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Labour donor's firm gets £1.8m to cure baldness
Last updated at 21:22pm on 21.10.06
A company part-owned by a Labour donor arrested in connection with the 'cash for peerages' scandal has been given a £1.85million Government handout to find a 'cure' for baldness.
The value of Sir Christopher Evans's stake in research company Intercytex rocketed by more than ten per cent following news of the taxpayer-funded grant.
The announcement came just days after the tycoon was arrested by Scotland Yard detectives over the £1million he loaned to Labour to bankroll its Election campaign.
Sir Christopher's investment firm Merlin Biosciences owns a 14 per cent share in Intercytex, worth around £7.4million, and until last year had a seat on its board. That stake rose by about £750,000 following the Government hand-out.
The entrepreneur advises the Government on scientific industries and is credited with convincing Tony Blair to push Britain as a world leader in biotechnology.
That commitment led to the Department of Trade and Industry establishing a £330million Technology Programme, which has helped more than 400 projects.
It was this fund that awarded Intercytex the £1.85million to develop a robotic system capable of making dermal papilla cells, the main cells involved in hair regeneration, on a commercial scale. Other future uses could include treating battlefield wounds and growing human organs.
Sir Christopher, who is chairman and founder of Merlin and who was paid a £1.2million consultancy fee by the firm last year, said the grant was 'good news' but added that he had no involvement in securing the taxpayers' cash.
Last month Sir Christopher was held by police over claims the Government traded peerages for loans. Former Government adviser Des Smith and Mr Blair's chief fundraiser Lord Levy have also been arrested.
After his arrest, Sir Christopher said: "Frankly, if I thought for one moment that I would be placed in this embarrassing and mind- boggling position, I would not have made the loan."
Announcing the award to Intercytex, Science Minister Lord Sainsbury, who has also bankrolled Labour, said: "This initiative provides a real opportunity to harness the world-class expertise that we possess in the UK and direct it towards wealth creation."
Last night Sir Christopher said: "I knew nothing whatsoever about the grant until it was announced publicly by the company, nor would I expect to.
"It doesn't surprise me that Merlin Biosciences has an investment in a company that has applied to the DTI for a grant. Merlin is the most prolific investor in young companies in the sector - that's what we do.
"We've invested in more than 45 British biotech companies. If a company chooses to apply to the Government for funding, that is up to them.
"The Government is supportive of the biotech sector because Britain is brilliant in this area."
A spokesman said Merlin controlled the stake in Intercytex through one of its managed investment funds. He said Sir Christopher has a small personal investment in the fund, which controls £165million for various individuals and City institutions.
A DTI spokeswoman said: "The project is not funding a "cure" for baldness. If successful it could also be used with other cell and regenerative therapies.
"No Ministers were involved in the decision to fund this project. The decision was made by DTI officials, and the application form does not require a list of investors."
