David Cameron is to unveil plans to allow patients' records and other NHS data to be shared with private life science companies.

In a speech on Monday, the prime minister will argue that giving researchers from private sector companies access to NHS information will make it easier for them to develop and test new drugs and treatment.

He will argue that cutting the regulation that restricts collaboration of this kind could boost the life science industry, which already employs 160,000 people in the UK, with an annual turnover of £50bn.

Andy Burnham, the shadow health secretary, said he was not opposed to the idea in principle, but that the government would have to "tread carefully" because of privacy concerns.

A Downing Street source said: "Britain has the potential to become a powerhouse in the world's life sciences industry.

"We want to see much closer collaboration between the NHS and life science companies – not just greater data-sharing, but more clinical trials in hospitals. These changes will not only boost the industry, but also potentially give the NHS early access to new, innovative drugs treatments."

The government has already taken steps to make official data more available in a wide range of areas. Some of this has commercial value, such as Ordnance Survey mapping details.

"The life sciences industry is of vital importance to the UK economy and we are committed to greater collaboration with the NHS to ensure that patients can get faster access to valuable innovative treatments," the Department for Health said.

"All necessary safeguards would be in place to ensure protection of patients details – the data will be anonymised and the process will be carefully and robustly regulated."

Cameron is also expected to announce details of a scheme that could give cancer suffers and other seriously ill patients access to potentially beneficial drugs up to a year before they have been fully licenced.

Andrew Witty, the chief executive of GlaxoSmithKline, the pharmaceutical company, told the Sunday Telegraph he welcomed the data-sharing initiative.

"Any action the government takes to improve the environment in this country for life science across these activities is welcome."

But Joyce Robins, from Patient Concern, said she was opposed to private firms being able to get access to confidential medical information.

"Even when they say records will be anonymised, the amount of detail contained in medical records means that companies may be able to find ways to target people with particular conditions," she said. "This data is absolutely private; it is not the government's to give."

Burnham told Sky on Sunday that the government should proceed with caution.

"We hear lots of talk about red tape from this government, but there are some areas where proper regulation is absolutely essential, and use of patient records is most certainly one of those areas," Burnham said.

"I'm not saying I'm necessarily opposed to what the prime minister is saying. I will study his words very carefully indeed, but this government has a cavalier approach to these matters."