MD2436 MedCity

In July 2014 the Mayor approved the allocation and expenditure of up to £1.125m of grant funding from the LEP Growing Places Fund (GPF) as a contribution to the costs of the establishment of MedCity, over a three-year funding period. This has been allocated as outlined in paragraphs 1.2 to 1.5 below.

The Mayor (under cover of MD1298) approved expenditure of £150,000 for activity related to the interim delivery of MedCity, and later (under cover of MD1375) approved expenditure of up to a further £975,000, over a maximum of three years, by way of grant funding to MedCity Limited. £182,000 was made available in 2014/15 and the rest would be subject to the GLA’s annual approval of the MedCity business plan.

In the financial year 2015/16, the Mayor (under cover of MD1458) approved MedCity Limited’s 2015/16 business plan and expenditure of up to £400,000 of grant funding to MedCity Limited.

Separately from the main grant, the Mayor approved (under cover of MD1561) expenditure of up to £40,000 of grant funding in the financial year 2015/16, as a contribution to its costs of a life sciences workspace study. The Executive Director for Development, Enterprise and Environment approved (under cover of DD1445) additional expenditure of up to £12,000 of grant funding in the financial year 2015/16, as a further contribution to the same study.

In the financial year 2016/17, the Mayor (under cover of MD1615) approved MedCity Limited’s 2016/17 business plan and expenditure of up to £400,000 of grant funding to MedCity Limited.

Following the expiry of the original funding agreement with MedCity, the Mayor (under cover of MD2071) approved the further award of funding to MedCity Limited and its 2017/18 business plan, expenditure of up to £500,000 of grant funding being made available in the 2017/18 financial year. A new funding agreement was entered into in this regard which also made provision for the award of up to a further £875,000 (£375,000 in 2018/19, £295,000 in 2019/20 and £200,000 in 2020/21), subject to the GLA’s approval of business plans for the same.

In the financial year 2018/19, the Mayor (under cover of MD2241) approved MedCity Limited’s 2018/19 business plan and expenditure of up to £375,000 of grant funding to MedCity Limited.

MedCity Limited has submitted its 2019/20 business plan for GLA approval, which is a condition of the release of 2019/20 grant funding of up to £295,000 as a contribution to its costs of delivering that business plan for this coming financial year.

MedCity’s refreshed vision is for the organisation to be a key enabler in London and the Greater South East, so that the region continues to be a world leading, globally connected life sciences cluster, gateway to the UK and top in Europe. Taking into account market context and external factors such as Brexit, the vision has evolved but is complementary to the previously outlined vision of delivering regional health improvements and economic growth and being at the centre of a growing, global life sciences sector for the benefit of the country. The MedCity Business Plan (see Appendix 1) states that the organisation’s purpose is to enable economic growth in life sciences and support the development of an ecosystem in which all parts of the sector can thrive.

To achieve this vision, MedCity’s mission is to connect multi-disciplinary excellence across academia, industry and healthcare systems in order to drive growth and investment across research, development, manufacturing and commercialisation.

MedCity Limited was established by the GLA and London’s three Academic Health Science Centres (AHSCs) – Imperial College Academic Health Science Centre, King’s Health Partners and UCLPartners.

The GLA is not a member of MedCity Limited, but has entered into agreements with each of the Members to afford it the right to become a Member in future. The Agreements state that Members of the company are not permitted to change the articles or to invite other organisations to become a Member without the consent of the GLA, and cannot take a decision on any matter that requires GLA agreement or consent, without first gaining the GLA’s agreement or consent.

A grant agreement is in place to govern the GLA’s funds. Each year’s grant award is subject to the GLA’s approval of MedCity’s annual Business Plan and to the GLA issuing a grant award letter.

