The UK’s life sciences sector attracted more than £3bn investment in the last 12 months, and the timescale for conducting clinical trials has accelerated, according to the department for science, innovation and technology.

This includes a £1bn, 10-year investment from Germany’s BioNTech announced last May, and a further £1bn 10-year commitment from Moderna for its Harwell campus; a further £500m from Belgium’s UCB Pharma in Windlesham, as well as £500m from the medical products maker Convatec in a research centre in Manchester.

The average wait time to set up clinical trials has dropped from 169 to 122 days in the first half of 2025/26 and patients are also expected to get new medicines up to six months sooner under the new joint MHRA-NICE approval process.

The government has sought to draw a line under a very damaging public row with the pharmaceutical industry over pricing and access to new medicines.

James Murray, the health secretary, said:

In the year since we launched our Life Sciences Sector Plan, this government has brought in £3bn to speed up access to innovative treatments and transform the experience of patients.

We also smashed our 150-day target for clinical trial set-up, slashing red tape to get those trials up and running at the speed patients deserve.

By bringing together the brilliance of British science with the power of our NHS, we’re not just improving healthcare outcomes – we’re also building a stronger economy and creating jobs across the country.

Pascal Soriot, the chief executive of the UK’s biggest pharmaceutical company AstraZeneca which had been at loggerheads with the government, said:

2026 has been an important year of tangible action advancing UK life sciences. The first ever increase of the NICE threshold since 1999, the establishment of the Health Data Research Service, and measures to speed up clinical trial delivery.

We look forward to working with the government to further strengthen its global competitiveness and build on this momentum.

AstraZeneca said in April it will invest £300m in the UK in a surprise U-turn after pausing large-scale projects last year.

The drugmaker had pulled back investments in Britain after becoming disillusioned with the business environment, including the availability of new medicines on the NHS and drug pricing. It will invest in two existing locations, unfreezing a paused £200m expansion in Cambridge and pouring £100m into its Macclesfield site.

However, Soriot has repeatedly stressed that more work needs to be done to make the UK more competitive.

Eurostar has responded to the heatwaves across Britain, France and the rest of Europe by upgrading an order for 50 doubledecker trains to withstand Sahara-style temperatures.

The Channel Tunnel rail operator amended the terms of its deal with French manufacturer Alstom last week – dubbed the “Sahara option” – to ensure onboard equipment can cope with temperatures as high as 55C.

The original €2bn (£1.7bn) order for up to 50 “Celestia” doubledecker trains, announced last October, included air conditioning and running equipment that would function and keep passengers cool if outside temperatures rose to 45C.

But, Eurostar reviewed the decision after France experienced its three hottest days on record last month, with peak temperatures above 40C. Heat-related deaths rose by almost a third during a heatwave that scorched much of Europe.

Gwendoline Casenave, Eurostar’s chief executive, explained that the Celestia trains won’t be delivered until 2031 and are likely to see three decades of service, by which time temperatures in Europe may match highs seen today in North Africa and Arabia.

Casenave said this week’s heatwave – the third in Europe this year – vindicated the investment as temperatures once again hit 40C in France, with highs of 35C expected in London on Thursday.

She told The Telegraph:

We thought, hey, this is northern Europe – the UK, Germany, Switzerland – and in France we don’t go south of Paris, so up to 45 degrees is OK.

Then, a week ago, after the last heatwave, we decided to take the 55C option. We are buying trains that will last 30 years, and we thought maybe in the 2060s, even in the UK, the temperatures could reach those levels. It’s more expensive but it will be worth it.

She said the new package, dubbed the “Sahara option”, will feature improved air conditioning as well as higher-grade components and microprocessors able to operate at higher temperatures.

The German fashion brand Hugo Boss has urged shareholders ⁠to reject a €2bn (£1.7bn ) takeover offer ​from Britain’s Frasers Group, saying it is “financially inadequate“.

The company, known for its sharp men’s suits, said the €38-per-share cash offer — a premium of just 4.3% to the share price when it was announced — ⁠reflected the legally required minimum price for Frasers to raise its stake, rather than Hugo Boss’s intrinsic value or potential.

Chief executive Daniel Grieder said:

Hugo Boss has a well-defined strategy, a strong financial profile, and a ⁠compelling path to superior long-term value creation.

Shares rose slightly, by 0.2%, to €37.88. ‌The stock briefly jumped in early June after Frasers announced its bid, but remains about 50% below its level three years ago.

“The nature of the offer was highly tactical” and “destined to face stiff resistance,” said Felix Jonathan Dennl, an analyst at the Frankfurt-based bank Metzler.

He added Hugo Boss management had the backing of two independent financial institutions and a mandate to reject the bid.

