Prime Minister Theresa May has announced that UK research and development will be given an extra £2 billion a year by the end of this parliament to help maximise the sector's potential, as part of a new, modern industrial strategy designed to "get the economy firing on all cylinders".
The real terms increase in government investment for R&D will ensure that British business remains at the cutting edge of scientific and technological discovery, she said, in her first speech to the CBI Annual Conference.
The PM also announced a new Industrial Strategy Challenge Fund, overseen by UK Research and Innovation, that will back priority technologies such as AI, robotics and biotechnology.
It is hoped that this will help ensure that innovative products developed in the UK are also commercialised here, and help Britain "capitalise on its strengths in cutting-edge research".
A review of current R&D tax incentives is also on the cards, to secure the global competitiveness of the UK as a destination for scientists, innovators and investors, May revealed.
Research shows each £1 spent on R&D tax credits currently stimulates between £1.53 and £2.35 of additional investment in the UK, but the HM Treasury will look at whether this support can be made even more effective to actively encourage innovation.
Welcoming the plans, Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry, said the extra £2 billion a year funding for the sector "a hugely welcome and will be well received by everybody involved in UK life-sciences."
"Given the right support, the NHS has the infrastructure to become the go-to place for companies to research, develop and use new medicines," while "the next wave of medical technologies has the potential to bring investment, highly skilled jobs and improved healthcare for patients."
"Investment in both will benefit patients, the NHS and help secure the future of the UK life sciences sector," he said.