On 31 May 2017, the European Commission and the European Medicines Agency (EMA) published a list of Q&A "related to the United Kingdom's withdrawal from the European Union with regard to the medicinal products for human and veterinary use within the framework of the Centralised Procedure" ("the Q&A document").
The Q&A document follows the notice to marketing authorisation holders of centrally authorised medicinal products for human and veterinary use that was published by the European Commission and the EMA on 2 May 2017.
In the notice of 2 May 2017, the European Commission and the EMA clarified that they expect marketing authorisation holders to proactively prepare for any changes resulting from the United Kingdom (UK)'s withdrawal from the European Union (EU). The Q&A document provides a first overview of the steps that marketing authorisation holders will be required to take (assuming that no other arrangements are put in place to apply from the date of Brexit).
A "worst case" scenario
The Q&A document is based on a "worst case" scenario, whereby the UK will no longer be considered a member state for the purposes of primary and secondary EU law from 30 March 2019 and will be considered by the EU to be a "third country".
The Q&A document suggests that the European Commission and EMA have reservations concerning the possibility that an agreement will be concluded between the EU and the UK in relation to the future regulatory position in the EU of medicinal products of UK origin. The Q&A document, therefore, encourages marketing authorization holders to adopt a cautious approach and to prepare for the worst case scenario. The document specifically provides that the legal consequences of Brexit "need to be considered in a timely manner".
Effects of Brexit on establishment requirements
This first set of Q&As concerns the establishment requirements that apply in the EU to marketing authorisation holders, orphan designation holders, qualified persons for pharmacovigilance (QPPVs), manufacturers and batch release sites with respect to medicinal products authorised in the EU through the centralised procedure.
Discussing medicinal products for human use, the Q&A document recalls that:
- Article 8.2 of the Community Code on Medicinal Products for Human Use requires that the holder of a marketing authorisation be established in the EU. The EEA Agreement extended the territory in which a marketing authorisation holder can be established to include the EEA countries (the EU Member States, plus Iceland Liechtenstein or Norway). In a Brexit "worst case" scenario, marketing authorisation holders established in the UK would be required to transfer their marketing authorisation to a holder established in a EEA country;
- Article 2 of Regulation (EC) No 141/2000 requires that the sponsor of an orphan medicinal product designation be established in the EU. The EEA Agreement extends the territory in which the sponsor may be established to include all EEA countries. Following Brexit, holders of orphan medicinal product designations established in the UK may be required to either, transfer this designation to a holder established in EEA or, to transfer their place of establishment to an EEA country;
- Article 8 of the Community Code on Medicinal Products for Human Use, requires that the QPPV for a medicinal product authorised in the EU reside in and carry out their tasks in the EU. The territory in which a QPPV may reside is extended to all EEA countries by the EEA Agreement. The Q&A document concludes that QPPVs currently residing and carrying out their tasks in the UK may be required to transfer their place of residence to an EEA country. Alternatively, marketing authorisation holders would be required to appoint new QPPVs residing and carrying out their tasks within the EEA;
- Commission Implementing Regulation (EU) No 520/2012 requires that the Pharmacovigilance System Master File (PSMF) be located within the EU. The territory in which a PSMF can be held is extended to all EEA countries by the EEA Agreement. Where the PSMF is presently located in the UK the related marketing authorisation holder will be required to transfer the PSMF to another EEA country;
- Where active substances are manufactured in sites located in the UK the requirements that apply to active substances imported from third countries into the EEA will apply. UK manufacturers and EEA importers will be required to demonstrate compliance with these requirements. In particular, pursuant to Article 46b(2) of the Community Code on Medicinal Products for Human Use, in a Brexit "worst case" scenario active substances manufactured in the UK could be imported into the EEA only if, among other things, the active substances are accompanied by a written confirmation from the Medicines and Healthcare Products Regulatory Agency ("MHRA") that the UK standards of GMP and control are equivalent to the EU GMP standards;
- Article 40(3) and Article 51(1)(b) of the Community Code on Medicinal Products for Human Use impose obligations concerning manufacturing sites and sites for batch release for EU finished products where these are manufactured in a third county. The EEA Agreement extends these obligations to include manufacturing sites and sites for batch release for finished products released into all EEA countries. The Q&A document discusses the implications of these provisions for the UK. In particular, marketing authorisation holders will be required to identify a related authorised importer established in the EEA and identify a site for batch control in the territory;
Urgent action needed?
The Financial Times has reported that the Association of the British Pharmaceutical Industry (ABPI) expressed concern that the Q&A document assumes a worst-case scenario in which no agreement could be reached to harmonise regulations between the EU and the UK. Virginia Acha, Executive Director of the ABPI, underlined that "it seems premature to advise companies to prepare only for an outcome where the UK is isolated from the EU regulatory regime".
According to an article in the UK's Telegraph, the EMA has since clarified its position and confirmed that these guidance notes only refer to the "worst case" scenario.
Our contacts in the EMA explain that the cautious approach of the Q&A document is due to the fact that the outcome of Brexit negotiations is yet unknown. It would be unacceptable, therefore, for the EMA and the European Commission to inform companies that an agreement or a transition period is expected when this cannot be guaranteed.
In addition, it is anticipated that a significant number of EMA employees (between 15% and 50%) may decide to leave the EMA following the decision of the relocation of the Agency, which will be taken in October 2017. The relocation of the Agency and the related impact on employees may, therefore, create substantial disruptions and delays in internal procedures.
The EMA, therefore, recommends that companies anticipate the potential consequences of Brexit and take steps as soon as possible to avoid delays in the procedures and disruptions to their activities.
This first Q&A document published by the European Commission and EMA specifically concerns establishment requirements within the EEA. The EMA is preparing a series of further guidance documents which will be published on the Agency’s website.
It is clear that businesses should already be analysing and planning for the potential outcomes of Brexit and preparing for next steps. With time to plan, businesses will be able to adjust to most scenarios. If change comes quickly, without time to plan, adaptation will be significantly more challenging. Reorganising legal entities, obtaining new authorisations, moving people and restructuring contracts take time; not to mention the changes to business and accounting systems these imply.