between specific nutrients and brain function.

The study will recruit participants from local care homes. If successful, it could act as the first step towards establishing a link between diet and behaviour and could possibly lead to future research teasing out the complex relationship between diet, gut microbiota and challenging behaviour in Alzheimer’s disease. As the minister said, with an ageing population, that is precisely what our life sciences sector can do to grow.

Although I enjoyed the first part of Iain Gray’s speech, he cannot help being a glass-half-empty guy. At the previous members’ business debate on MND research, Kezia Dugdale praised MND research in Scotland and she said, if I remember correctly—

Photo of Linda Fabiani Linda Fabiani Scottish National Party

Excuse me, both of you. We are way over time, so please come to a conclusion, Mrs Watt.

Photo of Maureen Watt Maureen Watt Scottish National Party

For Iain Gray’s benefit, I will just note that Kezia Dugdale said that, if a cure were to be found, it would be either in Scotland, Australia or Israel.

Today’s debate has been useful in highlighting what is going on in Scotland’s life sciences sector.

The Deputy Presiding Officer:

We move to the closing speeches. I am glad to see that everybody is back in the chamber, courtesy of Mrs Watt being allowed to talk on for a while.

Photo of Rhoda Grant Rhoda Grant Labour

The debate has highlighted the potential of the life sciences sector, in which Scotland is a world leader. As Richard Leonard said, this morning we visited the Roslin institute, which is a world leader in agriculture, aquaculture and animal health. Not only is it a world leader in those areas, it spends time inspiring young people and encouraging businesses to grow in its area of expertise.

Iain Gray spoke about the contribution that the life sciences sector makes to the Scottish economy, as a £5.2 billion sector that employs 40,000 people. With the right strategy, we could grow that by Scottish companies bringing research and development to market. We need to do more to encourage that and create the conditions for it to happen—it will not happen by accident and we need a strategy to do it.

To grow the sector, we need to start by inspiring a new generation of scientists and removing the barriers that hold them back. Ruth Maguire talked about having different routes into the sector from colleges and schools. We need to encourage more girls to study STEM subjects, too. I first visited the Roslin institute some years ago when it was awarded the Athena SWAN award that recognised its commitment to women’s career development, which again came across strongly during this morning’s visit.

Today, we also saw the institute’s commitment to young people, as it has well-equipped labs for visits from schools—not only Scottish schools, but schools from across Europe and the rest of the world—whetting the interest of young people in STEM subjects.

Dean Lockhart and Iain Gray mentioned an issue for encouraging young people into STEM subjects, which is the lack of STEM subject teachers. Young people cannot be enthused if we do not have the teachers in place to achieve that. As mentioned in the debate, we need science teachers, lab technicians and computer science teachers if we are to encourage young people to get involved in STEM.

Richard Leonard said that Scottish Labour would set up strategic sectoral forums covering strategically important sectors, which would of course include life sciences. The forums would bring together employers, the Government, the public sector, trade unions and other stakeholders. They could work together to improve productivity in the sector and ensure that we invest, are competitive and deliver the right skills for the industry. The forums would feed into an industrial strategy that recognised the worth of life sciences to the Scottish economy and brought developments to market, keeping the benefit in Scotland.

Iain Gray talked about collaboration and how it is not working properly in Scotland. That would also be a job for the strategic sectoral forums, or for the life sciences Scotland group, which surely has a role in bringing together what is good in Scotland and making sure that people work together.

Our amendment talks about trade union involvement. The people who staff life sciences industries and businesses need to be involved in driving the sector forward, because they have the knowledge to do that. Richard Leonard made the point that some businesses do not have a good record of trade union recognition. We need to change that and make sure that public funding for research and development and for contracts addresses the issue, driving up standards and trade union involvement by using the tools that are at our disposal.

Shona Robison spoke about NHS Tayside’s work with the University of Dundee, and I will mention a part of that. A constituent of mine has been campaigning for magnetic resonance-guided focused ultrasound, which those organisations are working together to try to bring to Scotland. I have been in contact with the Scottish Government and I hope that the minister will look at the matter again, because it has seemed unable to help. That technology would be a huge step forward for Scotland; the only place where it is available is London, and it is important that we bring it to Scotland.

We have to work with other parts of the UK, as Dean Lockhart said. It is clear that UK-wide funding and collaboration are very important in the sector, but we also have to make sure that we do not fall behind. We need to continue to work together to be a world leader in life sciences. This morning, the Roslin institute spoke about a lot of its funding coming from the Biotechnology and Biological Sciences Research Council, which is a UK-wide organisation that the institute works closely with, as it does with other institutes throughout the UK. The Roslin institute sees that partnership as incredibly important to its future.

