By Yulia Privolnev, Global Market Access Insights, Decision Resources Group (DRG)
On December 4, U.K.’s Business, Energy and Industrial Strategy (BEIS) parliamentary committee announced it was investigating the implications of Brexit for the U.K.’s pharmaceutical market, amidst fears Brexit will threaten "the cost of medicines, investment in the United Kingdom and access to new and innovative research and products." The committee has solicited advice from numerous sectors and the public. Their goal is to make recommendations on what the government should hope to achieve from the ongoing Brexit negotiations when it comes to the pharmaceutical industry.
The announcement could not have come at a better time for the industry, as events over the last few weeks have made it clear that while Brexit and its resulting practicalities were becoming all the more real, attempts to address the uncertainty for the pharmaceutical industry are still in their infancy.
EMA Headquarters Moving To Amsterdam
As I wrote about previously, November 20 was a big day for the European Medicines Agency (EMA) and its future headquarters. The complex voting rounds ultimately resulted in a draw between Amsterdam and Milan, despite Milan leading all of the previous rounds. The winner ultimately was decided through a random draw — with a name chosen out of a plastic bowl, no less. However, plastic bowls aside, the result can certainly be seen as a victory for the industry, and for the agency.
In September, the EMA released the results of a survey in which they asked staff to provide their opinions on the 19 cities in contention to host the EMA, in an effort to determine how staff retention would be affected by the move. Amsterdam was the top choice among staff, followed by Barcelona, Vienna, Milan, and Copenhagen.
Based on low staff retention, the EMA warned that a move to any of the lower-ranked cities would mean the agency could no longer function, meaning no new medicines could be authorized for a significant time period. The EU would have to rely on medicines imported and approved from companies and agencies in other countries, such as the U.S.
The best case, which is what ultimately happened, will still likely cause some retention issues compared with remaining in London. However, by moving to a highly ranked city, the EMA will be able to maintain most of its critical functions, with some delays. It will take three years to recover full function.
The transition officially began the day after the vote and will be completed by March 30, 2019. Starting in mid-December 2017, manufacturers — and the public — will be able to track the progress of the transition on a special link on the EMA's website.
Overall, as a result of the vote, the move is less likely to lead to significant delays for authorization and an erosion of public trust in the agency. However, from the U.K.’s and manufacturers’ perspectives, it is still unclear how the country’s Medicines and Healthcare products Regulatory Agency (MHRA) will interact with the EMA and what this means for the U.K.'s pharmaceutical market.
The U.K. Parliament Issues Brexit Briefing
While the European Council was voting on where to move the EMA headquarters, the U.K. Parliament issued a briefing paper on the ramifications of Brexit on the regulation of medicines. Although not an official position paper, the briefing does present options for future medicine regulations in the U.K., as well as the impact on resources and workload for the MHRA if the U.K. is no longer involved with European-level medicine regulations. The EMA has worked more closely with the MHRA than with any other EU member state's national regulatory agency, in part because of the geographic proximity of the two agencies. It has been estimated the MHRA led around 25 percent of new EU medicine assessments, with 20 percent of the EU’s scientific work carried out by experts from the U.K. Clearly, the EMA and EU member states will not be spared negative repercussions from Brexit.
Ultimately, the briefing did not elaborate on the degree to which the MHRA will continue to work with the EMA following Brexit, a detail which will be decided during the withdrawal negotiations. However, the briefing did emphasize the government’s favorite talking point about continuing close cooperation, such as through a mutual recognition agreement.
The briefing also discussed potential changes that will be required on the national level in the U.K., in part to keep the market competitive and attractive for developers and manufacturers. Such changes include expediting the licensing process to make it faster than the EMA’s and even having the MHRA and the National Institute for Health and Care Excellence (NICE) assess new drugs in a parallel process that could potentially speed up time to market for manufacturers.
This briefing, combined with the BEIS committee inquiry discussed earlier, will play an important role in informing the U.K.’s negotiating strategy when it comes to Brexit and medicines.
EMA Offers New Guidance On Preparing For Brexit
Not to be outdone, a week after the fateful vote and the U.K. Parliament’s briefing document, the EMA released procedural guidance to help manufacturers prepare for Brexit, updating their guidance from earlier in the year.
Overall, the guidance focuses on the March 30, 2019, deadline for Brexit, summarizing what will and will not be appropriate for manufacturers after that deadline. For example, bioequivalence studies conducted with a medicinal product sourced in the U.K. can be used in generic or hybrid marketing authorization applications only if the marketing authorization is granted before March 30, 2019.
In relieving news for industry, the guidance does clarify that data sourced from the U.K. while it was an EU member state can be taken into account to demonstrate efficacy and safety. However, for orphan designation applications submitted after March 29, 2019, U.K. patients should no longer be taken into account when calculating the prevalence of a disease.
Overall, the guidelines were not unexpected. Effectively, after March 29, 2019, the U.K. will become obsolete in applications to the EMA. It should be noted, however, that the EMA is operating under the assumption the U.K. will become a “third country” — the term used by the guidance to describe countries that are not members of the European Union or the European Economic Area — as of March 30, 2019, and that could change, dependent on negotiations. While this may clarify the practicalities for manufacturers, it may not help alleviate the fear of the unknown, as the industry — and these countries — go barreling toward a still-undefined new reality for medicines in Europe.
On December 4, reports emerged from the Brexit negotiations that encouraging progress has been made and the U.K. and the EU have come close to agreement on a number of big issues. This is a boon for pharma, as the clock is ticking. Prime Minister Theresa May must secure a deal ahead of a summit with EU leaders later this month in order to progress to trade talks, and the pharmaceutical industry is growing increasingly concerned there will be insufficient time to iron out regulatory and trade concerns before the official “divorce” date.
In fact, associations representing the European and British life sciences industry (AESGP, EFPIA, EuropaBio, EUCOPE, Medicines for Europe, ABPI, BGMA, BIA, and PAGB) went so far as to issue a joint statement at the end of November, urging negotiators to treat the pharmaceutical sector as a special case and begin relevant negotiations as soon as possible. In response, the U.K. is expected to offer a special sector deal later in December in an attempt to mitigate the Brexit blow.
However, many of the bigger questions will remain for industry. Namely, will they have to treat the U.K. as an entirely separate market? Will they have to reprioritize launch sequences? Or even something as basic as, will the EMA and MHRA continue to work together? A bad deal could mean the U.K. will be downgraded to a second-tier market, not something likely to satisfy the U.K. or the industry. With a lot at stake, manufacturers must prepare for all possible scenarios and enjoy the wins and good news as they come.
About The Author:
Yulia Privolnev is a principal analyst on the Global Market Access Insights team at Decision Resources Group (DRG). She is responsible for monitoring, analyzing, and reporting on global market access through the production of DRG’s Global Market Access Solution (GMAS) and Access & Reimbursement (A&R) products. Privolnev's specific focus is on all aspects of market access in Western and Eastern Europe, as well as international reference pricing (IRP) and managed entry agreements (MEAs) on a global scale