Brexit and Beyond : New Borders Reshaping Pharma Regulations in Europe

Introduction

Brexit, the UK leaving the European Union (EU), has caused massive changes in all fronts and the pharma sector is one of the industries that have to bear the impact most seriously. The nature of regulation within the pharmaceuticals industry has shifted significantly thus posing challenges in this important sector. In particular, this blog is aimed at understanding the shifts in the regulatory process, relationship to EMA, drug approvals and market access following Brexit.

As geopolitical shifts reshape European borders, pharmaceutical regulations are evolving to meet new compliance demands. Each country within Europe has unique regulatory standards, affecting how medicines are approved, manufactured, and distributed across borders. This fragmentation has led to complex compliance landscapes, pushing pharmaceutical companies to adapt swiftly. As regulatory agencies reevaluate policies, there is an increasing focus on localized safety standards, import-export restrictions, and cross-border data sharing. Pharmaceutical companies operating in Europe must navigate these changes, aligning with evolving standards to ensure quality and safety while maintaining access to diverse European markets in a dynamic regulatory environment.

Overview of EU Pharmaceutical Regulations

Let’s explore the effect on pharmaceutical regulations within the EU as Brexit’s consequences. To protect the consumers, the EU adopted rules mainly based on Directive 2001/83/EC and Regulation (EC) no 726/2004 in order to maintain the efficacy and quality of drug products. EMA is highly responsible for assessing and overseeing medicines in the member states by using procedures such as centralized marketing authorization.

Brexit: Key Changes in the Regulatory Landscape

1. The End of Automatic Mutual Recognition

The most consequential result of Brexit is the termination of the principle of mutual recognition of the pharmaceutical licenses in the United Kingdom and the EU. Before Brexit, the marketing authorization issued in one Member State was approved and recognized throughout the EU. After Brexit, the UK has its regulatory system, so now the firms in the pharmaceutical sector have to deal with two procedures for authorization in both UK and EU.

• The European Medicines Agency (EMA) Relocation

After the Brexit result, the EMA was decided to be shifted from London to Amsterdam. This has implications for the agency and the pharma companies which it serves. ¹ This move does not affect the Board’s role in the centralized approval system for medicinal products intended for the EU market; however, the UK Medicines Healthcare Products Regulatory Agency (MHRA) now approves drugs in UK.

• Dual Regulatory Pathways

Companies in the pharmaceutical industry must follow two separate paths after the Brexit:-

• Marketing Authorization in the EU

Companies wishing to place their medicines on the EU market must submit a marketing authorization through the EMA or the member state concerned. The previous centralized procedure still continues to be the most effective procedure for those firms that wish to enter many EU markets. However, being a UK based company, the need to prepare different documentation and follow different set of rules to regulate the domain increases the overall costs.

• Marketing Authorization in the UK

Brexit has influenced the process of drug approval. Now, the pharmaceutical companies face two different regulatory bodies for the UK and for the EU. It implies that to sell the same products in both markets, the companies need separate marketing authorizations that results in higher costs.³

• Supply Chain Disruptions

Brexit has also affected the number of pharmaceutical products’ supply chain. The administrative need to obtain approval at a national level for each medicine means distribution has been hampered by time-consuming borders. Because of Brexit uncertainties, the pharmaceutical companies have had to put in place back-up strategies for maintaining the availability of medicines to their users both in EU and in the UK.

2. Challenges for Pharmaceutical Companies

• Increased Costs and Administrative Burden

This has caused costs in the manufacturing process to go up since the companies has to deal with two regulatory frameworks. It is costly to retain two sets of marketing authorizations, undertake different clinical trials where necessary and maintain two supply chains.

• Supply Chain Disruptions

Brexit has also affected supply chain or at least the processes that Great Britain has gone through in order to leave the EU. There is the need for companies to design their supply chain to address these disruptions and guarantee continuous delivery of medicines.

Opportunities in a New Regulatory Landscape

Besides challenges, Brexit has created new business opportunities for some pharma companies as well:

1.  Innovation in Regulatory Approaches: The measures that MHRA is taking with a view to promoting innovation could accelerate the introduction of new treatments in United Kingdom. Among the strategies that can achieve the objectives, flexible regulation and fast tracks will provide the UK an opening for new therapies.
2. Increased Focus on Market Access Strategies: As firms engage in this process, many are beginning to focus on constructing stronger forms of market access. This includes the interaction with the regulators at the development stage of a product and the use of real-world evidence in getting your products to the market.

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Future Outlook

Brexit has an implication on European Union pharmaceutical regulations but the long term effects are yet to emerge. Both the EU and UK are still likely to sort out their regulations in response to the industry, public health requirements, and advancing science.

• Potential for Harmonization

The EMA and the MHRA may have future collaboration prospects when it comes to taking decisions or actions. It is important that there is convergence between standards and processes and often, these discussions may lead to less time and effort that is spent on regulatory differences that exist between the two economies.

• Regulatory Divergence

The possibility of the onset of increased regulatory differences is also alarming. While the UK is going to establish its regulatory dominance independently, major divergences might emerge in the process. Organizations have to monitor changes in both locations to ensure they are ready to respond to changes as and when they occur.

Conclusion

Brexit has emerged as a significant triggering the changes of the pharmaceutical regulatory environment in Europe thereby posing challenges and offering opportunities to companies in the sector. Brexit has made matters complex in regulatory frameworks, product and services’ supply, and compliance to be more complicated. However, to overcome existing barriers or to have an opportunity to gain better access to markets, especially in the UK, some pharma industries may feel comfortable to change gears.