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Brexit Impact on the Pharmaceutical Industry

08 Aug 2018

Brexit has resulted due the decision of the United Kingdom (UK) to separate from the European Union (EU). Brexit is formed by merging the words Britain and exit to get Brexit. On 23 June 2016, a referendum was done to decide whether the UK should leave or remain in the European Union. More than 30 million participated in this referendum, with 52% voting to leave.

Current state of Brexit

For this separation of UK from EU, pharmaceutical industry and regulators are preparing to manage and mitigate the potential risks which may pose due to this separation.

On 29th March 2017, Government of EU has only just triggered Article 50 but more than nine months on, the UK’s membership of the EU has not changed. Article 50 triggers the start of a two-year process of exit talks before the UK is expelled from the 28-member bloc. The use of Article 50 means that Britain will have left the EU by the end of March 2019.

At the DIA Annual Meeting, Medicines and Healthcare Products Regulatory Agency (MHRA) director said that regulators (EMA) are preparing to ensure the protection of public health, expertise, and business continuity along with the relocation of staff, their families, and IT systems to a different country. This exit will also lead to migration of nearly 900 highly skilled EMA staff from UK to Europe.

MHRA also stressed that many decisions are there which have not been made yet. But UK is not going to be doing completely different from the EU as it pertains to regulations.

MHRA is not only affected by this Brexit as Britain’s budget deficit in June stood at £6.8bn, 43% high as compared with the same month last year.

Impact on EMA

According to the statements by the head of international affairs and head of portfolio board, EMA, EU wants to maintain a good level of expertise as it prepares EU for the impact of the UK’s departure. The Committee for Medicinal Products for Human Use (CHMP) is the European Medicines Agency’s (EMA) committee which will be responsible for human medicines. The system is meant to safeguard the accuracy and validity of the Committee for Medicinal Products for Human Use (CHMP).

EMA and the European Commission published a document of questions-and-answers on 31st May 2017. Document was concerning the location of establishment of a company in the context of centralized procedures and certain activities, including the location of orphan designation holders, qualified persons for pharmacovigilance (QPPVs) and companies’ manufacturing and batch release sites.

Impact of Brexit on India

India’s biggest market for pharmaceutical exports is United States, whereas EU accounts for only 10-13% of total pharma export. UK’s share in India’s pharma exports is about 3-4%. This indicates that pharma companies do not really expect a big hit due to Brexit.

As the rules, regulations and product registrations are already different for UK and EU, any adverse impact on the sector can be ruled out.

UK has always acted as a gate pass for Indian companies to enter the European companies; this is more because of the access to financial markets in London and ease of doing business with Europe from UK, which can affect Indian pharma companies’ though it needs to be deeply analyzed.

Source: ficci.in; theguardian.com, outsourcing-pharma.com

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