Grieder, who took the helm five years ago, set out to turn Hugo Boss into a leading global brand. But his expansion plans coincided with a post-pandemic slowdown in consumer demand ‌as the cost of living surged.

Hugo Boss undershot Grieder’s pledge to return to pre-pandemic margins by 2025 and reported a 1% drop in sales last year, which it blamed on weak consumer demand in ​Britain and China.

In December, the company cut its 2026 operating profit forecast and launched a new strategy through 2028, dubbed “Claim 5 Touchdown“. The plan aims to improve efficiency in its stores, focus on faster-growing categories such as shoes and accessories, and expand in womenswear.

Frasers, which owns 26% of Hugo Boss, launched the bid to raise its stake above ⁠30% — the threshold at which German regulations require it to make a full takeover ​offer to other shareholders.

The offer price is “less ​a statement of valuation and more the ​mechanical extension of an accumulation strategy“, Citi said in a note.

Dennl said Frasers’ low-premium ​offer preserved its strategic flexibility, ‌leaving open the possibility ​of increasing its stake further ​without triggering a new takeover bid.

While Hugo Boss’ management successfully held the line today, the pressure has intensified on CEO Daniel Grieder to demonstrate that the ’Claim 5 Touchdown’ strategy can restore both top- and bottom-line growth in an increasingly volatile retail environment.

In financial markets, government bond yields have retreated slightly, but remain elevated. This means higher government borrowing costs, complicating the task for prime minister-in-waiting Andy Burnham, who wants to kickstart economic growth and reform Britain, from transport to high streets.

The yield, or interest rate, on the benchmark 10-year gilt has dipped 1 basis point but remains at 4.95%, close to the 5% mark. It jumped about 10bps on Wednesday triggered by a sharp rise in the oil price, which raised fears of higher inflation and interest rate hikes.

Eurozone bond yields also slipped but remained around their highest levels in seven weeks. The yield on Germany’s 10-year Bund fell 1bp to 3.074% after jumping 10bps on Wednesday to hit 3.094%.

Oil prices dipped in early trading but are now up again. Brent crude, the global benchmark, is trading nearly 1% higher on the day at $78.7 a barrel. It jumped more than 5% on Wednesday and briefly rose above $80 a barrel.

Following in Asia’s footsteps, European shares rose modestly with the exception of the UK’s FTSE 100 index, which lost 0.6% to 10,426.

The boss of 14 Greek airports has called for a serious overhaul of the EU’s new border checks, after being forced to erect gazebos for passengers to cope with queues.

The chief executive of Fraport Greece, Alexander Zinell, joined a growing chorus of critics calling out “fundamental flaws” in the entry-exit system (EES), which requires non-EU passengers to have their fingerprints and photo taken at the start of the their trip and verified every time they leave or re-enter the Schengen zone.

His airports have already used gazebos to shield queuing passengers from the scorching sun as they wait to be processed, while vulnerable people have been prioritised through security to ensure their safety.

“It is very unpleasant for passengers, and even dangerous,” Zinell said.

Greek authorities have indicated that police will not check UK passengers in practice, although there is no blanket legal exemption from the biometric tests. Visitors from the UK make up the bulk of non-EU tourists passing through Zinell’s aiports, which include Corfu, Rhodes, Mykonos and Crete.

Border police have flexibility under EU rules to suspend checks in peak queues but that right is set to lapse in September. Zinell said it was the only thing keeping the system, which was first rolled out last October, from collapse.

Volkswagen’s proposal to slash up to 100,000 jobs and close factories faces a major test on Thursday as they are formally put to its supervisory board, with protests planned at all plants in Germany.

IG Metall, the influential staff union, has organised demonstrations involving shop stewards and union council members at 18 sites at Europe’s biggest carmaker, including its headquarters. It told the chief executive, Oliver Blume, that he cannot “pass the buck for failures of recent years on to the workforce”.

Christiane Benner, the chair of the union, said: “This sends a clear signal to the board,” which will be asked to review the wide-reaching plans, leaked to the media last month, for the first time today at VW’s headquarters in Wolfsburg.

This autumn’s London fashion week boasts plenty of familiar labels, from Burberry to Alexander McQueen, ready to show off their wares. But on Wednesday there was an unexpected addition: Marks & Spencer is joining the luxury lineup.

The British high-street retailer will celebrate its 100th anniversary in the fashion industry by staging a catwalk show in September highlighting its latest women’s and menswear collections.

Stuart Machin, the chief executive of M&S, said the decision to show at LFW was an opportunity to “showcase our designs on fashion’s global stage” and was part of the retailer’s wider efforts to transform itself into a go-to fashion destination for high-street shoppers.

