BREXIT - Life Sciences and Deal or No Deal

29th August 2018
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The UK is due to leave the EU on 29 March 2019 and, assuming an agreement is reached, there will be a transition or implementation period until 31 December 2020. The implementation period will give the UK and the EU additional time to negotiate any final arrangements for trade and rights to apply from 1 January 2021. During the implementation period, the UK will be required to comply with the EU rules and regulations.

UK government have recently published their guidance on what the implementation period will mean for the life sciences sector so that the sector can properly prepare for post 29 March 2019 trading. Until 29 March 2019, the UK remains a full member of the EU and all the rights and obligations of the EU remain in force.

UK government have also published notes on what will happen within the UK if there is no Brexit deal (commonly called a hard Brexit) and the UK leaves the EU on 29 March 2019 with no negotiated settlement which means no implementation period.

Position during the implementation period

The UK government guidance highlighted the following key points that will apply during the implementation period:

  • UK batch testing and Qualified Person certification in the UK will continue and be recognised by the EU, so that it will be “business as usual” for UK pharmaceutical firms

  • In relation to pharmacovigilance, marketing authorisation holders and qualified persons will continue to be able to be based in the UK and access EU markets. This means that UK pharma companies will not have to employ pharmacovigilance professionals in the EU. Mutual recognition of manufacturing and distribution licences (plus associated inspections) will continue.

  • For manufacturers, CE marking will continue to be used and recognised for medical devices in both the UK and EU markets. The testing by UK notified bodies for third-party conformity assessments in the UK will continue to be recognised for both the UK and EU markets.

  • The UK will continue to be treated as a Member State for the purposes of international agreements including Mutual Recognition Agreements so that there will be no disruption to existing international relationships during the implementation period.

Upcoming EU legislation

The new Clinical Trials Regulation (“CTR”) is expected to come into force in 2020 and will apply to the UK under the implementation period agreement. Even if the CTR is delayed, UK government has confirmed that UK law will remain aligned with the parts of the CTR legislation that are within the UK’s control.

The EU Medical Devices Regulation will fully apply from May 2020 and the UK government have announced that these regulations will fully apply to the UK.

No Brexit deal

If no deal is reached from 29 March 2019, the UK will have to regulate the life sciences industry within the UK. The implementation period will not apply. The EU will continue with its own regulations and UK exporters to the EU will have to comply with the EU regulations, including any regulations which require a place of business in the EU or the presence of the relevant “qualified person” for regulatory purposes.

The UK guidance notes on no Brexit deal state that the Medicines and Healthcare products Regulatory Agency (“MHRA”) will take on all the functions currently undertaken by the EU in relation to the market in the UK. In particular:

  • The UK will recognise CE-marked medical devices for use in the UK

  • In relation to clinical trials, the UK will align with the CTR where possible

  • In the case of medicines, all existing Centrally Authorised Products approved by the European Medicines Agency will be recognised in the UK. New medicines will require UK MHRA approval which will take EU decisions into account where possible.

  • Marketing Authorisation Holders (“MAH”) and Qualified Persons for Pharmacovigilance will have to be present in the UK from 1 January 2021 and will have to submit a Change of Residence application to the MHRA to change from an EU to a UK MAH.

What happens from 1 January 2021 if there is a Brexit deal or 29 March 2019 if no deal?

The honest answer is “Who knows”. You will have all seen the negotiations to agree a full implementation agreement by the end of October this year play out on the nightly news and newspapers, with differing views on the acceptability of the “Chequers” proposals.

In all likelihood, there is bound to be close co-operation between the UK and the EU from 1 January 2021 (or 29 March 2019 if there is no Brexit deal). Any UK exporters of medical devices will have to comply with any EU rules regarding CE markings and approvals. It remains to be seen whether UK companies will have to employ the relevant authorised representatives to sign off on the CE mark approvals within the EU.

The UK government announcement provides some measure of certainty until 31 December 2020 (assuming a Brexit deal is done), however, given that this date is little more than two years away it does not help UK based life sciences companies make their future investment decisions now.

If there is a no Brexit deal, the MHRA will take over all the functions currently carried on by the EU, so “taking back control” of the regulations of the UK life sciences industry. It would be surprising if no weight is given to the approval in the EU of medicines or medical devices after 29 March 2019 otherwise there is a risk of the MHRA being overwhelmed by regulatory applications.

For further information on Brexit and its impact on your business please contact any member of the Life Sciences team.

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