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  1. Analysis
November 1, 2018

Implications of no-deal Brexit on access to medicines: industry representatives advise Lords committee

In the context of continuing failures to reach a Brexit deal and the UK Government publishing technical notices advising various sectors what to do in the event of no-deal Brexit scenario, the House of Lords EU home affairs sub-committee invited three representatives of the pharmaceutical industry to discuss and inform them about issues related to access to medicines if no agreement is made.

By Allie Nawrat

At a public meeting of the House of Lords select committee on the European Union, members of the home affairs sub-committee questioned pharmaceutical industry representatives about issues related to access to medicines in the event that the UK leaves the European Union (EU) in March 2019 without a deal.

This is because, in the words of committee chairman, Lord Jay of Ewleme, “this particular area [that] affects directly a lot of people, and therefore there will be a lot of concern about what the implications might be.”

Risk agency S&P Global Ratings declared following the Chancellor of the Exchequer Phillip Hammond’s budget speech on 29 October that the chances of a no-deal Brexit had increased and now have become a ‘relevant rating consideration’, as reported by the Financial Times.

The three industry representatives were Mark Dayan, policy and public affairs analyst at independent health think tank Nuffield Trust, secretary general of the British Association of European Pharmaceutical Distributors (BAEPD) Richard Freudenberg and Julian Maitland-Walker is a senior partner at law firm Maitland Walker LLP, who represents the BAEPD.

Not all products can be stockpiled

Freudenberg stated to the committee that he believes that the five to six weeks of supplies, in addition to their existing stocks, suggested by the UK Government’s technical notices and letters by Secretary of State for Health and Social Affairs Matt Hancock is reasonable for manufacturers.

However, there are logistical problems related to this which haven’t be dealt with.

For example, pharmaceutical products need to be stored in temperature controlled, fully licensed storage facilities. Dayan described the industry’s access to cold storage as an ‘unsettling issue’, as it is not quite at the level needed for stockpiling.

Freudenberg notes that dealing with the shortage of storage will involve a ‘regulated solution’ and resources from the Medicines and Healthcare products Regulatory Agency (MHRA) that doesn’t currently exist.

Freudenberg goes on to emphasise, however, that although six weeks of stockpiled drugs is possible for drug manufacturers, it is ‘very difficult’ for wholesalers, which make up BAEPD’s membership, to achieve. This is because ‘they absorb the excess in a given market of a particular products’.

There are also some products that cannot be stockpiled, including injectable products and those with short shelf lives. Dayan gave the example of biologic therapies, such as gene therapies; while Maitland-Walker discussed radiotherapy for cancer, of which 60% of UK requirements are imported from the EU, meaning 600,000 UK patients will be affected.

He sees these with short shelf lives as especially suffering from issues around the longer delays we are expected to see if a deal is not struck. Issues with staffing and technology are central to the issues with smooth running operations at the border.

Maitland-Walker sees the geography, in addition to logistics, as causing ‘knock on effects’ regarding trade in pharmaceuticals, even if the UK can resolve issues regarding exports of drugs.

Establishing the MHRA’s new role separate from the EMA

The House of Lords committee asked its expert panel about the new role of the MHRA as, following Brexit, the European Medicines Agency (EMA) will no longer be responsible for drug approvals and the receipt of Conformité Européene (CE) marks for the UK.

Dayan said that establishing the MHRA as a parallel organisation is a ‘major obstacle’.

Maitland-Walker told the committee that: ‘since the vast majority of new products are centrally authorised by the EMA, post-Brexit those EMA products…will not be authorised for the UK’.

The MHRA has not shared its plans on how it is going to authorise these products for the UK market; this is a serious issue for industry over the next five months. One option is that ‘the MHRA will simply give blanket authorisation…to the EMA licensing position’.

“That is alright from a transitional point of view, but in the long term a regulatory authority has got to regulate, not simply rubber stamp something from another regulator.”

When asked about are concerns that pharmaceutical companies will choose to not invest in getting a drug approved through the new UK system, Maitland-Walker said: “I think that is a fear that in terms of priority, if you have a choice between accessing the market with 250 million people and a market with 60 million, you are likely to go for the 250 million.”

He noted that, taking the example of Switzerland, studies have shown that it takes longer for new drugs to enter the market there than in the rest of the EU and the US. This is similar for Canada and Australia.

Consequences for public finances in event of no-deal

When asked what worried him most about a no-deal Brexit, Dayan responded the ‘long term effect on public finances and repercussions of that for the NHS’.

The government has estimated that it will cost £50bn a year by 2023, which is the majority of the current NHS budget. The increased cost of imported drugs is expected to be passed onto the NHS and consumers.

Maitland-Walker added that the exit of the UK from the EU will drive prices up, because competition with other EU countries will be eliminated. Dayan agreed commenting that the likely devaluation of the pound will also impact upon this.

This will be of a serious concern to pharmacies, especially in a context, as noted by Freudenberg, that the government is cutting their funding and reducing their numbers.

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