Britain is failing to secure the economic benefits of its world-class scientific research because of the lack of a "coherent" government strategy to commercialise new discoveries, a parliamentary report warned today.
The House of Commons Science and Technology Committee identified a "valley of death" blocking the progress of scientific innovations from the laboratory to commercially successful businesses in the UK.
The cross-party committee said it was "troubling" that so many British technology start-ups have to be acquired by foreign companies before they can grow into thriving businesses, meaning that much of the wealth and jobs they create go overseas.
Today's report called on the Government to use the proposed bank for business to promote a bond market for medium-sized businesses, to provide capital which is often not forthcoming from finance markets focused on short-term returns and low-risk investments.
Regulation to de-risk pension funds has inadvertently closed off a patient source of capital for firms that need time to develop technologies, the report found.
The MPs also urged ministers to use the clout of government procurement budgets to invest in small technology businesses, and called for a Treasury minister to be given specific responsibility for this process.
Physicists announced evidence that we may be living in an enormous computer in 2012 - or at least the chance they might be able to test if we are. It's a slight announcement in some ways, but as by far our most popular running story of 2012 it's clearly among your favourites to be the most significant in the coming decades.
In July Nasa successfully landed the $2.5 billion Mars rover Curiosity on the surface of Mars using an untested 'sky crane' suspended by rocket boosters. It is the largest and most complex vehicle ever to make it to another planet, and will search for signs of life for more than two years.
To huge cheers and standing ovations, scientists at the world's biggest particle accelerator claimed the discovery of a new subatomic particle in July, calling it "consistent" with the long-sought Higgs boson popularly known as the "God particle" which gives matter its mass.
Several breakthroughs in the search for Earth-like planets outside our Solar System were made in 2012, including the discovery of what appears to be a 'Super Earth' in November. These finds take us closer than ever to finding a world capable of sustaining life other than Earth. The discovery of HD 40307g was probably the most exciting, as it was shown to be orbiting its sun in a so-called "goldilocks zone" just like Earth.
Nasa's Grail mission launched two craft - Ebb and Flow - into orbit around the Moon to produce the most detailed gravity map of any body in the Solar System - including Earth. They crashed (on purpose) in December, but their work could help us understand how our world was formed - and if life might be hidden in the depths of Mars.
Many breakthroughs in medicine were made in 2012, but among the most exciting was a study in July which showed how a drug for a rare type of cancer was able to "flush out" deposits of HIV. Work is still ongoing - and a cure is still far away - but it points in the direction of true breakthroughs in future.
SpaceX's Dragon spacecraft became the first commercial ship to dock successfully with the International Space Station and deliver supplies.
A robot was able to participate in open-heart surgery for the first time in Britain in 2012, raising hopes that the machines may eventually lead to man's emancipation from hardship and illness, and not our total annihilation.
A host of breakthroughs in the study of climate change made for depressing - and occasionally hopeful - reading in 2012. The rate of polar melting was shown to be at fresh record levels, and the most aggressive scenarios were said to be too conservative. But fresh talks at Doha, while they accomplished little in solid policy, raised some hopes at a widespread and transformative shift in public opinion.
Red Bull Stratos pilot Felix Baumgartner of Austria jumped from a capsule more than 24 miles up in 2012 - the highest jump ever and alone a significant technical achievement - but also among the most-watched public science experiments in many years.
Teleportation (albeit of information, not people) came a step closer to reality in 2012 after an international team was able to send quantum information more than 143 kilometres in "mid air".
A study in April was able to construct a working "quantum computer" network for the first time, indicating a truly transformative technological breakthrough in computing in which data could be transmitted by single atoms.
The Government should set out a clear strategy for future funding plans, to give business confidence to invest in its own research and development in favoured sectors, said the report.
And it called for consideration to be given to a requirement for investment funds to have a proportion of European small and medium-sized businesses in their portfolios.
Committee chairman Andrew Miller said: "The UK's university and science sector is a global success, but the challenge for government is how that world class academic research can be translated into commercial activity."
He added: "British entrepreneurs are being badly let down by a lack of access to financial support and a system that often forces them to sell out to private equity investors or larger foreign companies to get ideas off the ground."
A spokesman for the Department for Business, Innovation and Skills said: "The Government has set out a clear approach for making the most of our world-class science and research base.
"We are setting up the Business Bank, on top of introducing a substantial R&D tax credit scheme.
Despite enormous economic pressure, we have protected the £4.6 billion annual budget for science and research.
"Over £1.2 billion is being invested over three years through the Technology Strategy Board to support business-led innovation, of which £250 million is being spent establishing a network of Catapult Centres to bring new technologies to market.
"This week we announced around £50 million of projects supported by the Biomedical Catalyst, a £180 million programme to bridge the 'Valley of Death' in biomedical sciences."