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How would Brexit affect the UK’s Life Sciences industry?

What seemed like an impossible scenario five years ago is now a very real possibility: Britain could actually exit from the EU.

With the referendum coming closer, the headlines are full of pros and cons. So what does Brexit mean for one of the UK’s high-tech, high growth sectors: the UK Life Sciences industry?

According to some of the biggest Pharma players in the world, such as Britain's GlaxoSmithKline and AstraZeneca, France's Sanofi and Germany's Bayer, it would threaten scientific research and jeopardize the European 28-nation bloc system of drug regulation.

The European Federation of Pharmaceutical Industries and Associations (EFPIA) said “Britain's continued EU membership was in the best interests of a strong life sciences sector both in the UK and across Europe”.

Scientists for EU warn that the effects of Brexit would be especially detrimental and will raise many questions:

  • The UK is home to many of Europe’s largest life science organizations, including the European Medicines Agency. If the largest organizations feel they have no choice but to relocate to elsewhere in the EU, might smaller organizations follow?
  • The UK is a major participant in cross-EU research programs such as Horizon 2020 and its predecessors. Would British life sciences companies still have access to these programs?
  • If industry leadership moves elsewhere in Europe, what will happen to the UK’s burgeoning life sciences start up sector?
  • UK businesses receive the third highest amount under the EU’s FP7 program. Would this funding be at risk?
  • Would restrictions on freedom of movement lead to skill shortages within the British Life Sciences sector?
  • The Pro Europa group points to the regulatory concerns Brexit poses. To what extent, for example, would the EU’s medicine regulations continue to apply to the UK?
  • What are the supply chain risks in a sector where every ingredient and component is regulated and scrutinized?

The precise nature of Brexit is still very uncertain; and uncertainty will be a business distraction and changing the current arrangement would lead to disruption, expense and significant regulatory burdens for a new authorisation system.

So what is your opinion? As always, I am very interested in hearing your thoughts.
 

Norma Warwick-Smith is Senior Consultant, Pharmaceuticals & Life Sciences at Interim Partners.

Comments

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David Brassington

03 Mar 2016 17:45 PM

You raise significant questions regarding the impact of Brexit on this sector, and this uncertainty is replicated across many other areas of commercial and public sector activity. The decision that is made on June 23rd will have far reaching consequences for the future of the UK and its population, but trying to find objective information on which an “undecided” individual can make a decision on which way to vote seems to be pretty much impossible!


Niall Fleming

02 Mar 2016 13:43 PM

Overall I do not believe it will harm existing and well established Life Sciences businesses that much if at all. Exit would put up more barriers for small and start up businesses however.

The effect of Brexit will be different depending on location. There is some evidence that UK governments tend to fund in the south more than the north, whereas the EU spreads rather wider.

Brexit is probably a bad thing, but we are sleepwalking into it at the moment.


Robert Todd

29 Feb 2016 19:31 PM

The leaders of big business and the political elite benefit from EU membership. Their self serving agenda is just that. Self serving. For the average British person exit is the way forward. There is no point is discussing the fine detail of your blog which in itself offered no counter argument to remaining.


Douglas Quigg

29 Feb 2016 18:20 PM

Norma,

You raise many good questions here.

I think that we have to face the fact that 26 miles from the UK coast the European continent exists and it represents a massive single market off which we are part. If we choose to leave, we leave behind unrestricted access and, whatever anyone might argue about new agreements that could possibly be reached, the psychology is we are are "out of it".

All the questions you raise around relocation, exemption from projects, fewer start ups in the UK, skills shortages, medicine regulations and scrutiny are very real risks. If UK businesses want to sell in Europe, even if we had no extra tariffs and freedom to do what we want here, we would still have to comply with European law and what would the attraction be to locate a new HQ or R&D facility here? I see to much anger being devoted to European which may have its flaws but no real vision for the future regarding what the UK plc business strategy will be in future if we were to Brexit. I'm looking forward to hearing the views of others.

Douglas