LIFE SCIENCES companies in Scotland are now generating a combined turnover of £2.5 billion, according to a report prepared by Young Company Finance.

The paper, which will be presented to European and American venture capitalists and investors attending the BioEquity Europe conference in Glasgow this week, shows that the sector now employs 30,000 people in 590 organisations.

The industry, which is growing at 7% to 8% a year, is estimated to add more than £1 billion of value to the Scottish economy. The latest Office of National Statistics figures indicate that this rate of growth in annual Gross Value Add is four times the medium-term average growth rate of the Scottish economy overall.

Ken Snowden, co-director of the life sciences team at Scottish Enterprise, said the numbers were encouraging as they did not take into account the contribution that non-industry-related academics make through employment, research and intellectual property.

The numbers also reflect the importance of large companies, as the majority of those revenues have been generated by production and manufacturing of drugs, diagnostics and medical devices carried out by big, foreign-owned companies like LifeScan, based in Inverness.

The report also highlights the investment being put into research areas such as stem cells, which are expected to be future contributors to the economy.

The Sunday Herald can reveal that reaching that goal could soon be helped by the award of a pot of money to drive a number of Scottish-invented stem cell therapies into clinical trials.

The UK Stem Cell Foundation, which raises money to take stem cell projects from the lab into pre-clinical trials and eventually to patients, is expected to grant around £1.2 million to researchers at Edinburgh University to regenerate cartilage and bones damaged in sports or by degenerative diseases such as osteoarthritis. The research group, led by Dr Brendon Noble, has worked out how to create cartilage-forming cells and bone-forming cells from adult stem cells taken from a patient's own bone marrow or fat. Within two years it hopes to begin human clinical trials in which a biomaterial scaffold that carries the stem cells and a pharmaceutical agent to activate them would be implanted into the injured area to help it regenerate. Noble and his team are focused on patient benefits but there are also potential commercial gains.

"It may be that it's not the cell type that you are selling but the method of collection and the system needed for delivery into the patient," Dr Noble says, explaining that that could be the biomaterial scaffold and the pharmaceutical agent that activates the stem cells.

Another Scottish project awaiting the green light on £500,000 of funding from the foundation aims to restore the sight