How Brexit Impacts the Pharma Industry

The pharmaceutical industry is one of the most regulated industries in the world. When it comes to international trade, Mutual Recognition Agreements ensure the international harmonization of compliance standards and protect consumer safety. When the UK left the European Union, such an agreement for the biopharma industry was not yet in place. Instead, a provisional Trade and Cooperation Agreement, intended to solve the important matters was put in place. Read in this article about what the provisional agreement covered and did not cover and how the Medicines and Healthcare products Regulatory Agency responded to these challenges.

"A new relationship, with big changes": The EU Commission itself could not have expressed their current relationship better with the UK after Brexit. For several decades, there was a thriving trade between the British pharmaceutical industry and the European Union. While an average of 45 million pharmaceutical products were exported from the UK annually, around 37 million pharmaceutical products were imported from the EU to the UK in return. However, as of January 1st 2021, the UK has become a "third country" under EU law. A provisional Trade and Cooperation Agreement (TCA) put in place in December 2020 was intended to ensure that regulations are in place for key areas, but raised questions for the pharmaceutical industry in particular.

The TCA is not a Mutual Recognition Agreement (MRA), as many had hoped. The document defines a free trade agreement and covers other areas such as services, freight transport or professional qualifications. However, key issues for the pharma industry such as the mutual recognition of batch testing or the batch certification and release of medicinal products are not covered. This means that some regulatory activities including batch testing will no longer be recognized in the EU. From now on, when medical products are imported from the UK into the EU, batch certification must be carried out by an EU based Qualified Person (QP).

The fear of a legal void

By not having an MRA in place, there was a great risk of a legal void and disruption. For this reason, it was decided to maintain the regulatory framework for biopharma companies as retained EU law. An immediate consequence of this decision was to allow the Medicines and Healthcare products Regulatory Agency (MRHA) to function as the UK's standalone medicines regulator. A new MRHA guidance confirms, it will accept batch tests conducted in the European Economic Area (EEA) for a period of two years. The basic idea behind it: Avoiding a duplication of batch testing in the UK.

Since neither a mutual recognition of marketing authorization nor a transition period was agreed on in the TCA, the MRHA had to act here as well: Existing centrally authorized marketing authorities (MAs) were automatically converted to Great Britain MAs. The biopharmaceutical companies to which this regulation applies must submit their essential baseline data to the MRHA within one year and establish a legal presence in the UK by January 1st 2023.

What comes next?

The MRHA must now demonstrate that the agency is capable of making the UK a world leader in bioscience innovation despite Brexit. New regulations and programs rolled out by the MRHA focus on reducing the time for patient access to new medicines and technologies. The sooner such programs are implemented, the clearer the picture will be on how well the UK can do without the EU. However, it should not be forgotten that dealing with the ongoing coronavirus pandemic and its aftermath will also set the tone for the future success of the British pharmaceutical industry. 

Further reading on this topic

-  MRHA Guidance: Apply for a licence to market a medicine in the UK

- European Pharmaceutical Review: New regulatory landscape for biosimilars in the UK and EU post Brexit transition period