Dementia costs the country £23bn a year - more than cancer and heart disease combined - but receives a fraction of the funding, according to a “wake up call” report.
The number of sufferers, at 822,000, is also 17% higher than has previously been estimated and will pass the one million mark before 2025, the Alzheimer’s Research Trust said.
Revealing stark differences in research funding, it calculated that for every pound spent on dementia studies, £12 is spent on investigating cancer and £3 on heart disease.
Alzheimer’s Research Trust chief executive Rebecca Wood called for greater resources to fight the condition, saying: “The true impact of dementia has been ignored for too long.
“The UK’s dementia crisis is worse than we feared. This report shows that dementia is the greatest medical challenge of the 21st century.”
She added: “If we spend a more proportionate sum on dementia research, we could unleash the full potential of our scientists in their race for a cure.
“Spending millions now really can save us crippling multi-billion pound care bills later.”
According to the report, which was prepared with experts from Oxford University, dementia’s overall annual cost dwarfs the £12bn cost for cancer care and the £8bn for heart disease.
The £23bn is made up of £9bn in social care costs, £12bn in unpaid care and £1.2bn in healthcare costs.
Each dementia patient costs the economy £27,647 each year, researchers found, nearly five times more than a cancer patient and eight times more than someone suffering from heart disease.
Royal College of Nursing chief executive and general secretary Peter Carter called for more specialist nurses in dementia to cope with the demand.
He said: “It is deeply concerning that the prevalence of dementia is thought to be even greater than previously thought. In the absence of a cure, this devastating condition will continue to affect increasing numbers of people for the foreseeable future.
“As well as improving funding for dementia research, greater investment is also needed for specialist dementia nurses, who provide invaluable support for dementia patients, their carers and families.”
Ian Weatherhead, lead nurse at Admiral Nursing Direct, said: “The huge extra cost identified in this new report is largely down to the cost of informal care. Family carers already know that the physical, emotional and psychological burden of care falls on them - this new research and report re-confirms that this burden is financial too.
“Increasing support to carers coping with dementia must be the national priority that the government has promised in the national dementia strategy. Those of us working directly with families gallantly attempting to get to grips with the devastating effects of this disease have seen no evidence of change.”