EU pharma agency warns of post-Brexit levies


Medicines made in Britain will be treated as imports by the EU in the event of a “cliff­edge” Brexit and the life sciences sector will face a series of new regulatory obligations, the European Commission has warned.

A document issued jointly by the commission and the European Medicines Agency also states that UK companies could have to set up some operations related to drug safety and approval within the EU to ensure their products comply with European requirements.

Authorisation to sell a drug within the European Economic Area would have to be given by at least one member state’s regulatory body, it adds. The paper is a stark reminder of the disruption UK­based companies could face if Britain and the EU struggle to reach agreements on regulation of various sectors post­Brexit.

In response, the Association of the British Pharmaceutical Industry said setting up such new operations could take several years — adding to the pressure on Britain to negotiate a deal or a transitional agreement before the expected date of the UK’s exit from the EU on March 31, 2019.

At present the EMA — which will have to move out of its base in Canary Wharf in London after Brexit — authorizes medicines for sale across the EU. However, the 27 remaining EU states have made clear they are not prepared to allow the agency to remain on British soil after Brexit.

This has put regulation of life sciences in the UK among the key issues to be negotiated in the run­up to Brexit.

The paper also makes clear that in the event of no deal, substances used in the manufacture of medicines and the finished product will be considered imports if they originate from the UK. This raises the prospect of companies shifting manufacturing operations in an attempt to avoid any new import tariffs.

Industry leaders expressed concern that the document’s existence already assumed a worst­case scenario in which no agreement could be reached to harmonise regulations between the EMA and the UK.

Virginia Acha, executive director of the ABPI, said Brexit negotiations had yet to start “and their ultimate outcome is unknown, so it seems premature to advise companies to prepare only for an outcome where the UK is isolated from the European system”.

She added that, in an outcome where the UK was isolated from the European system for medicines regulation, “companies in the UK will have to consider all options for the location of sites, systems and staff, to meet the requirements of the EMA and other regulatory bodies”.

In particular, Britain’s lucrative generic medicines industry — copies of branded drugs — would be hit by the mooted treatment of finished medicines as imports.

Warwick Smith, director­general of the British Generic Manufacturers Association, said a single European regulatory system for medicines had generated “considerable benefits” for patients, the NHS and the industry. The association estimates that its copycat medicines save the health service about £13bn a year.

Mr Smith said his organisation had urged both sides in the Brexit negotiations to find a way of maintaining those benefits. He added: “It is concerning that the European Commission appears to be unwilling even to try to find a positive way forward in everyone’s interests, rather than assuming the worst outcome before the negotiations even begin.”

Underlining the extra bureaucracy with which the industry will have to contend if it cannot agree a future relationship with the EMA, the document says UK companies would have to find an authorised EU importer as part of quality and safety requirements.

Each company seeking to import medicines into the EU would have to establish a “batch control” site within a member state to confirm the drug had been manufactured in accordance with EU requirements, adds the document.

Companies would also have to establish “pharmacovigilance” teams in an EU member state, threatening hundreds of jobs currently based in the UK.

Jeremy Hunt, health secretary, told a select committee of MPs earlier this year, that mutual recognition could potentially be established between the EMA and the UK’s Medicines and Healthcare products Regulatory Agency. “I will be open to having the closest possible relationship on those things, but I cannot prejudge the negotiations,” he said.

Source: Financial times