Iain Gray spoke about research and investment and how we should look for the cures for such things as MS and MND, and I sincerely hope that we will continue to aspire to do that.

Life sciences are an important part of our economy and we need to develop the sector and capitalise on research and development to ensure that Scottish companies are at the forefront of bringing that innovation to market. If the Scottish Government were to develop an industrial strategy, surely life sciences would be at the very heart of it, allowing those opportunities and that growth to happen in our country and in our industry.

Photo of Graham Simpson Graham Simpson Conservative

This has been an interesting debate, which has demonstrated that the life sciences sector is important to Scotland and the rest of the UK. I will close for the Conservatives this afternoon by speaking about my interest in the sector, highlighting contributions in the debate and asking questions of the Government.

As we have heard,

“The life sciences sector is an important contributor to Scotland's economy, providing more than 37,000 jobs across more than 700 life sciences organisations.”

That sentence comes from the Government’s life sciences strategy, and it is good that there is one.

My interest in the sector is personal: one of my daughters gained a masters degree in biochemistry at Glasgow and is now doing a PhD at Cambridge on a project about Parkinson’s disease. I ask members not to intervene here, because that is as much as I know or understand about it.

Despite my scientific shortcomings, I am the vice-convener of the Parliament’s cross-party group on life sciences. The group has met fascinating people who are doing amazing work and I have seen at first hand the impact that the sector has on our job market and economy.

We have a lot to be proud of in our life sciences sector. In my Central Scotland region is the Scottish universities environmental research centre in East Kilbride, which used to house a nuclear reactor—the Presiding Officer will know it well. Great work is going on there in conjunction with our higher education sector, but it is largely unsung and not known about.

The hub of research and innovation is at BioCity in North Lanarkshire, which is funded through the city deal. Based there is CuanTec, which is a stand-out small company that I find very exciting. As a result of its research, passion and dedication to creating food packaging from marine life by-products—shells—I hope that we will see its compostable food packaging in supermarkets soon.

Not only can that product reduce plastic waste, it can increase the shelf life of fresh food and reduce food waste. It is very positive. CuanTec is headed by Dr Cait Murray-Green. I mention that because one of the biggest mountains that the sector needs to climb is attracting more female talent. We need to inspire females at a young age and show them that—much like politics—science is not the male-dominated sector that it used to be and should not be. Dr Barbara Blaney at BioCity works hard to bring local schools into the site, and I hope that enabling people to see important and successful scientists in that environment will encourage growth in the numbers of female graduates.

We also need to attract talented children from disadvantaged backgrounds. That group is underrepresented in the sector.

Photo of Iain Gray Iain Gray Labour

Perhaps the member will allow me this opportunity to correct Maureen Watt’s misunderstanding of the point that I made at the end of my speech. If we want to inspire young women to enter this industry, we should be articulating the potential for things such as finding a cure for conditions such as MS or MND—work on which is already on-going—rather than simply talking about economic growth.

Photo of Graham Simpson Graham Simpson Conservative

I have to say to Mr Gray that I found his earlier contribution quite upbeat, in fact.

One way to support some aspiring young scientists would be to increase life sciences apprenticeships. On a recent visit to New College Lanarkshire, I was told that there are only 62 life sciences apprentices in the whole of Scotland. That is clearly not good enough. Apprenticeships are a fantastic way to train up the next generation of scientists. We need to build on the current networks between academia and industry in order to increase that number. One of my questions to the Government is what can be done about that. If the minister does not have an answer today, I urge him not to make one up but to go away and think it through.

There have been some excellent contributions to the debate today. I will just fly through them. Dean Lockhart spoke about the need for UK collaboration. He also mentioned the skills gap. Richard Leonard spoke of the need for a trade deal with the EU and called for more joint working. Willie Rennie mentioned somebody called Bob who is bored of Brexit, and then he banged on about Brexit. Ruth Maguire talked about jobs in her constituency and mentioned a smart house that she had visited—there is a smart house in my constituency, at South Lanarkshire College in East Kilbride. Gordon Lindhurst spoke about Governments working together. Kenny Gibson, who used to work in the sector, spoke about the work of the cross-party group that I mentioned and also addressed the issues of skills and getting women into science, which I have already touched on. The upbeat Iain Gray spoke about international competition and the lack of science teachers. Shona Robison and Bill Bowman both mentioned the life sciences sector in Dundee, which is doing very well. Maureen Watt appeared to forget what debate she was in before she turned to the issue of life sciences and talked about the north-east.

