The Great British Exit

The UK’s referendum on its European Union membership have sent shockwaves across the globe after 51.9 percent of voters (17,410,742 people) backed “leave”. The result has led the country’s Prime Minister, David Cameron – who campaigned for the UK to remain in the EU – to resign and the value of the pound to drop to its lowest levels since 1985.

No country has ever withdrawn from the EU before and discussions are ongoing as to what exactly will happen next. The UK government must now decide when to invoke Article 50 of the Treaty on EU, which sets in motion the divorce proceedings. After that, there will be a negotiation period of 2 years during which time the UK and the EU will establish a new relationship. In a joint statement (1), the five presidents of the EU, confirmed that, “until this process of negotiations is over, the United Kingdom remains a member of the European Union, with all the rights and obligations that derive from this”.

The impact of the referendum on science and the pharma industry is currently unclear, but there will certainly be profound implications for trade – some of which were discussed in the May cover feature of The Medicine Maker (https://themedicinemaker.com/issues/0516/the-great-british-debate/). Will the UK remain a member of the single market like Norway? Could it agree something akin to the Swiss model – based on a series of bilateral free trade agreements? Or would it revert back to World Trade Organization rules, and endure the reintroductions of tariffs? The fate of the European Medicines Agency also looms large as EU rules dictate that it must be located in an EU member state. Martin Zentgraf, head of the German Pharmaceutical Association has stated that the EMA must relocate from London (2)

Prior to the referendum, a number of stakeholders in the pharma industry had highlighted the benefits of the UK remaining a member of the EU. For example, the European Federation of Pharmaceutical Industries and Associations (EFPIA), issued a statement in February explaining that “as part of the EU, UK pharmaceutical companies can continue to benefit from pan-European collaborations in research and development, the EU marketplace, EU advocacy on global trade issues and a harmonized regulatory environment.” (3)

In light of the result, EFPIA has released a very short statement to emphasize that it will continue to ensure that patients are at the center of all decisions and to work with stakeholders in Europe, including the UK (4). “EFPIA shares the common goal of ensuring rapid access to innovative medicines for patients across Europe, as well developing a regulatory and policy environment that fosters innovation and supports the research and development of new medicines to meet the needs of patients, healthcare systems and society. As an industry, over the coming months, we are committed to engaging with stakeholders both in Europe and in the UK to support these objectives.”

Meanwhile, Steve Bates, Chief Executive of the the BioIndustry Association (BIA) said, “This is not the outcome that the BIA wanted but we accept the views of the UK people. The life sciences sector is a resilient community, unfazed by new challenges and staffed by great management teams used to working in a global environment.” (5)

However, he also added that there are a number of questions that need to be answered concerning the regulation of medicine, access to the single market and talent, intellectual property and the precise nature of the future relationship of the UK with Europe.