Brexit – How is it looking for Life Sciences Companies?
The UK government has this week published four reports indicating that market access for UK life sciences companies will not change during the Brexit implementation period of 29 March 2019 to 31 December 2020. So why are AstraZeneca, Sanofi, Novartis and other pharmaceutical companies announcing plans to stockpile drugs in preparation for Brexit? The government has been clear that the recently-agreed terms on the implementation period will only take effect "once finalised as part of the Withdrawal Agreement". As the spectre of a "no-deal Brexit" continues to loom large, businesses within the sector have no choice but to continue preparing for the worst case scenario.
What will happen during the implementation period?
In a document spelling out What the implementation period means for the life sciences sector, the government has said that during the transitional period:
- UK batch release testing and Qualified Person certification will continue and will be recognised by the EU and vice versa;
- Marketing authorisation (MA) holders can continue to be based in the UK whilst accessing EU markets. There will be continuing mutual recognition of manufacturing and distribution licences, and associated inspections (such as good manufacturing practice (GMP));
- UK companies can continue to apply for MAs via the centralised or decentralised procedures;
- CE marking of medical devices will continue for the UK and EU markets and UK-based industry will not require an authorised representative in the EU. UK notified bodies will continue to conduct third-party conformity assessment in the UK with the results recognised for both markets.
In a further report, the government has said that licences for centrally authorised products (CAPs) will continue to be valid for the EU and UK. It has also clarified, in a separate report, its intention to follow the new Clinical Trials Regulation which is due to take effect from 2020.
The government has re-stated its aim to finalise the Withdrawal Agreement by October 2018 adding that it remains "confident of a positive outcome from the negotiations".
Where does this leave the UK's life sciences sector?
The priority for the sector - which currently employs over 250,000 people nationwide and contributes over £70 billion a year to the economy - is to ensure the continuing flow of medicines into the UK and, in the longer term, to maintain the UK's position as a global centre of excellence for research. Unless the government secures a post-Brexit deal which ensures close regulatory alignment with Europe, these aims are at risk.
The government has said that products which have not completed a centrally authorised assessment process by the end of the transitional period may have to start the approval process again in the UK. The possibility of a separate UK regulatory regime is of deep concern to many operating within the sector. This could cost tens of thousands of pounds for each new drug released, potentially making the UK an unattractive market for new medicines. The UK is also running out of time to create its own regulations and associated institutions. There are also fears about border control measures: how do we access cancer therapies based on radioisotopes if we are no longer a member of Euratom? Delays at the border could pose particular problems for these products which have very short half-lives.
On the other hand, there are some areas of research that might benefit from UK-specific regulation. The EU's restrictive approach to genetically modified organism (GMO) products is seen as an anchor on scientific progress in the development of foods and the use of certain gene editing techniques. In the longer term, a regulatory system that enables research in these and other areas like stem cell technologies could help preserve the UK's enviable reputation for life sciences expertise.
The more immediate hope is that October 2018 will bring a deal involving some form of mutual recognition of authorisation and regulatory decisions as between the UK and EU to ensure that vital drugs continue to reach the patients that need them. Until then, companies must continue ploughing resources into contingency planning which they might otherwise have invested in better healthcare outcomes for patients.