Why is the life sciences sector so successful? We have more than 700 companies operating here and the highest number of life sciences start-ups per capita in the UK. Those companies support more than 37,000 jobs in the sector.

I will stick to time, Presiding Officer—I know that you like that—by dropping a whole bit out of my speech.

Members:

Aw.

Photo of Graham Simpson Graham Simpson Conservative

I am really very sorry, but I took an intervention from Ian Gray.

The life sciences strategy sets an ambition to grow the sector by 7 per cent a year to reach a turnover of £8 billion by 2025. Is that ambitious enough? Forecast annual increases of 6 per cent in R and D spending by the pharmaceutical industry on its own could meet that target. That is one question that I would ask the Government, and I have a few more.

It costs staggering sums to bring a new medicine to market, but medicines keep people out of hospital. Is the Scottish Government serious about NHS Scotland being a partner in the delivery of the strategy? Where can we scrutinise the figures that illustrate that we are on course to meet the life sciences target? Do NHS boards still have a network of innovation champions, and what metrics are being used to allow the NHS to demonstrate its working?

I apologise for going over time, Presiding Officer. I will sit down.

The Deputy Presiding Officer:

Apologies are always welcome.

Photo of Ivan McKee Ivan McKee Scottish National Party

It has been an informative, interesting and at times entertaining debate. I apologise in advance in case I do not mention every contribution. A number of issues have been raised and I will try to touch on the most critical ones.

I first want to clear up some issues about the Scottish Government’s attitude to the UK Government and co-operation in the sector. I say clearly for the record that we are keen to work with the UK Government to secure funding. The industry leadership group recognises the huge value of the funding that is available through the industrial strategy, and I continue to advise organisations to put together collaborations and apply for money. Clearly, we have been successful, given the money that has come forward for the medicines manufacturing innovation centre and the significant money for the James Hutton Institute and for iCAIRD, the industrial centre for artificial intelligence research in digital diagnostics, which I mentioned. There are many other examples. In my brief six months in office, I have met Ian Campbell, the head of Innovate UK, on two occasions, and on both those occasions the conversation centred largely around the life sciences sector and what Scotland can get from UK Government opportunities in the sector.

I am on first-name terms with my UK Government counterpart, Lord Henley—Oliver—and we have met several times to talk about the co-operation. Indeed, Oliver was at the most recent ILG meeting. We do that not least because it is our money—Scotland pays her taxes, which go to Westminster, and the UK Government uses that money to fund all manner of things, including the industrial strategy. It is only right that we should get our fair share of it, and we continue to push for that.

Photo of Graham Simpson Graham Simpson Conservative

I am encouraged to hear that. Might the minister and his friend Oliver like to come together to the CPG on life sciences at some point?

Photo of Ivan McKee Ivan McKee Scottish National Party

The member will need to ask Oliver that question.

One important point is that I have written twice to the UK Government to ask for Scottish representation on the UK Life Sciences Council and the life sciences industrial strategy implementation board, but we have not been given that yet. If the member could add some weight to that appeal, that would be hugely beneficial and appreciated.

Labour members kept talking about the need for a strategy, but we have a strategy. Constructive comments about what else could be in the strategy would be welcome, but it is not helpful to continue to say in parrot fashion that we need a strategy when there is one in front of us. Richard Leonard mentioned two things that are wrong with the strategy. First, he said that it does not include the trade unions. I take that point on board, and I shall take that up as an action. Secondly, he said that it has a picture of Dave Tudor in it. Now that Dave has left the ILG to do something else, we could maybe take his picture out. I do not know whether that will make Richard Leonard happy and allow him to sign up to the strategy. It has been developed in a bottom-up way by the sector, which is a far more effective approach than one in which the Government sits in an ivory tower and pushes something down on to the sector. That is why the strategy works, is robust and is delivering results.

Photo of Richard Leonard Richard Leonard Labour

I am not calling for the displacement of industry; I am calling for a broader approach that includes the trade unions but is Government led because, in the end, individual companies will represent individual company interests, and there needs to be a broader view that is led by Government.

