Eli Lilly is reconsidering plans for its U.K. biotech-focused Gateway Labs, citing concerns about the industry’s outlook in the country and low government spending on new drugs, according to reports from several outlets.
"Lilly is not yet in a position to finalize our investment in a Lilly Gateway Labs site, as we are awaiting more clarity around the U.K. life sciences environment," a spokesperson told Fierce in an emailed statement.
Gateway Labs are designed to be biotech accelerators with lab space and support for researchers.
Previously, the pharma giant announced plans to launch a Gateway Labs site in the U.K. as the first European site for the program. Now, Lilly has hit the pause button due to the low prices paid by the country’s National Health Service, according to The Pharmaceutical Journal, which first reported the news on Sept. 11.
The new biotech site was announced as part of a 279 million pounds sterling (about $378 million) planned Lilly investment into the U.K.’s life sciences sector. The funding was part of an agreement with the U.K. government and is designed to zero in on significant health challenges, such as obesity.
The pause is "just related to the Lilly Gateway Labs part of the £279 million memorandum of understanding signed with the U.K. government last year," a Lilly spokesperson told Fierce.
Lilly already operates two Gateway Labs sites in South San Francisco, one in San Diego, another in Boston, and one in China.
Lilly’s decision comes after the drugmaker halted shipments of weight loss juggernaut Mounjaro (tirzepatide) to the U.K. at the end of August, in advance of a plan to hike up the med's list price by as much 170%.
The pause is the latest blow to the U.K.’s biotech industry, which is still reeling from Merck’s recently announced R&D exodus, including the cancellation of a 1 billion pound sterling London research center, and a report that bemoaned the country’s lagging competitiveness in the industry.
Editor's note: This story was updated at 1:55 p.m. ET to include information from Lilly.