Biorbyt is a biotech company headquartered in Cambridge, but its work is in demand across the world. It supplies the life science sector with bioreagents for use in research projects. Its customer base primarily reaches across the UK and into Europe and the US.
While the market has bounced back as COVID-19 restrictions lifted, there are still some logistical challenges, particularly around exports.
“Any delays in supply chain logistics have a huge impact on us,” says Qun Yang, COO and co-founder of Biorbyt. “Our products can be temperature-sensitive. Shipping to Europe is much more complicated, with more paperwork involved. That adds extra cost.
Exporting to countries such as Germany can require additional certificates, and that specifically adds cost. This is a bigger issue than the price of energy, says Yang. To tackle this, Biorbyt is working to expand its network of distributors across Europe. “We’ve also invested heavily into our IT systems to be able to upload more documents and deal with all of the documentation requirements for exporting,” she says.
The UK is still a powerhouse in life sciences, and investment in the sector is still strong, says Yang. Investment has slowed a little this year in the context of the various economic pressures impacting on all sectors at the moment.
“In general, people are more aware of the importance of life sciences, and the more money that goes into it, the more we hope to see an increase in sales and more activity in this sector. I’m also a big believer in artificial intelligence, the power for data and automation. We’re working on how we can better automate our whole process, and how to get product data on our website to make it quicker to release to customers.”
The R&D tax credit is a fantastic incentive for the sector, says Yang. It encourages a lot of activity in the life science sector. The zero VAT rating in the sector is also helpful. Both of these are effective incentives in encouraging activity.
On a regional level, Yang would like to see more investment and support outside of London. There are life science hubs in Cambridge and Norwich, but they need a better ecosystem.
“There’s a lack of lab space,” she says. “In Stevenage, they’re building new labs, but there’s a lot of activity going on around Cambridge, and not enough lab space and not enough support for the ecosystem from the government. There are some local networks, but those initiatives from local companies are not the same as what the government can do.”
Rising inflation will have an impact, but further down the line, sometime in 2023, Yang explains. That’s when they’ll feel the cost-of-living crisis the most. “We are in the process of buying a property, and securing a good fixed rate is a priority. All of these basic costs will go up, but we are competing on an international level.”
In that context, the weaker pound is a help, as it encourages exports to a degree. But the international market is very competitive, Yang explains. “We’re very cautious at this stage. It does affect our confidence when it comes to investing in certain fixed assets.”
Biorbyt’s finance team is engaged in scenario planning to help the business plan for variations in business growth and inflation. Budgets will adjust as the company reviews performance. A major goal for next year is to expand into the US: to fully serve that market, the company will need a base there, Yang explains.
“The US is more optimistic in terms of funding and business growth, so we are looking into that. The ongoing impacts of Brexit make us a bit worried. We don’t want to be too isolated in the UK.”
Yang looks at Brexit from a purely practical perspective: “Now that we’ve left the EU, the question has to be: how do we do business better? How do we address the admin challenges? And we need to make sure we’re an attractive destination for talent? I think that’s a fundamental question: how to make the UK more competitive or attractive?”
- Find out more about the ICAEW Economic Summit
Discover more from ICAEW Insights
Insights showcases news, opinion, analysis, interviews and features on the profession with a focus on the key issues affecting accountancy and the world of business.
Hear a panel of guests dissect the latest headlines and provide expert analysis on the top stories from across the world of business, finance and accountancy.Find out more
News in brief
Read ICAEW's daily summary of accountancy news from across the mainstream media and broader financing sector.See more
Stay up to date
You can receive email update from ICAEW insights either daily, weekly or monthly, subscribe to whichever works for you.Sign up