Business
Ministers’ botched £50m life sciences fund ‘achieved all its aims’
A “FAILED EXPERIMENT” of investing public money in risky biotech-style businesses cost Welsh taxpayers at least £28m but achieved all of its original objectives, a committee heard.
Giles Thorley, who heads the Development Bank of Wales, largely blamed external factors for the poor performance of the now-closed Wales Life Sciences Investment Fund.
And the chief executive told the Senedd’s public accounts committee the venture could be repeated in future provided the lessons are learned.
His report detailed how the Welsh Government-owned development bank lost £28.2m investing into “very high risk”, unprofitable life sciences businesses.
According to the paper published this week, the fund, which was managed by Arix Bioscience plc, paid £7.7m in fees or 15% of the initial £50m invested.
Mr Thorley revealed the fund contract set no limits on the fees charged by the manager.
He claimed the fund, which ran for the decade to 2023, met all of its initial four aims: to increase access to finance, attract businesses, grow the sector and boost research.
The fund also had an ambition to raise another £50m, bringing the total to £100m, but Arix invested £5m in 2016 – with only £21.8m returned to the public purse to date.
Managers ordinarily limit the investment into any one business to 10% but 40% of the fund was invested in only two businesses: Rutherford Health and ReNeuron.
Each received £10m from the fund and both later went under, returning nothing and raising concerns that the portfolio was “overly concentrated” in a handful of businesses.
Mr Thorley wrote: “Normally the maximum investment from a fund into a single business is limited to 10%. This mitigates the impact to the fund should some of the investments fail.”
The fund held investments in only nine companies, with three exceeding 10% each and totalling nearly 60% of all investments held.
By comparison, International Biotechnology Trust – a listed life sciences fund – holds dozens of investments to reduce risk, with none making up more than 5% according to its accounts.
That fund has returned roughly 60% to investors over the past decade compared with a -56% return for taxpayers from the Wales Life Sciences Investment Fund (WLSIF).
Mr Thorley said the failed investment strategy assumed the further £50m would be raised, which resulted in less diversification, increased risk and limited follow-on funding.
He also pointed to the pandemic, a big factor in Rutherford’s failure, and the high-profile collapse of the Woodford Equity Income Fund – a co-investor in some WLSIF businesses.
Mr Thorley said disappointing clinical trial results were the main factor for businesses like ReNeuron, which relaunched as a private company in March after a year in administration.
He said: “The nine investee businesses represented a broad portfolio, … from lower risk established businesses with revenue streams to very high risk (potentially very high return) pre-revenue businesses where future returns were wholly dependent on successful trials.
“To that extent, the portfolio was considered balanced.”
Mr Thorley pointed to Simbec-Orion, the fund’s only success story, which provided a £19.7m (2.24x) return on an £8.75m investment.
He wrote: “The fund did achieve all four of its objectives and it may have taken just one more portfolio company to succeed for the fund to have returned the full investment or profit.
“For that reason, provided all the lessons learnt from this fund are considered, the final lesson learnt is not to write off any future considerations for using a specialist fund manager with a dedicated fund as part of a wider approach to supporting growth in a business sector.”
But Senedd Members seemed less keen as they briefly discussed the paper on May 3.
Arix Bioscience blamed a two-year Wales Audit Office review of the fund as a major reason the extra £50m could not be raised.
Adrian Crompton, the auditor general for Wales who sits on the public accounts committee, said: “At a high level, the lessons learned report indicates that, the assessment is that all of the objectives of the fund were met and you, I’m sure, will have some observations on that.”

Describing the fund as a failure, Plaid Cymru’s Adam Price said: “I would suggest on the basis of this that we shouldn’t replicate this experiment.
“It’s fine to experiment but if an experiment fails and you say ‘oh well, it’s OK for us to try again’, I think there are some more basic questions.”
The public accounts committee, chaired by the Conservatives’ Mark Isherwood, decided to discuss the matter in more detail behind closed doors, excluding the public and press.
Business
Bid to convert office space into chocolate factory, salon and laundrette
A CALL for the retrospective conversion of office space previously connected to a Pembrokeshire car hire business to a chocolate factory, a beauty salon and a laundrette has been submitted to county planners
In an application to Pembrokeshire County Council, Mr M Williams, through agent Preseli Planning Ltd, sought retrospective permission for the subdivision of an office on land off Scotchwell Cottage, Cartlett, Haverfordwest into three units forming a chocolate manufacturing, a beauty salon, and a launderette, along with associated works.
A supporting statement said planning history at the site saw a 2018 application for the refurbishment of an existing office building and a change of use from oil depot offices to a hire car office and car/van storage yard, approved back in 2019.
For the chocolate manufacturing by ‘Pembrokeshire Chocolate company,’ as part of the latest scheme it said: “The operation comprises of manufacturing of handmade bespoke flavoured chocolate bars. Historically there was an element of counter sales but this has now ceased. The business sales comprise of online orders and the delivery of produce to local stockist. There are no counter sales from the premises.”
It said the beauty salon “offers treatments, nail services and hairdressing,” operating “on an appointment only basis, with the hairdresser element also offering a mobile service”. It said the third unit of the building functions as a commercial laundrette and ironing services known as ‘West Coast Laundry,’ which “predominantly provides services to holiday cottages, hotels and care homes”.
The statement added: “Beyond the unchanged access the site has parking provision for at least 12 vehicles and a turning area. The building now forms three units which employ two persons per unit. The 12 parking spaces, therefore, provide sufficient provision for staff.
