The bioscience sector in Oxfordshire is booming with the county taking the lion’s share of UK investment.

A report by the Oxfordshire Bioscience Network (OBN) shows county firms in the field attracted £125m of investors’ cash — 80 per cent of the total for the whole of the UK.

It added that overall investment is recovering to levels seen before the recession and is at its highest for five years.

But while experts have welcomed the news, they have also warned that a lack of available properties for new firms investing in the county could cause stagnation in the future.

OBN chief executive Jon Rees said: “The continued strong performance of biosciences is great for the Oxfordshire economy, when taken together with the bid for an Enterprise Zone in the county.

“Our research shows the companies in the BioCluster are raising enough money to stay at the forefront of biomedical research, leading the way and taking the lion's share of UK investments.”

The OBN BioCluster Report is conducted every three years and shows there are 163 companies in the sector in Oxfordshire, employing 5,000 people.

It reveals firms have emerged from the funding drought of 2008, in which just £37.5m of investment was generated with the amount raised so far in 2011 equalling what was raised in 2009 and 2010 combined.

The report added that £276m of venture capital investment was raised in the Oxford BioCluster between 2008-2010, an increase of 50 per cent on the previous three years.

And 28 companies were added to the sector between 2008 and 2010.

Key deals this year include the sale of the Type 2 diabetes treatment developed by Prosidion Oxford for £374m and £60m of fundraising by allergy specialist Circassia based at the Oxford Science Park.

Nigel Wild, president of the Oxfordshire Chamber of Commerce and an expert in the biotech sector, described the report as “a silver lining in the dark cloud of the current economy.”

He added: “The county and its cluster are probably the strongest in the UK at present.

“The recent announcement by e-Therapeutics that it is returning to Oxfordshire to benefit from world-class staff speaks volumes.”

But he joined Mr Rees in suggesting a general unwillingness by property developers to expose themselves to risk could hamper future development causing dwindling space on the county’s business and science parks.

Mr Rees said: "We've been advising for some time that there is a lack of an infrastructure system — there are virtually no unlet buildings left suitable for science-based research and development businesses to locate to in Oxfordshire.

“Ultimately, the risk adversity of developers may limit further growth to the technology cluster in Oxfordshire.”