Laura Weir, the chief executive of the British Fashion Council, described M&S as “one of the great icons of the British high street”, adding that the retailer had played “an important role in the nation’s retail and cultural story for generations”.

As the barometer rises again… Great Britain’s energy system operator has warned that “extreme temperatures” could hit power supplies on Thursday night, as the UK entered its third heatwave of the year.

The National Energy System Operator (Neso) issued a notice overnight asking for extra supplies from power generators to cope with the added demand from households turning on fans and air conditioners to cope with the high temperatures.

It comes only weeks after Neso issued pleas for extra electricity during last month’s heatwave, when the UK recorded a provisional high of 37.7C at Lingwood in Norfolk on Friday 27 June, smashing the previous June record of 35.6C, set in 1976.

Parts of southern England are likely to hit highs of 34C on Thursday, and while temperatures are expected to stay below June’s record-breaking levels, the hot weather is due to last much longer, dragging out over 10 days.

In a statement, Neso said it was “giving participants the opportunity to make any additional generation or flexibility available during the forecast period.

Our forecasts indicate tight electricity margins during tomorrow [Thursday] evening’s peak period,” the operator said. “This is due to extreme temperatures across Europe, reducing the availability of some generation.

Also on the healthcare front, shares in the UK’s biggest private hospital operator Spire Healthcare rose after a takeover deadline was extended.

In May, the Spire board backed a buyout proposal worth £1bn from its second biggest shareholder, a hedge fund manager known as “the Rottweiler”, sending its shares soaring by nearly 50%.

The non-binding proposal is worth 250p a share and comes from funds advised by the activist investor Toscafund Asset Management.

Spire, which owns the Claremont hospital in Sheffield and St Anthony’s hospital in south London, said on Thursday that Toscafund has told its board that the due diligence process is “well advanced”

and that it continues to work towards the announcement of a 250 pence per Spire Healthcare share recommended offer.

Toscafund has also updated the board on the progress that it has been making on other aspects of the cash offer. Given the progress being made on due diligence and transaction documentation, Toscafund requested that the board grants a further extension to enable it to finalise its financing arrangements, which are also well advanced and include seeking a private credit rating.

Spire said it had granted the extension for Toscafund to make a firm bid, to 5pm on 6 August. Its share price rose 2.4% to 216.5p in early trading.

Britain’s second-biggest drugmaker GSK has also taken a hit from recent drug failures.

The Californian biotech Alector has said that GSK has ended their neuroscience collaboration covering ​two experimental antibody drugs, after both drug candidates suffered setbacks in clinical trials.

The decision follows the failure of a late-stage study of latozinemab ​in a rare inherited form of ​frontotemporal dementia last year, followed by the discontinuation of ⁠a mid-stage Alzheimer’s disease trial of ​nivisnebart in April.

This is a big blow to Alector. Under the terms of the deal announced in 2021, Alector received $700m upfront from GSK ‌and ⁠could have received up to $1.5bn in further payments tied to drug development-related milestones and royalties.

The failure of latozinemab prompted Alector ​to cut nearly ​half ⁠its workforce, while the nivisnebart trial was discontinued after an interim ​analysis showed the study was unlikely ​to ⁠meet its primary goal.

AstraZeneca is the biggest loser on the FTSE 100 index after a new heart disease drug failed in a late-stage clinical trial.

The shares crashed nearly 10% and are now down 9.2%. This is dragging the FTSE 100 down, which fell 52 points, or 0.5%, to 10,435.

The UK’s biggest pharmaceutical company said its nerve disease drug Wainua, made in partnership with the Californian biotech Ionis, failed to meet the main goal of reducing cardiovascular (CV) deaths and recurring heart problems in a phase three trial.

AstraZeneca said “Wainua did not provide a statistically significant benefit on the composite outcome of CV mortality and recurrent CV events”.

Sharon Barr, executive vice president of biopharmaceuticals research at the company, said:

The CARDIO-TTRansform trial was designed to examine the role of Wainua, a gene silencer treatment, on top of today’s standard of care in reducing recurring cardiovascular events and mortality.

Although the trial did not meet its primary objective, we believe the results support greater scientific understanding of treatment approaches for the hundreds of thousands of patients worldwide suffering from this progressive and often fatal condition.

The two companies will analyse the full data set to further understand the results, which will be shared with the scientific community at the European Society of Cardiology Congress in August.

The outsourcing company Capita has warned that failures on the UK’s civil service pension contract will reduce its annual profit by up to £40m, triggering a sharp drop in its share price.

Its boss Adolfo Hernandez admitted the company’s work on the pension scheme had not been “good enough” and vowed to do better.

