The UK BioIndustry Association (BIA) has called on the government to create a new venture capital fund structure so that the public will be able to invest in biotech.
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It has been suggested that this new fund should be similar to that of the successful Enterprise Innovation Scheme (EIS) and include a new ‘Holding Relief’, which will reward individuals with further income tax relief if they stay invested in the long-term.
Many current venture capital funds are too bureaucratic for the general public, according to the BIA, whose proposed new structure would offer income and capital gains tax reliefs. Additionally, these proposals will make it easier for fund managers to administer their funds as there will be more time allowed for them to identify and invest in suitable companies compared with that allowed in existing fund structures.
“The UK has world-leading bioscience companies that are delivering for patients and investors but too few people have the opportunity to share in their financial success. The fund structure we’re proposing will democratise opportunities to share in the success of UK bioscience and provide much-needed long-term capital for the UK’s most innovative companies,” explained BIA CEO Steve Bates. “We are working with the government and the investment community to address the scale-up challenge for UK companies. This will take innovative solutions and if we can combine the UK’s strengths in FinTech and Biotech, I’m confident we can deliver the finance required for our companies to meet their global ambitions.”
The BIA’s proposals were made in response to an HM Treasury consultation for a new fund structure as part of the Patient Capital Review.