GLA grant funding is essential to enable MedCity to meet its staffing costs including the MedCity Executive Chair, Chief Executive Officer, and Chief Operating Officer costs – to undertake activities aimed at growing and promoting the life sciences sector in London and the GSE. These activities include (see Appendix 1):

• Providing a ‘front door’ service: meeting the needs of international and national clients;
• Connecting Excellence: with the ambition of London and the Greater South East to continue to be recognised internationally for excellence in key capabilities, and, as a result, increase the numbers of industry/academic partnerships and collaborations as well as clinical research activity;
• Attracting investment: MedCity’s ability to influence and shape the investment space, planning and real estate sector, enabling significant global and strategic partnerships; and
• Supporting the growth of a globally dynamic hub for SMEs and spinouts: with the ambition for the region to be globally recognised as a dynamic hub for SMEs and spinouts across the life sciences sector, but in particular in MedTech, Digital and AI.

Overall, MedCity seeks to:

• Attract significant investment into the sector and the region;
• Increase the numbers of industry/academic partnerships and collaborations as well as clinical research activity; and
• Increase and accelerate opportunities for small companies to commercialise.

A prudent approach has been taken in the MedCity Business Plan 2019/20 (Appendix 1), which outlines an operational plan based on continued financial support from the GLA, bids for further ERDF funding, approved funding from Research England via a King’s-led programme, and commercial and sponsorship income. Projects that MedCity hopes will be enabled by additional income as a result of successful bids to the Research England Development Fund and the LEAP are outlined separately (Appendix 2).

MedCity has secured the following funding for 2019/20 (see Appendix 1):

• £295,000 GLA grant funding (subject to Mayoral approval of the 2019/20 MedCity Business Plan).
• £100,000 as delivery partner for the Research England Connecting Capabilities Fund Advanced Therapies Programme, led by King’s College London.
• £100,000 underspend from the HEFCE funding, ringfenced for MedCity’s Collaborate to Innovate programme.

In addition, MedCity:

• Is awaiting written approval for £120,000 interim funding from Research England (RE). A bid for a further £380,000 of RE funding is in process;
• Has a further two funding bids in play – one of which is London-specific – for a potential total of £150,000; and
• Projects commercial and sponsorship income in the region of £100,000 (related KPI subject to discussion by the MedCity Management Board).

MedCity objectives that support GLA priorities in 2019/20 include:

• Developing and implementing a plan for active promotion of the ‘Front Door’ Service to ensure MedCity continues to be widely known in its target markets;
• Assess MedCity’s role vis-à-vis trade and export with partners (L&P), and implement recommendations; and
• Evaluate whether real estate and demand for space has changed since the publication of the last demand study, recommend and implement next steps.

At a strategic level, MedCity is undertaking activities that will increase the health and wealth outcomes from life sciences research and commercialisation across London and the GSE. For example, 92 additional direct life sciences FDI jobs resulting from the MedCity project by end 2017/18, with a total estimated cumulative gross GVA of over £13.6m – cumulatively above target.

MedCity has made good progress to date in generating additional income from diversified sources. As of January 2019, MedCity have reported generating approximately £136k from a combination of commercial projects, and sponsorship and participation fees for specific events and programmes (includes some VAT, tbc).

MedCity’s draft 2019/20 financial plan (see Appendix 1) outlines that a continued significant proportion of public funding – whether GLA, LEAP or Research England – will be required, in addition to ongoing diversification of income sources. This income mix reflects the need for continued public funding to address deep-seated market failures, alongside a diverse range of other funding streams to support long term financial sustainability.

The GLA will ensure that when MedCity is planning and delivering its programme of activities, that it adheres to the requirements of the Equality Act 2010 to demonstrate that that it is making decisions in a fair, transparent and accountable way, considering the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010, and to advance equality of opportunity and foster good relations between persons who share a protected characteristic and persons who do not. This will be achieved through assessing the impact that changes to programmes of work could have on people with different protected characteristics, where appropriate. The GLA recognises when providing grant funding to MedCity, that assessing the impact on equality of proposed changes to policies, procedures and practices is not just something that the law requires, it is a positive opportunity to ensure that better decisions are made based on robust evidence.

