When AstraZeneca announced its restructuring two weeks ago, the prognosis seemed pretty dire for everyone. The closure of the drug company’s research centre at Alderley Park was a body blow to the North West, to 1,600 workers and also to the Chancellor whose Tatton constituency it sits in.
The latest dose of medicine took Astra’s job cull to more than 11,000 in two years; a decline matched only by its sales, which have fallen 16pc to $27.9bn (£18.4bn). Announced just two days before the Budget, it seemed symptomatic of the deep–set malaise in the UK economy.
However, 150 miles away in Cambridge, scientists were viewing the restructuring through a different lens. Astra said it was moving its HQ from London to Cambridge – but rather than a humiliating retrenchment to the shires, they were hailing the move as affirmation of one of the world’s fastest growing business clusters.
Largely unnoticed elsewhere, this medieval town is booming. A tech firm called Trampoline Systems has recently produced the Cambridge Cluster map to illustrate the phenomenon: it offers a guide, not to colleges and churches, but another side of Cambridge’s global attractions: biotech and IT firms.
It shows 1,535 companies which employ some 53,203 people and generated £12.2bn revenues last year. There are five firms worth more than £1bn and the area has one of the highest concentrations of Nobel prizewinners in the world. You can click on the map – above – to see the fastest growing, the number of employees, revenues and even use Linked-In to see who you know at each one.
“We’ve lost some of our scientific confidence,” Pascal Soriot, chief executive of Astra, said. He believes the company can rediscover it in Cambridge.
Entrepreneurs, scientists and investors are making the same bet. George Freeman MP, pictured below, the Coalition’s adviser on life sciences, and Dr Andy Richards, boss of the Cambridge Angels, who has funded at least 20 of the city’s start–ups, are among its champions.
“The big pharmaceutical model is dead, we have to help the big companies reinvent themselves,” said Freeman. “Cambridge is leading the way on how do this, on research and innovation.”
The pair are convinced that the burgeoning “Silicon Fen” is rapidly becoming the global centre of pharma, biotech, and now IT too. Richards says the worlds of bioscience and IT are “crashing together” and revolutionising companies and consumers. Tapping his mobile phone, he says: “This isn’t just a phone, it could hold all sorts of medical information, too, on your agility and reactions. This rapid development is what it’s all about.”
Cambridge, he says, is ready and able to generate “real and sustainable” economic growth. But there’s a big hurdle: infrastructure. It all seems a bit old economy, but these cutting–edge startups want fast trains, more schools and the A14 to be expanded.
Richards says: “This cluster is moving way faster than the infrastructure. Normally it’s the other way round – you build the infrastructure and wait for companies to come. Here it’s just going nuts, and it’s now being held back by the infrastructure. Scientists can spend half the day on a bus or in traffic. To grow, Cambridge needs help.”
The cry is the same in the labs and offices of Cambridge’s network of science parks. Derek Jones, chief executive of the Babraham Research Campus, which is currently incubating 44 start–up companies, says: “For the bioscience industry, the AstraZeneca relocation is fantastic, it’s a great reflection of the growth and importance here. In terms of infrastructure, it’s a bit more problematic – how does Cambridge cope with so many people?”
Niall Martin, boss of one of the Babraham companies, Mission Therapeutics, says: “Cambridge is on a cusp – it’s got everything that businesses need to start and grow. But can it provide a good enough environment for it to really kick off?”
This week, Freeman is off to seek help from Lord Heseltine, whose regional development plan has just been adopted wholesale by the Government. The Tory grandee has proposed pooling all the Government’s resources for regional development into a single fund – potentially worth £65bn – for infrastructure and other spending.
“Birmingham and Liverpool and the great northern cities that Lord Heseltine is trying to help are important,” says Freeman. “But Cambridge is the biggest growth city in the British economy. But it’s basically a medieval market town – it needs £1bn investment today; it needs the Oxford–Cambridge–Norwich railway line electrified, now.”
The Cambridge phenomenon is obvious to anyone on the ground. Straight outside the station, amid a series of new developments, is Microsoft’s new HQ and offices that house Cantab Capital Partners, the macro hedge fund, among others. East, towards Cambridge airport, is the old Philips headquarters, which is now full of biotech start–ups.
Plenty of politicians reckon the “cluster” was invented in 1994 when a Harvard academic called Porter wrote a seminal paper on the subject. In fact Cambridge cluster has emerged slowly over generations, with its roots inevitably in the 800–year–old university.
Cambridge people will say Philips is a big part of the story. When the electronics company shut up shop in the 1970s, it made hundreds of highly competent people redundant, who looked to set up their own firms rather than move out of the city. Many set up technology consultancies which helped big firms or the Government on specific problems.
Around the same time, the bioscience spin–outs started coming out of the university. Trinity College was the first to set up a science park.
St John’s College set up another park where Autonomy started and more than 50 companies are now based. As we pass, on cue a red Ferrari zooms out. “We didn’t see Ferraris when I was a boy,” says Freeman. “Just old academics on their bikes.”
He adds: “That’s the great thing about tech, you can suddenly get it, make it commercial and you’ve got £200m. You don’t have to spend four generations of a German family building Mittelstand.”
The recent growth spurt has occurred in and around Addenbrooke’s Hospital in the south of the city, putting into action the drive for hospitals, academics and drugs companies to work together in research and innovation.
On south to Babraham – the site is centred on an imposing Victorian manor house but surrounded by large modern glass buildings. Cancer Research Technologies has just moved into one. Another, built using government funding from the 2011 Budget, is a rabbit warren of individual labs and offices that houses and incubates the start–up firms. There are also 400 scientists and 70 PhD students at work.
Mr Jones says: “If you’ve got a good idea, we can give you a lab, a hot–desk, equipment. The idea is to allow you to share the expensive kit you need, but also put you in a community to allow you to grow quickly. We’re lowering companies’ activation energy; how can we ease their path from being embryonic to being a bit more established.”
He adds: “We have fundraising events and investor forums which are open to those outside the community, too. For example, one event we run involves 120 people drinking coffee and eating doughnuts, and the big companies like Pfizer and MedImmune can come here and meet people informally, that can lead to formal relationships.”
By all accounts, the model is working. If the Coalition delivers on its infrastructure commitments, Cambridge could find the cure to the UK’s economic ills.
Please click here for original source