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Brexit would be bad for the pharmaceutical industry

Posted in General Health 08 Mar, 2016

Should we stay or should we go?

The Clash asked that question in their punk rock classic, and the British government is now asking the same. The Brexit public referendum is scheduled for June 23, only a few months away. The decision on whether or not the UK should remain in the EU will shape the future of both entities, and everyone who lives and works in them. The pharmaceutical industry is no exception. Industry executives, trade associations and university leaders have recently made their opinion clear: a British exit from the EU would be negative for the pharmaceutical industry and the wider life sciences sector.

Leaving EU Regulations Behind

As a highly regulated industry with close ties to EU legislation, pharma will be significantly affected by a Brexit. The European Federation of Pharmaceutical Industries and Associations (EFPIA), which includes major players like GlaxoSmithKline, AstraZeneca and Bayer, recently issued a statement saying that continued EU membership was the right move for a strong life sciences sector. The trade group BioIndustry Association (BIA) echoed this message in their recent Financial Times editorial. The 55 signees, all pharmaceutical executives, argued that leaving the EU would cause "disruption, expense, and significant regulatory burdens for a new authorisation system."

Losing access to the EU market – one of the largest single drug markets in the world – could potentially damage UK companies' drug sales, but more importantly would hinder the drug discovery process, which is primarily governed by EU regulation. One element of the EU regulatory framework is the European Medicines Agency (EMA), which approves medicines for all EU countries. Currently based in London, it might have to move to a new location if a Brexit occurs.

The UK's position within the European pharmaceutical sector would also have to be renegotiated. The UK would have to create its own separate regulatory system, but also continue to work within the EU system or risk completely losing access to that market. This could mean the UK would still be bound to the EU regulations but with much less input. Essentially, they'd still be playing the game but with no say in the rules.

Limiting the Flow of Money and Knowledge

Research and funding is another key issue. University leaders have been vocal on this, particularly in a recent Sunday Times letter signed by over 100 UK university leaders. They described the EU as playing a "vital" role in UK research and university education, and warned that an exit would damage this symbiotic relationship. Their views are echoed by other research scientists; according to a recent survey of over 400 research scientists, 93% see the EU as a "major benefit" to UK research.

Scientific collaboration between EU member states allows for more ambitious work to be accomplished. British scientists and universities currently play a major role in European research programmes and benefit from the free movement of intellectual talent, data and money. Many scientists fear that leaving the EU would reduce these ties and isolate British researchers, weakening the UK life sciences sector.

Scientists have also pointed out that the UK is one of the largest recipients of research funding in the EU. Between 2007 and 2013, the UK contributed £4.2 billion to EU research, but received £6.9 billion in EU research grants, showing a significant financial gain. Stella Creasy, Labour MP, has said that in the next four years alone, £8.5bn of EU science funding would be threatened by a Brexit.

Changes in Healthcare

Healthcare is another area that will suffer if the UK leaves, the industry argues. EU states manage their own healthcare systems on a national level, but EU law impacts certain aspects including doctors' working hours and qualification recognition. The EU also collaborates on important public health issues, such as anti-smoking and pandemic prevention.

Leaving the EU could also affect domestic drug access in the UK. With its EU market integration and its beneficial pricing approach, the UK attracts significant pharmaceutical investment. With an EU exit, the UK could become less of a priority drug launch market, especially if companies have to complete a separate UK approval process. This may disadvantage UK patients, reducing their access to new innovative treatments.

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