Does a multiple entry Schengen visa issued from the Italian embassy allow you to visit London once you are already in Italy or any Schengen area country? Or do I need to get a separate visa to the UK before travelling?
The UK is not in the Schengen area. The countries that are colored in blue in this map:
(green is for countries that are legally bound to join)
So the answer to your first question is no. As for your second question... whether or not you need a Visa for the UK depends on your country of origin.