Strategies to attract inward investment from suppliers to the NHS

Inward investment plays a critical role in strengthening the NHS supply chain, driving innovation, and enhancing healthcare delivery.

However, the current landscape presents significant challenges that deter potential investors and suppliers. Fragmented procurement processes, short term contracts, a lack of centralised coordination, and regional disparities in investment promotion create barriers to engagement, particularly for international stakeholders and SMEs. To unlock the full potential of inward investment, the NHS must address these systemic inefficiencies and establish clear, accessible pathways for collaboration. By creating a unified strategy that aligns national and regional efforts, the NHS can position itself as a global leader in healthcare innovation and a more attractive destination for international investment.

Recommendation 1: Centralised repository of information

Establish a comprehensive centralised repository of information to guide overseas suppliers on how to navigate the UK healthcare market and supply the NHS effectively. This should be easily accessible and understood, and promoted at international conferences and events, highlighting the unique assets of the UK, such as universal health coverage and extensive health data resources.  

Rationale: The lack of clarity surrounding NHS procurement pathways and contracting methodologies hinders effective engagement and participation from suppliers, particularly international investors and SMEs. 

The NHS operates as a globally open system, inviting innovation and partnerships from suppliers worldwide. However, its vast and decentralised procurement system presents significant challenges for potential investors and suppliers, particularly those from international markets.

With over 1,400 procurement frameworks managed by NHS trusts and Integrated Care Boards, the system is highly fragmented, making it difficult to identify clear and consistent pathways for engaging with the NHS. The contracting system is also fairly inflexible in terms of use of the NHS standard contracts which don’t always quite “fit” the circumstances and/or the use of framework contracts which all differ and add a layer of complexity.  

While there are no explicit regulatory barriers preventing investment, the sheer complexity and lack of transparency in procurement processes act as a significant deterrent to many potential partners.

This decentralised approach creates confusion for suppliers who may not know which frameworks apply to their products or services, how to submit bids, or how contracts are awarded. The absence of standardised guidance or a centralised repository of information further compounds these issues. Suppliers, particularly SMEs and international companies, often perceive the system as overly complicated, resource-intensive, and uncertain. For many, this lack of clarity becomes a barrier too significant to overcome, discouraging them from pursuing opportunities within the NHS.

Without transparent processes, the NHS risks losing out on innovative solutions and strategic investments that could enhance service delivery, infrastructure, and patient outcomes. While efforts are being made to streamline procurement processes, the lack of a comprehensive and centralised resource remains a critical challenge.

Creating a detailed and accessible guide to NHS procurement and contracting covering eligibility, application procedures, timelines, compliance requirements, contract pathways and points of contact would improve accessibility for suppliers and help position the NHS as a more attractive and reliable partner for global investment.

Designation of clear pathways through which successful pilot initiatives may progress to longer-term contractual arrangements could provide contracting certainty to encourage sustained investment and enable suppliers to make informed, strategic decisions around scaling their innovations.

The UK Government and NHS should actively promote the benefits of investing in the NHS at international conferences and events, showcasing unique assets such as universal healthcare coverage, extensive health data resources, and leadership in genomics. To attract targeted foreign direct investment, DHSC and the NHS must provide clear guidance to investors, signalling specific clinical and geographical priorities while minimising focus on lower-priority areas (https://www.gov.uk/government/organisations/department-of-health-and-social-care).  It would make sense for the DHSC to create an interactive inward investment toolkit for potential investors to access and use, which could be available in multiple languages.

Recommendation 2: A unified ‘NHS Front Door’ for investment

Develop a unified ‘NHS Front Door’ for investment to act as a single, centralised entry point for foreign investors to streamline engagement with the NHS.

Rationale: A fragmented, regional approach confuses foreign investors and limits engagement. A unified NHS entry point would streamline processes, improve coordination, and enhance the UK’s appeal as a global healthcare investment hub.

The lack of a single, centralised entry point for foreign investors has created significant challenges in engaging effectively with the NHS and the broader UK healthcare landscape. The devolution of powers across the UK has led to a fragmented approach to inward investment promotion, with regional authorities, innovation hubs, and local initiatives often operating independently and with competing priorities. This decentralisation creates confusion for international stakeholders who struggle to identify a clear pathway into the UK healthcare market, undermining their confidence and deterring investment.  What works in one place may not somewhere else.

While resources such as the Department for Business and Trade’s (DBT) Accelerating Access into the NHS Market offer guidance, the absence of a unified platform leaves investors without a clear or cohesive mechanism to access opportunities. This fragmented system prevents the NHS from fully leveraging its potential as a global leader in healthcare innovation and economic growth.

Regional initiatives have demonstrated the potential to foster innovation and attract investment, but their impact is limited by the lack of a national framework. Programmes like Propel@YH and Leeds Hospital Innovation Pop-Ups have shown how regional efforts can successfully support SMEs and international companies by providing mentorship, resources, and direct collaboration with clinicians and patients. 

While these initiatives demonstrate significant potential, their limited integration with national objectives constrains their scalability and diminishes their appeal to larger international investors. Establishing a unified ‘NHS Front Door’ for investment would resolve these issues by providing:

• Clarity and simplicity: A streamlined process for foreign investors to navigate NHS procurement pathways and contracting routes and identify opportunities.
• National coordination: Integration of successful regional programmes like Propel@YH and Leeds Hospital Innovation Pop-Ups into a cohesive framework aligned with national healthcare and economic priorities.
• Enhanced scalability: Integrating regional programmes into a broader framework to amplify their reach and impact on a national scale.

