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- 07/14/2016

Worried and bewildered: Brexit sparks uncertainty for Indian pharma in Europe

Chimica Oggi-Chemistry Today

Indian companies in the UK are among many in the pharma industry facing an uncertain future after Britain voted to exit the single-market last week.

According to regulatory consultant and former Norwegian Medicines Agency auditor Anders Fuglsang, there is “extreme worry” among a number of Indian pharma companies following the UK’s decision to leave the European Union (EU) last week.

“As far as I can tell, Indian companies with HQs in the UK are bewildered,” he told in-Pharmatechnologist.com. “Until now they could often use their UK HQ for DCP/MRP-submissions to MHRA [the UK’s regulatory body] and get approvals across the EU.

“Right now they don’t know if UK will remain part of the approval system so a few of them are considering establishing country offices in other countries, for example in Germany in order to increase chances of ex-UK approvals.”

“Huge negative for business”

Drug and ingredient maker Granules India has its European headquarters in the UK to access the single-market, and European spokesman Mike Frude agreed the Brexit vote has left the firm under a cloud of uncertainty going forward.

“We’re still going to have a base here as we have large contracts in the UK but where the UK is going to sit within the EU is the big question for us going forward, especially as we look to develop our finished dose formulations in Europe,” he told us.

“It’s definitely easier for us and other Indian companies if we’re in the UK due to the language and British law,” he continued, but added the uncertainty of how the UK will now stand with Europe “is a huge negative and not good for business.”

Fellow Indian drugmaker Dr Reddy’s was more positive, with spokesman Calvin Printer telling us the firm “sees no significant impact for its business due to Brexit,” though the company currently has a strong European presence with offices in the Netherlands, Germany and Switzerland, as well as in the UK.

Cipla, which has both UK and Belgium subsidiaries, told us it “does not comment on political developments,” and a number of other Indian drugmakers did not reply when contacted about the situation.

While the UK public voted 52% in favour to leave the EU in last week’s referendum, the process will not begin until the Government triggers Article 50 of the Lisbon Treaty, which will then give the UK a two year window to negotiate its exit.

Big Pharma

Brexit may have sent shockwaves across the financial markets and currency exchanges, but Big Pharma is not too concerned for the moment

“Although the EU Referendum result creates uncertainty and potentially complexity for us in the future, we do not currently anticipate a material adverse impact on the business, Group’s results or financial position,” a spokesperson from the UK-headquartered pharma giant GSK told us.

“We will continue to operate as usual and will engage in the process ahead.”

Meanwhile, J&J, Amgen, Eli Lilly and Merck & Co. have all come out with statements along similar lines of it being too soon to know the full impact of Brexit, with any operational impact likely to be assessed in the coming months.

Regulators

But for Europe’s regulators, Brexit could pose a much greater problem as currently the European Medicines Agency (EMA) which manages drug approvals across all EU member states is located in London.

Following the referendum, the association of Germany’s pharmaceuticals industry called for the Agency to relocate, saying in a statement: “The administrative hurdles that we are now facing as a result of Great Britain’s exit from the Union will require great efforts on the part of our member companies.”

If the Agency does move, pharma could face a number of problems, according to business analysis group BMI Research.

“During this period of uncertainty and transition, regulatory delays will be highly likely,” analysts told us. “We note that this may reduce the attractiveness of the European pharmaceutical market for new product launches.”

But for now, the EMA is not going anywhere, according to comments sent to in-Pharmatechnologist.com from the Agency.

“The people in the UK have taken their vote and it is now up to the UK government to decide how to act upon the outcome of the referendum,” the Agency said.

“Article 50 of the Treaty on the Functioning of the EU foresees the procedure to be followed in case a Member States notifies the European Council of its decision to withdraw from the Union. No country has ever decided to leave the EU, so there is no precedent for this situation.”




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