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Impact of Brexit on the Pharmaceutical Industry

The pharmaceutical industry is one of the most important industries that will be directly impacted by Brexit. When the United Kingdom’s referendum was held in June 2016, the majority of the British electorate voted for the withdrawal of the UK from the European Union (EU) and now Brexit is a reality. Brexit and its potential impact on the regulatory environment within the healthcare system is one of the hottest topics within the pharmaceutical industry as the pharma industry is in a need to respond to a new regulatory landscape in the wake of Brexit. Since medicinal products are subjected to a highly regulated environment throughout their lifecycle, this derogation coming along with the UK’s withdrawal from the EU is expected to hit the pharma industry exceedingly hard, especially the pharma companies operating in the UK. 

What exactly is Brexit and why does it concern pharma companies? 

Brexit is an abbreviation for ‘British exit’, referring to the United Kingdom’s decision on June 23, 2016, to leave the European Union. Following this, the United Kingdom (UK) left the European Union (EU) on January 31, 2020, and became a third country. This will bring inevitable major changes to the way pharmaceuticals are tested, analyzed, and regulated within the UK and European markets. As quality and assurance methodologies are of pivotal importance in the field of medicine, pharmaceutical companies and drug manufacturers need to be doing all they can to ensure that the internal quality check standards are strong and flexible enough to withstand any challenges that Brexit may bring. So, it is of prime importance that the pharmaceutical companies have to prepare for the oncoming political changes while retaining high pharmaceutical product quality. 

Impact of Brexit on the pharmaceutical industry:

Following the exit of the UK, a transition period began on February 1, 2020, during which European Union (EU) pharmaceutical law remains applicable to the UK. But this is due to end on December 31, 2020. This means that pharmaceutical companies can carry out their activities in the UK until the end of 2020. The post-Brexit relationship between the UK and the EU are hard to predict and there are still many uncertainties on how the complete exit will look like and what the consequences are.

Rigorous quality assurance processes are crucial in the pharmaceutical industry because proper product testing can make the difference between life and death. While it is already made clear that the UK’s departure from the EU will remove the British drug market from the jurisdiction of the European Medicines Agency (EMA), the future relationship of the UK and EU is strongly dependent on how successful the negotiators will be in reaching a deal on the contractual framework outlining the guidelines of the future relationship, including the agreements on medicines and related regulations and procedures. 

The negotiation regarding the future relationship is likely to be concluded at the end of the transition period (December 31, 2020) and there is still hope that these negotiations may lead to mutual agreement and recognition related to many drug-related aspects. However, pharmaceutical companies must not undermine the risk of having a no-deal. So, it would be wise to start focusing on the key areas such as marketing authorizations and drug-related procedures, good manufacturing practice, clinical trials, quality of pharmaceutical products, and pharmacovigilance and be prepared for any outcome. 

Post-Brexit regulations concerning the pharma industry

In an attempt to keep the United Kingdom at the forefront of the life sciences industry in a post-Brexit world, the UK government has introduced the Medicines and Medical Devices Bill to Parliament. This sheds light on the powers in relation to medicines, clinical trials, and medical devices so that the current regulatory frameworks can be updated after Brexit. 

Regulation for medicines:

For medicines, the UK government may make minor changes to the process for applying for or holding a marketing authorization and exceptions for marketing authorization. The government may also make provision for authorizations for manufacturing, brokering, importing, and wholesale dealing of medicines, and for recording information about medicine supply, labeling, and packaging, advertising medicines, reporting adverse reactions, and guidelines for selling medicines online.

Regulation for clinical trials:

For clinical trials, the government may update the notification and reporting requirements need for clinical trials. Thus, they would become safer and less risky. They can also remove or make changes to the existing requirements for some clinical trials or all trials before they start so they remain proportionate. In addition to this, the government may also have provisions that correlate to the new EU Clinical Trial Regulations. 

Regulation for Medical devices:

For medical devices, the government may introduce requirements before a medical device can be put on the market and make provisions for packaging, labeling, registration, and performance evaluation for monitoring devices. 

What can pharmaceutical companies do right now to mitigate the risk?

There are certain things that the pharma companies can do right now to prepare for any of the Brexit outcomes. These companies should remain in contact with the relevant health authorities such as the European Medicines Agency (EMA) and Medicines and Healthcare products Regulatory Agency (MHRA) and be updated with the latest regulatory news. They can also form a Brexit strategic working group or task force with drug regulatory subject matter experts within the company and plan their strategies for a different outcome. Taking action proactively and sufficiently early is the key to minimize any risk for non-compliance and to ensure adequate preparedness. 

Brexit is surely amongst the biggest challenges for the pharma industry in the present age. Although we are nearing the end of the transition period, no agreement is in sight. But the Government is a clear commitment to maintain the United Kingdom’s life sciences industry in the post-Brexit world. So, a careful evaluation of the political situation and regulatory framework is essential for the pharma industry to respond to a new regulatory landscape in the wake of Brexit.

References:

  1. https://www.ema.europa.eu/en/about-us/brexit-united-kingdoms-withdrawal-european-union
  2. https://www.ema.europa.eu/en/news/procedural-guidance-help-pharma-companies-prepare-brexit
  3. https://www.ema.europa.eu/en/news/questions-answers-eu-actions-prevent-medicine-shortages-due-brexit
  4. https://services.parliament.uk/bills/2019-21/medicinesandmedicaldevices.html

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