MSD scraps £1bn UK expansion, shifts life sciences research to US
Company cites insufficient UK investment and undervaluation of medicines; more than 100 jobs to be cut as government defends science funding
American pharmaceutical giant MSD said it has abandoned plans for a £1 billion expansion of its UK life sciences operations and will move research activity to the United States, citing a lack of sufficient investment in the sector and the “undervaluation of innovative medicines.” The company said the decision will lead to more than 100 job losses in the UK.
MSD, known as Merck in the United States, had begun construction on a site at London’s King’s Cross that was scheduled for completion in 2027 but said it no longer planned to occupy the space. The company also announced it will vacate its laboratories in the London Bioscience Innovation Centre and the Francis Crick Institute by the end of the year, a move it said will result in 125 job cuts.
A company spokesperson said the decision “reflects the challenges of the UK not making meaningful progress towards addressing the lack of investment in the life science industry and the overall undervaluation of innovative medicines and vaccines by successive UK Governments.” MSD did not provide a detailed timetable for the relocation of research operations to the United States.
A government spokesperson defended the record on science and research investment, but acknowledged more work remained to be done. “The UK has become the most attractive place to invest in the world, but we know there is more work to do,” the Department for Industry, Science and Technology said, pointing to recent commitments including up to £600 million for the Health Data Research Service alongside Wellcome and up to £520 million to the Life Sciences Innovative Manufacturing Fund.
The announcement marks the latest reversal by a major pharmaceutical company that had signalled large-scale investment in the UK. Earlier this year AstraZeneca cancelled plans to spend £450 million expanding a vaccine manufacturing plant in Merseyside, citing reduced government support. Executives at other drugmakers have warned that the UK’s market has become less competitive, affecting drug launches and access to new treatments.
Industry sources said there had been strong private investment in the King’s Cross area, which has become a hub for firms working at the intersection of life sciences and artificial intelligence. Those sources pushed back on suggestions that the MSD decision was directly tied to current UK negotiations over drug pricing, noting that the existing pricing regime was agreed in 2023.
U.S. policy developments have also influenced global pharmaceutical investment patterns. Since last year, companies have faced pressure from the administration of President Donald Trump to lower drug prices for American consumers and to increase domestic investment, including public discussion of steep tariffs on drug imports. In May, Mr. Trump signed an executive order aimed at reducing drug prices in the United States, and in August he suggested tariffs on pharmaceuticals could reach as high as 250 percent.
Dr. David Roblin, chief executive of London-based biotechnology company Relation Therapeutics, said the academic and research environment that initially attracted MSD to the UK remains strong. He pointed to the UK Biobank and the NHS as important research platforms, but said political shifts in the U.S. have altered where multinational firms choose to concentrate investment, because the American market is the largest in the world.
The Government said it recognised the news would be concerning for MSD employees and that it stood ready to support those affected. MSD’s move will add to questions about the UK’s attractiveness to life sciences investors as officials seek to implement a life sciences sector plan intended to drive growth and secure private investment.
The company’s decision will be watched closely by other firms and policymakers, given the role of multinational research centres in employment, innovation and the commercialisation of new medicines. MSD did not provide a full breakdown of the positions that will be cut beyond confirming the 125 job losses tied to the laboratory closures.
MSD’s exit from the planned King’s Cross facility and the withdrawal from London research sites comes amid wider industry debate over pricing, market access and government incentives for pharmaceutical R&D. The company’s announcement adds to a series of recent developments in the sector that have prompted renewed scrutiny of how the UK competes for global life sciences investment.