This centralised platform would enhance investor confidence by offering a clear and efficient gateway into the NHS. By consolidating regional efforts under a unified strategy, the NHS would be better positioned to attract and manage international investments, fostering long-term partnerships and driving innovation at scale. This would enable the UK to move from a fragmented system to a harmonised framework that maximises its appeal to foreign investors and fully realises the NHS’ potential as a global leader in healthcare innovation and economic growth.

Recommendation 3: A dedicated central business development unit

Develop a dedicated central business development unit within the NHS to consistently manage trade and investment conversations and bridge knowledge gaps in international commercial operations.

The absence of a reciprocal mechanism for managing inward and outward investments has led to fragmentation, inefficiencies and missed opportunities to leverage economies of scale and maximise the returns from NHS partnerships. A dedicated central business development unit within the NHS could provide the necessary structure to address these gaps, streamline trade and investment efforts, and align them with the NHS’ operational needs and global opportunities.

This central unit would serve as a cohesive platform for:

• Managing trade and investment conversations: Acting as a single point of contact for inward investment and facilitating consistent engagement with international stakeholders.
• Bridging knowledge gaps: Addressing gaps in international commercial operations across NHS provider organisations, ensuring they are equipped to engage effectively with global investors and exporters.
• Fostering global partnerships: Supporting NHS involvement in bilateral trade agreements, particularly with target countries like India, Kenya, and South Africa, which have shown strong interest in collaboration.

By centralising expertise and resources, the NHS could integrate its efforts into broader trade discussions and align with successful strategies previously employed by the former Department of UK Trade and Investment. This would enable the NHS to better navigate international markets and position itself as both a driver of innovation and a contributor to global health priorities.

The unit should adopt a reciprocal approach that supports the export of UK goods and services. By facilitating partnerships aligned with equity and global health security goals, the NHS can expand its influence in international markets while advancing its global citizenship agenda. This approach would mirror the success of previous UK trade strategies and foster opportunities for globally active NHS trusts to secure centralised authorisation for international collaborations.

To ensure alignment with specific NHS needs, the unit should involve representatives from NHS sub-sectors in investment discussions. By tailoring solutions to organisational requirements and aligning supply and demand within international markets, the NHS can build an integrated and scalable approach to investment and trade.

A central NHS business development unit would not only address the systemic challenges of fragmentation and inefficiency but also position the NHS as a pivotal player in global health innovation and bilateral trade.

Framework for action

• Fast-track policies: Streamlining approval processes to enable quicker integration of international partnerships and investments.
• Regulatory clarity: Providing comprehensive guidance on regulatory requirements, such as Care Quality Commission (CQC) standards, to reduce barriers for international collaborators.
• Flexible contracting mechanisms: Enabling NHS organisations to explore innovative approaches and pilot new solutions with reduced administrative friction.
• Enhanced intellectual property (IP) management: Improving the valuation and management of NHS IP to ensure partnerships generate maximum returns.  
• Rationale: The absence of a reciprocal mechanism for managing inward and outward investments leads to fragmentation, inefficiencies, and missed opportunities to leverage economies of scale and maximise returns from NHS partnerships.

Recommendation 4: Enhance regulatory agility

Enhance regulatory agility to attract MedTech and Digital Health innovation with a focus on investment in the health sector

Rationale: The UK’s departure from the EU has reduced its attractiveness as a strategic gateway to Europe. Combined with post-Brexit bureaucracy and regulatory complexities, this has led to fragmented investment efforts, a decline in SME engagement, and diminished competitiveness in attracting inward investment.

The UK’s healthcare sector must respond to these challenges by leveraging its post-Brexit regulatory freedoms to streamline approval pathways for MedTech and digital health innovations. These emerging industries represent a high-growth opportunity for investment but achieving this requires a proactive approach to regulatory agility. The Life Sciences Sector Plan recognises the existing regulatory hurdles to market entry for innovative technologies and proposes a number of welcomed interventions to address these barriers.

By simplifying approval processes for low-risk and innovative technologies while maintaining safety standards, the UK can position itself as a leading destination for global healthcare innovation. This includes creating AI Regulations which enable a flexible approach and agreement with Europe and other jurisdictions, on reciprocity of authorisation approvals.

Adequately funding and empowering the Medicines and Healthcare Products Regulatory Agency (MHRA) will be critical to this effort, enabling faster approvals, fostering international collaboration, and ensuring the UK remains competitive in attracting cutting-edge solutions.

A dynamic and targeted strategy is also needed to reposition the NHS and UK healthcare sector as an attractive destination for inward investment. This includes promoting the NHS brand and broader UK healthcare offering as a global asset, by leveraging the NHS’ unique strengths, such as its commitment to green healthcare solutions and its vast, data-rich infrastructure, to appeal to environmentally conscious and data-driven investors.

Highlighting the NHS’ unparalleled academic and research capabilities can help differentiate it from other global healthcare systems, while efforts to support domestic innovation such as integrating cost-effective solutions into NHS operations will retain local talent and enhance the sector’s overall competitiveness.

By combining regulatory agility with a broader strategic approach to investment, the UK can address post-Brexit challenges and reassert itself as a global healthcare investment leader. This integrated approach will not only attract MedTech and digital health companies but also drive sustainable growth, ensuring the NHS and the broader UK healthcare sector remain resilient, innovative, and globally competitive.