Advanced Operating Models
Aug 10, 2017

Brexit: How regulatory changes affect the pharma industry

What impact will Brexit have?

The UK notified the European Council of their intent to withdraw from the European Union in March 2017 and become a "third country" as of March 30, 2019, based on the Article 50 time frame. The withdrawal of the UK from the European Union—popularly known as "Brexit"—will mean that all primary and secondary European laws will not apply to the UK. While official negotiations are still underway, what impact is Brexit likely to have on the pharmaceutical sector?

Brexit possibilities

Concerns have been raised that patients might have to wait 12 months longer than their European counterparts for access to innovative new medicines. If we consider that the UK currently only holds 3% of the global medicines markets, will pharmaceutical companies now see the UK as a much lower priority?

In a recent press release, Britain's Secretary of Health Jeremy Hunt and Secretary of Business Greg Clark tried to alleviate these concerns by maintaining their desire to continue to work closely with the EMA, emphasizing that “our door will always be open to a deep and special relationship with the EU, which remains the best way to promote improved patient outcomes both in Europe and globally." They also wrote: “The UK would like to find a way to continue to collaborate with the EU, in the interests of public health and safety."

Does this mean the UK follows an agreement like those held by Norway or Switzerland? In October of last year, in fact, Prime Minister Theresa May explicitly ruled out following these agreements. But with the complexities of regulatory legislation and the possibility of negative impacts on UK patients, maybe EEA (European Economic Area – Norway, Iceland and Liechtenstein) or EFTA (European Free Trade Association – Switzerland) are models we could follow. Or we need to start planning for so-called "hard Brexit," a scenario in which the UK completely disengages from any existing European trade agreements.

Possible trade agreement models that could be implemented

The regulatory impact of Brexit

The EMA has already issued its acceptance criteria for countries to host the agency after it moves out of the UK. With applications now closed  and 19 offers to host the agency  the proceeding rounds of voting on the new location of the agency, is due to be decided by end of October 2017.

The EMA and national competent authorities have already started negotiations to ensure business continues, with the foresight that the UK will no longer participate in the work of EMA or CMDh. The agencies are advising marketing authorization holders to adapt processes and consider changes to the terms of the marketing authorization in order to ensure its continuous validity once the UK has left the EU. All variations and transfers will need to be planned and submitted in advance and with sufficient time to avoid any impact on continuous supply. 

Impact of Brexit on European procedures

Key point of impact of Brexit on European procedures

Brexit impact on centralized licenses

What happens next?

Based on the information we have so far, there is likely going to be significant administrative burden for all affected. The EMA needs to fill the gap left by the MHRA, which currently conducts assessments for approximately 20% of all new drugs.

Heat map showing number of licenses and impacted markets where due to a single CMC in procedure, all UK RMS will transfer to this member state

The MRHA will have to significantly increase in size in order to approve all new drugs aimed at the British market. NCA, taking on responsibility as RMS, will feel the burden, too. And while all life science companies will be affected, will generics companies feel the greatest impact? Time will tell. This is still a moving target and further changes may occur. There are certainly more questions than answers at present.

The main takeaway is that companies need to start assessing the potential impact on them, and to create plans and roadmaps to understand what they must do to ensure minimal disruption to business as usual. Genpact Pharmalink is focused on providing consulting opportunities to develop such a roadmap, including assessment and planning for changes in the following conditions:

  • All products where UK is MAH
  • Trials where a UK company is sponsor/applicant
  • Trials where UK is sponsor of orphan medicines
  • Trials where UK is RMS or CMS
  • Manufacturing site based in UK that acts as batch release or will then be considered as export
  • Assessment of a UK firm's participation in supply chain
  • Viability of moving or reassigning QPPV to EEA market

This blog is co-authored by Claire Colville, Assistant Vice President, Business Development, Genpact Pharmalink and Katharine Miller, Lead Consultant Genpact Pharmalink

About the author

Claire Colville

Claire Colville

Assistant Vice President, Genpact Pharmalink

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