“In terms of visiting members of the public the beauty salon operates on an appointment only basis and based on its small scale can only accommodate two customers at any one time. Therefore, ample parking provision exists to visitors.
“With regard to the chocolate manufacturing and commercial laundrette service these enterprises do not attract visitors but do attract the dropping off laundry and delivery of associated inputs. Drop off and collections associated with the laundry services tend to fall in line with holiday accommodation changeover days, for example Tuesday drop off and collections on the Thursday.
“With regard to the chocolate manufacturing ingredients are delivered by couriers and movements associated with this is also estimated at 10 vehicular movements per week.”
The application will be considered by county planners at a later date.
Business
First Minister criticised after ‘Netflix’ comment on struggling high streets
Government announces 15% support package but campaigners say costs still crushing hospitality
PUBS, cafés and restaurants across Wales will receive extra business rates relief — but ministers are facing criticism after comments suggesting people staying home watching Netflix are partly to blame for struggling high streets.
The Welsh Government has announced a 15% business rates discount for around 4,400 hospitality businesses in 2026-27, backed by up to £8 million in funding.
Announcing the package, Welsh Government Finance Secretary Mark Drakeford said: “Pubs, restaurants, cafés, bars, and live music venues are at the heart of communities across Wales. We know they are facing real pressures, from rising costs to changing consumer habits.
“This additional support will help around 4,400 businesses as they adapt to these challenges.”
The announcement came hours after Eluned Morgan suggested in Senedd discussions that changing lifestyles — including more time spent at home on streaming services — were contributing to falling footfall in town centres.
The remarks prompted political backlash.
Leader of the Welsh Liberal Democrats, Jane Dodds, said: “People are not willingly choosing Netflix over the high street. They are being forced indoors because prices keep rising and wages are not.
“Blaming people for staying at home is an insult to business owners who are working longer hours just to survive.”
Industry groups say the problem runs deeper than consumer behaviour.
The Campaign for Real Ale (CAMRA) welcomed the discount but warned it would not prevent closures.
Chris Charters, CAMRA Wales director, said: “15% off for a year is only the start. It won’t fix the unfair business rates system our pubs are being crushed by.
“Welsh publicans need a permanent solution, or doors will continue to close.”
Across Pembrokeshire, traders have repeatedly told The Herald that rising energy bills, wage pressures and rates — rather than a lack of willingness to go out — are keeping customers away.
Several town centres have seen growing numbers of empty units over the past year, with independent shops and hospitality venues reporting reduced footfall outside the main tourist season.
While ministers say the relief balances support with tight public finances, business groups are calling for wider and longer-term reform.
Further debate on rates changes is expected later this year.

Business
Pub rate relief welcomed but closures still feared
CAMRA warns one-year discount is only a sticking plaster as many Welsh locals face rising bills
A BUSINESS rates discount for Welsh pubs has been welcomed as a step in the right direction — but campaigners warn it will not be enough to stop more locals from shutting their doors.
The Campaign for Real Ale (CAMRA) says the Welsh Government’s decision to offer a 15 per cent reduction on business rates bills for the coming year will provide short-term breathing space for struggling publicans.
However, it believes the move fails to tackle deeper problems in the rating system that continue to pile pressure on community pubs across Wales, including in Pembrokeshire and Carmarthenshire.
Chris Charters, Director of CAMRA Wales, said: “Today’s announcement from the Finance Secretary that pubs will get 15% discount on their business rates bills is a welcome step.
“However, many pubs still face big hikes in their bills due to the rates revaluation which could still lead to more of our locals in Wales being forced to close for good.
“15% off for a year is only the start of supporting pubs with business rates. It won’t fix the unfair business rates system our pubs are being crushed by.”
He added: “Welsh publicans need a permanent solution, or doors will continue to close and communities will be shut away from these essential social hubs that help tackle loneliness and isolation.”
Mounting pressure on locals
Under plans announced by the Welsh Government, pubs will receive a temporary discount on their rates bills for the next financial year.
But CAMRA argues that many premises are simultaneously facing sharp increases following the latest revaluation, which recalculates rateable values based on property size and trading potential.
For some smaller, rural venues, especially those already operating on tight margins, the increases could wipe out the benefit of the relief entirely.
Publicans say they are also contending with rising energy costs, higher wages, supplier price hikes and changing customer habits since the pandemic.
In west Wales, several long-standing village pubs have either reduced their opening hours or put their businesses on the market in the past year, with landlords warning that overheads are becoming unsustainable.
Community role
Campaigners stress that the issue goes beyond beer sales.
Pubs are often described as the last remaining social spaces in small communities — hosting charity events, sports teams, live music and local groups.
In parts of rural Pembrokeshire, a pub can be the only public meeting place left after the loss of shops, banks and post offices.
CAMRA says supermarkets and online retailers enjoy structural advantages that traditional pubs cannot match, making it harder for locals to compete on price.
The organisation is now calling on ministers to introduce a permanently lower business rates multiplier for pubs, rather than relying on short-term discounts.
Long-term reform call
CAMRA wants whoever forms the next Welsh administration to commit to fundamental reform of the rating system, arguing that pubs should be recognised as community assets rather than treated like large commercial premises.
Without change, it warns, the number of closures is likely to accelerate.
Charters said: “This is about protecting the future of our locals. Once a pub shuts, it rarely reopens. We can’t afford to lose any more.”
For many communities across west Wales, the fear is simple: temporary relief may buy time — but it may not be enough to save the local.
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