UK to invest £380m in Engineering Biology

The £380m investment continues the previous government’s plan to support six high-technology sectors—among them engineering biology and biomanufacturing—over a ten-year period. However, the strategy document does not clarify whether the previously proposed £2bn in long-term funding for synthetic and engineering biology under the Sunak conservative government (2022-2024) will still be pursued.

The UK currently ranks third globally in engineering biology, behind the United States and China, and the government has stated its intention to maintain at least this position through to 2035. The strategy responds to the emergence of a new global biotechnology market beyond pharma biotech, which, according to estimates by McKinsey and the Bank of England, could grow to between US$1.6tn and US$3.1 tn by 2040. Key application areas include agriculture, food, fossil-free plastics, chemicals, algal fuels, and energy.

The commitment forms part of the Digital and Technologies Sector Plan and is expected to initially benefit companies involved in cultivated meat, precision fermentation, and photosynthetic algae-derived carbon-negative fuels. A regulatory sandbox for cultivated meat, already funded with £1.6m until 2027, is intended to accelerate the authorisation of products within this category. Meanwhile, market approval for products developed using new genomic techniques has been liberalised in the UK since 2023. The plan also outlines a partnership with the newly established Regulatory Innovation Office, aimed at building on the sandbox’s outcomes and facilitating the responsible adoption of engineering biology products and services.

The funding announcement signals the UK’s strategic focus on engineering biology, a sector also targeted by countries such as the Netherlands and Belgium. “The UK has broad and deep strengths in engineering biology – including a world-class academic base, strong existing infrastructure and a skilled workforce – but it also faces several challenges that impact its global standing,” said Duncan Lugton, Head of Policy and Impact at the Institution of Chemical Engineers (IChemE), in an interview with European Biotechnology shortly before the strategy was released.

“One of the key issues is limited access to scale-up facilities, which significantly hinders the ability to translate innovation into commercial success. This constraint contributes to a talent drain, as skilled professionals often move to countries like Belgium and the Netherlands, where better scale-up capacity exists – and they take their exciting new innovations with them. In comparison, economic heavyweights such as the United States and China offer attractive conditions for engineering biology, further highlighting the UK’s relative lag in infrastructure,” he said. “While the UK remains a strong player in foundational research and innovation, its position is undermined by infrastructural gaps that affect both talent retention and commercial competitiveness.”

With the approval of this funding, the UK is set to outpace the European Union, where comparable initiatives are still in development. The EU’s bioeconomy strategy is scheduled for release in November, with a draft EU Biotech Act expected in the third quarter of 2026. Additional funding under the Multiannual Financial Framework (MFF) and the Important Project of Common European Interest (IPCEI) Biotechnology is not anticipated before 2028. As a result, EU biotech stakeholders are calling for interim measures to ensure the bloc remains strategically competitive. According to Euractiv, “European industry is calling for urgent action to remain competitive, and pushing for provisional measures while the Biotech Act is still in the making.”

However, German Chancellor Friedrich Merz has firmly opposed increasing the MFF by €200bn—an amount considered necessary by European Commission President Ursula von der Leyen, a member of Merz’s own party, to implement the Clean Industrial Deal. As a consequence, funding may need to be reallocated within the existing budget, a move that could delay the EU’s ability to respond competitively on the global stage by several more years.