In Chapter I of this blog series, I tackled some of the likely impacts of BREXIT on the prices of drugs to payers, the UK but also the wider network of connected markets in Europe and across the world.
Chapter II focussed on the likely impacts to the Launch Sequence of introducing new drugs to market, that is which countries are first, second… last in the order of launches, and thereby how this impacts patient access to new medicines.
In the final edition of this blog series, I will focus on the predicted impacts on Research, Manufacturing and Trade that many are expecting, some even before BREXIT negotiations and separation is finalized:
Research, Manufacturing and Trade
Science it is said “knows no borders” and as a discipline is proud to remain outside of politics, to be globally collaborative and unfettered in its search for scientific breakthroughs. Unfortunately, the nature of BREXIT will create some obstacles that even science will need to navigate. The UK is a research hub and enjoys large sums of EU funding for research. Scientists from almost every country in the world now work in the UK. The companies that run the research and develop these drugs set up their operations in the UK because of the favourable business and funding climate and of course the access to the cream of global intellect and experience in drug research.
This financial capital, funding and human capital is highly mobile and seeks (quite rightly) the best home to do its work and create better outcomes for humankind. The UK government will be all too aware that it can ill-afford losing leadership in this key sector and most expect that it will take extraordinary measures to reach a deal with the EU, to protect and grow by guaranteeing its “fair share” of funding for existing programs and even perhaps replacing lost funds, and finally assuring the “right to stay” for the immense migrant talent, as well as even strengthening fiscal incentives for investment in research operations on British soil.
However, one key issue that may struggle to get resolved is the sharing of health-related data across the 28 countries, particularly for rare diseases, which also helps pharma firms find cures. The deal breaker here being that these agreements will most certainly have to be under the European Court of Justice (ECJ) authority, which at this time seems to be a red-line in negotiations whatever the purpose.
Turning to manufacturing and trade: under current arrangements, drugs manufactured on the continent pass into the UK without custom checks, even medical isotopes that are regulated by EU nuclear agency Euratom. Drug supply chains are finely tuned and highly-optimized scientific processes. Disruptions or more seriously any unpredictability in the time it takes the product to enter the UK creates the risk of potential drug shortages or forces the pharma companies to add costs by increasing inventories locally and in the distribution chain. However, and most recently, guidance has been issued by the EU for pharma companies producing their product in the UK and wishing to export it to Europe. They are advised to relocate facilities including batching facilities, drug files and drug safety officers – to retain their existing rights to sell into the European common market. This is will be a significant cost for some to bear.
Negative for patients because disruption to research inevitably slows down rates of discovery.
Negative for manufacturers, potentially creating costs of relocation and re-establishing operations elsewhere. The trading/supply chain complexities might present the most difficult situations for some Generics manufacturers.
I invite you to watch this on-demand webinar proposed by Pfizer and Model N on “5 things global pricing leaders do to manage their prices globally”, which delivers a to-do list for guaranteed success in global pricing management.