The GLA has compiled a wide range of evidence by policy area for the protected characteristics identified in the Equality Act, the GLA’s ‘Equality, Diversity and Inclusion Evidence Base’. The Evidence Base identifies that young women are less likely to study science, technology, engineering and maths (STEM) at A-level. Within the STEM subjects, variations between young men and women can be seen. Girls have a stronger focus on biological sciences whilst boys have a stronger preference towards mathematics and physics.

MedCity aims to advance equality of opportunity in the delivery of the MedCity programme of activity. MedCity will ensure equality of opportunity for all protected groups through the organisation’s staff recruitment and selection processes, and when organising events, in particular through ensuring MedCity events are accessible for people with disabilities.

MedCity will consider opportunities to promote female entrepreneurship at MedCity-facilitated/hosted events to address the current under-representation of women in the STEM sector. It will also consider ways to improve the representation of women and black, Asian and minority ethnic people at senior levels in life sciences organisations. The Mayor has made commitments to make improvements in these areas as part of his Equality, Diversity and Inclusion Strategy.

1. Key risks and issues

2. Links to Mayoral strategies and priorities

1. The table below illustrates how MedCity supports the aims outlined in the Mayor’s Economic Development Strategy to work with the life sciences sector to support further growth, and to help address the major healthcare challenges facing society.

3. Consultations and impact assessments, including data protection

1. The GLA commissioned Regeneris Consulting Ltd to evaluate the MedCity programme in December 2016. The evaluation report concluded that the programme was performing well against KPIs and that it had also delivered added value to the life sciences sector across the Greater South East region and nationally.

1. The MedCity team has undertaken an action plan to ensure GDPR compliance. There is currently no data sharing between the GLA and MedCity.

The proposed GLA Grant of up to £295,000 for 2019/20 has been included in the GLA budget and held within the GLA’s Regeneration and Economic Development Unit.

In-line with previous arrangements, payments will be made on a quarterly basis subject to satisfactory monitoring of performance against the deliverables approved as part of the 2019/20 business plan. This requirement as well as the standard break clauses will be incorporated into the funding agreement to ensure that performance and risk is managed effectively during the duration of the grant agreement.

The foregoing sections of this report indicate that the decisions requested of the Mayor concern the GLA’s exercise of its general powers to do such things considered to further or which are facilitative of, conducive or incidental to the promotion of economic development and wealth creation in Greater London and in formulating the proposals in respect of which a decision is sought officers have complied with the Authority’s related statutory duties to:

- pay due regard to the principle that there should be equality of opportunity for all people;

- consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom; and

- consult with appropriate bodies.

In taking the decisions requested, the Mayor must have due regard to the Public Sector Equality Duty; namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010, and to advance equality of opportunity and foster good relations between persons who share a relevant protected characteristic (race, disability, gender, age, sexual orientation, religion or belief, pregnancy and maternity and gender reassignment) and persons who do not share it (section 149 of the Equality Act 2010). To this end, the Mayor should have particular regard to section 3 (above) of this report.

If the Mayor is minded to make the decisions in respect of which approval is sought officers must ensure that the proposed release of funding is administered and managed in accordance with the funding agreement between the GLA and MedCity Limited.

The MedCity 2019/20 Business Plan sets out an Action Plan and deliverables, which cover the following key areas of MedCity’s activities (please see Appendix 1 for further detail):

• Provide a ‘front door’ service to the region’s life sciences sector;
• Connect excellence to support collaborations within the sector;
• Attract investment to London and the Greater South East; and
• Support the growth of a globally dynamic hub for SMEs and spinouts.

The GLA monitors MedCity progress against a number of KPIs and project milestones, which are agreed with GLA Governance each year. A quarterly project Dashboard is submitted to GLA Governance. The lead GLA officer attends regular project update meetings with the MedCity team. The Manager of the Industry and Innovation Team is also in regular contact with the MedCity leadership and maintains oversight of the project. The GLA – represented by the Head of Economic Development and lead officer – also attends MedCity Management Board meetings as an observer.