Photo of Ivan McKee Ivan McKee Scottish National Party

The member misunderstands the purpose of the ILG. The Government has a huge role to play in it. The agencies are all there, and it works in collaboration with industry from all parts of the sector, including small and big companies. If Richard Leonard had been to at least one of the meetings, he would understand that that collaboration works very strongly. The ILG includes the national health service, universities and many other relevant stakeholders.

Graham Simpson made some interesting points. I take on board the issue of gender balance, and we continue to push for that. I will investigate the point that he made about apprenticeships. I will be very surprised if the number that he gave is correct, given the tens of thousands of apprenticeships that the Government is supporting, but I will get back to him. I have commented on the issues with the NHS, and I will do so again, because that relationship is key to driving the sector forward.

I found Iain Gray’s speech extremely thoughtful and helpful. I recently visited Zurich and other cities in which life sciences are core to what they are doing. We should learn from such cities so that we can do our very best. It is great to hear Pete Downes talk about collaboration. Universities, because of their nature, can often be more competitive and collaborative. From my conversations with Pete Downes and Iain Gray, I know that they, and many others, clearly understand that universities working with other stakeholders is the way forward. There have been 170 start-ups in the sector over the six-year period to 2015 and, on top of that, there have been 60 university spin-outs. Therefore, we are continuing to fill the pipeline. Perhaps we could do better, but we have had some results.

Photo of Iain Gray Iain Gray Labour

I accept that. I was making the point that the pipeline needs to support medium-sized companies as they grow, as an alternative to the Government selling out to overseas investors.

Photo of Ivan McKee Ivan McKee Scottish National Party

There is always a balance between bringing in foreign direct investment, which is critical to the economy, and growing businesses as fast as we can through whatever investment is available. However, I take Iain Gray’s point on board.

I will move on to cover the important points that Willie Rennie made. I said that I would come back to Brexit and communicate the sector’s concerns about the impending developments. Although businesses across many sectors are concerned about the damage that Brexit will do, the life sciences sector stands to be particularly impacted. As well as skills shortages being exacerbated and complex international supply chains being disrupted, the risk of regulatory divergence is a particular concern for the life sciences sector. The close relationship between the sector and academia means that the risk to research funds, co-operation and the free flow of academic talent will significantly harm the sector.

Life sciences businesses never miss an opportunity to remind me of the damage that Brexit will do to their ability to trade. Yesterday, I met Merck, which expressed concerns about the risk to its supply chains, and, during my visit to Canon Medical Systems Ltd this morning, I found out that more than 30 per cent of the firm’s employees who are working on artificial intelligence are EU nationals. Such workers are highly skilled, highly mobile and critical to the business’s success in Scotland, and they are hugely concerned about their future.

In my opening speech, I highlighted Scotland’s long history in the life sciences, our long-standing and on-going global academic excellence in medical research and technology, the breadth and range of our life sciences businesses and the ambitious plans that the sector has for growth in turnover and exports. In November, I had the privilege of speaking at the largest ever Scottish life sciences conference. A community of hundreds of companies, academics and NHS representatives got together to consider the future of the sector and to celebrate what has been achieved through the development of a strong life sciences community in Scotland. Life sciences is one of the many sectors in which Scotland demonstrates true global excellence and the potential to continue to excel.

I have covered the challenges that face the sector. For those that are in our control, including those that relate to skills and investment, I have detailed the work that the Government is doing to support the sector. For the challenges on which we have to do our best to mitigate the misguided policies of others, such as the mistake of Brexit, I have made clear our determination, through working with my colleagues, the cabinet secretary and the minister for health, to maximise the contribution that our Scottish NHS can make to develop the sector. We will take all due care and attention to ensure that patient care is paramount and that data protection is sacrosanct. The two-way street enables our NHS to access the best technology and innovation and to apply them to the benefit of patients, which drives up safety and drives down waiting times and costs. The sector needs to be able to take the best innovations from our clinicians and other health service workers and to commercialise and apply them not just in Scotland but around the world, in order to benefit Scotland’s economy and jobs, our public sector finances and our patients.

The life sciences sector is more than just another industrial sector in Scotland’s range of world-class industries. The work that businesses do is truly life saving—it literally saves lives through innovation. The work makes us healthier and wealthier, which makes it such a key part of Scotland’s economic strategy. We are proud to be standing on the shoulders of giants—Lister, Fleming and, of course, Dolly the sheep. I am proud to be working with an excellent team in the industry leadership group and across the wider sector. I will continue to work with people to drive forward plans to grow the sector, to maximise its potential and to contribute to Scotland’s economy and wider society.