Golden Triangle still dominates, but talent and capital gaps slow biotech growth

The Golden Triangle- the nexus of London, Cambridge and Oxford- has long boasted an identity as a highly productive scientific innovation engine and source of biotech clusters. But investors say persistent challenges in talent mobility, company formation and funding early and mid-stage capital slow the sector’s ability to scale as it has the potential to.

Other parts of the U.K. also have science innovation and company creation– and a more favorable tech transfer office (TTO) system than in previous years. Stumbling blocks lie in talent recruitment and capital investment.

The Golden Triangle label developed around 2006 to describe the elite cluster of science and research universities in the area, said Maina Bhaman, a London-based partner in the Sofinnova Capital Strategy group at Sofinnova Partners. In turn, pharma and biotechs also have a strong presence there.

While there is biotech coming out of areas like Nottingham and Dundee, Manchester and Sheffield, the Golden Triangle remains the U.K.’s core hub for biotech because science, capital and talent are concentrated.

Biotech is “a risky business, so you need talent to be able to move from company to company if things go wrong or even if things go right,” Bhaman said. “That’s why you have hubs.”

Recruiting and retaining teams is significantly harder outside the Golden Triangle, she and Amsterdam-based Hakan Goker, managing director at M Ventures, the corporate venture arm of Merck KGaA, agreed.

A lack of talent mobility among senior leaders can be barrier to scaling companies outside major hubs, Goker said. He contrasted Europe with the U.S., where senior executives routinely move across large geographic catchment areas.

“Some of those distances are easily further away than Amsterdam to London,” he said, noting that European leaders often remain reluctant to relocate or adopt optimized remote‑work models.

While remote work helps, scientists still need physical stability, making it harder to scale companies in emerging hubs, Bhaman explained.

Even before the Golden Triangle became defined, it took time to build critical mass, Goker added, with disparate U.K. centers. Europe faces similar fragmentation, with few hubs and many academic centers struggling to convert science into functioning companies.

The transition from academic science to company creation via TTOs at universities has tended to be long and cumbersome, Bhaman said. But the system in the U.K. has become more efficient.

“Spin-out creation used to be, I think, much more of a challenge than it is today,” she said.

But funding early science has also been more difficult in recent years, slowing momentum.

The U.K. life science investment scene is seeing cautious investments, with more now than in previous years, Goker said. U.K. pension funds will not invest in seed‑stage biotech, but they could play a critical role in later‑stage scale capital, Bhaman said. “We need early-stage deals in order to then be able to fund those later stage deals.”

Structural mismatches — fee expectations, reporting requirements and risk tolerance — have made pension participation in private markets difficult, she added. There government has set a goal to unlock pension money broadly, but only a handful of deals have materialized so far despite a 2030 target.

With missing new growth‑stage capital, early‑stage venture funds are in danger of folding, Goker said. Cash is locked in existing companies, leaving less room for new investments and declining fund recycling.

But positive signs are apparent, Goker said, citing more money deployed by corporate venture funds, or the development of new such funds. Consolidation among smaller funds and more firms adopting multistage strategies to maintain continuity will happen, Bhaman predicted.

Bhaman agreed that the environment is cyclical and improving. “We’ve had a pretty difficult couple of years,” she said. “I think things are on the positive move now.”