The shares fell 17% after the profit warning. The UK government has withheld £9.9m in payments, citing missed contractual deadlines and Capita’s failure to deliver on AI-led technology improvements.

Hernandez, the Capita chief executive said:

We recognise the service on Civil Service Pension Scheme has not been good enough, we are working closely with the Cabinet Office on all aspects of the scheme, and this remains our number one priority. The wider Group continues to perform robustly, and we are confident in the actions we are taking to build a simpler, more focused Capita.

Capita said it was working through the backlog as quickly as possible, protecting members, and ensuring new cases are processed within contractual service times.

Despite the progress made to date, we recognise the service has not been good enough, particularly for members waiting on bereavement, retirement, and quotation cases, and we are sorry for the distress and inconvenience experienced by those members. We now have the processes, automation and technology in place to work through the backlog.

The company admitted that it will incur a number of additional costs this year, including hiring temporary staff and remediation costs. Overall, this will reduce adjusted operating profit impact for 2026 by between £25m and £40m.

The saga piles further pressure on Capita, which provides support services to the government and the private sector, and the UK’s paymaster general Nick Thomas-Symonds publicly criticised the company.

Capita also added that it had won some new contracts.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The UK housing market remains subdued but the downturn eased last month, ⁠while sentiment remains “fragile,” according to surveyors and estate agents.

They expressed ongoing concerns about the impact of inflation, the cost of living, UK political uncertainty and global conflicts, with some sharing hopes that the recent ceasefire in the Iran war will boost market conditions.

The survey’s headline house ‌price balance was little changed at -33%, from a revised -34% in May, while price expectations rose to +8% from +6% according to a monthly survey from the Royal ⁠Institution of Chartered ⁠Surveyors (RICS). The balance subtracts those who say demand fell from those who report it rose.

New buyer enquiries remained negative, with a headline net balance of -29%, but this was a slight improvement on the -34% recorded in the previous two months and marks the least negative reading since February.

Newly agreed sales also remained subdued, with a net balance of -32%, but a small improvement from -35% previously.

Near-term sales expectations improved to -16%, from a recent low of -34% in March. Looking further ahead, respondents expect sales volumes to remain broadly flat over the next twelve months, with a net balance of +1%.

However, new instructions to put properties on the sales market moved further into negative territory, dropping to -23% from -10%, the weakest reading in more than a year. Market appraisals also declined, suggesting the pipeline of homes coming to market may remain limited in the months ahead.

RICS head ‌of market and analysis ‌Tarrant Parsons said:

June’s survey results offer some cautious encouragement that the worst of the slowdown in market activity may be beginning to pass, with several key indicators moving in a less negative direction for a second consecutive month. That said, any nascent improvement remains fragile and is now being tested by renewed political uncertainty on the domestic front.

While the Bank of England left interest rates unchanged, uncertainty around ⁠the outlook for inflation and borrowing costs continues to weigh on sentiment, even if the ⁠recent decline in oil prices is a welcome development.

Until there ​is greater ‌clarity over ​both ​the political backdrop and the path of interest rates, housing market activity is likely to remain relatively subdued in the near term.

In the lettings market, tenant demand picked up, with the headline net balance rising to +18%, the strongest reading since May 2025.

Landlord instructions remained negative at -18%, pointing to continued supply constraints. Against this backdrop, rents are expected to continue rising, with projected rental growth over the next twelve months standing at around 2.5%.

The north of England continues to express more positive sentiment than the south generally.

Dan Stocks, a surveyor in Guildford, said:

Market uncertainty remains due to Labour leadership changes, cost-of-living pressures, fuel prices, the ongoing Russia–Ukraine war and the recent conflict involving Iran, all of which continue to weaken confidence.

After Wednesday’s jump in oil prices, where Brent crude briefly went above $80 a barrel, crude is little changed on Thursday.

Brent dipped 0.3% to $77.78 a barrel.

Asian stock markets mostly bounced back following Wednesday’s losses. Japan’s Nikkei rose 1.4% and China’s CSI 300 advanced 1.9% while South Korea’s Kospi gained 1%.

China’s producer price inflation has risen to the highest in four years, piling pressure on manufacturers as weak domestic demand restrains their ability to raise prices.

China’s economy is showing a two-track dynamic as a global AI boom lifts advanced manufacturing while weak household spending and the property downturn weigh on domestic activity.

The producer price index rose 4.1% year on year to the highest since July 2022, according to the National Bureau of Statistics. This is up from a 3.9% gain in May and reflects the impact of soaring energy prices because of the Iran war.

The Agenda

• 12.30pm BST: ECB account of June meeting

• 1.30pm BST: US Initial job less claims for week to 4 July

• 3pm BST: US Existing home sales for June