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What Will Happen to the UK Pharma Industry Post-Brexit?

 5 min read / 

Perception and reality are often two very different things. “The other man’s grass is always greener” is one expression of this concept, even immortalised in song. It also is common amongst politicians, especially those in opposition to the status quo.

Take the US Food and Drug Administration’s drug approval process. It is the conventional wisdom that the US takes too long to approve new drugs, harming pharmaceutical companies, investors and patients who might benefit, but compared to whom? The European Union is sometimes bandied about as a more commerce-friendly market than the US.

Rare Diseases

While campaigning for US President, Donald Trump said that the United States’ drug approval process through the Food and Drug Administration (FDA) was too slow. As an example, he cited a child with a niche disease, one that affects few people, so no pharmaceutical company thought it was worthwhile to work on a treatment or cure.

Entrepreneur John Crowley, the father of the child, started a pharmaceutical company to help develop such a treatment. It did, and in time to save her life. The public was told more such “miracles” were possible if the government reduced its “burdensome” regulations.

Since Trump’s inauguration, the FDA has reversed a decision on another rare disease treatment by Amicus Therapeutics, where Crowley is CEO. The FDA decided not to require another clinical trial before evaluating the drug. European regulators approved it last year, based on the same data submitted to FDA.

Actually, several companies were already working on a treatment. He did get them to communicate with each other and raise money privately for research and development. And the enzyme replacement therapy is not a cure but needs to be used repeatedly, at a cost of nearly $300,000 per patient per year.

Unintended Consequences

There is a movement in the US, Right To Try (RTT), to allow more terminally ill patients to try drugs that might help them, even if not yet approved by the FDA, so long as they have passed the first clinical trials.

At least 37 of the 50 states already have passed such laws, and they are pending in the other 13. A federal version of these laws has been proposed. The EU’s European Medicines Agency already allows “conditional marketing authorizations” for such unproven drugs.

One would not think Big Pharma would object to these laws, especially given their recent history with new opioid drugs, that it claimed were safer but has led to opioid pill addiction signs across the US and Europe. Less regulation would make drug approval easier and less expensive. But pharmaceutical companies, big and small, only have limited quantities of drugs available before final approval, and bad press could kill a drug prematurely.

Faster approval has been tried in the recent past. In the 1990s the FDA was encouraged to fast-track drugs to treat AIDS, but opening that sluice wider also led to hasty approval for at least seven non-lifesaving drugs, generating revenues of more than $5bn, that ended up causing more than 1,000 deaths.

US Drug Approval Is Faster

Gail A.Van Norman’s 2016 article “Drugs and Devices: Comparison of European and US. Approval Processes” found that while the FDA is often accused of “overplaying safety” compared to Europe, drugs (though possibly not devices) make it to the general public more quickly in the US than the EU.

In fact, drugs that were marketed in both the US and the EU were available in the US nearly three months earlier more than half the time. Between the US and Canada, they were available nearly a year earlier – a study published this year agreed: 306 days average overall in the US, 383 in the EU, at least for drugs treating cancers and blood diseases. According to Norman’s analysis, the reason was “consistently shorter review times at the FDA” than at the European Medicines Agency (EMA).

On the other hand, some drugs are approved first in Europe but then are rejected by the US. Sometimes the FDA and EMA come to different decisions about a drug’s safety despite receiving identical clinical data. And sometimes the FDA makes a “removal request” if an approved drug seems to have too many negative effects. Dublin-based Endo is withdrawing a drug it believes is safe – and had almost $160m in sales last year – rather than fight such an FDA “request.”

But in at least one area the EU has been stricter than the US: generic drugs. In 2015 the EU banned around 700 generic drugs manufactured in India after irregularities surfaced. The US did not see a problem.

Effects of Brexit

Despite these differences, the two markets both seem to have good approval systems in place. That the pharmaceutical companies have to jump through essentially the same hoops twice, spending many millions of dollars more, seems a little frustrating and needless. Now it may have to do it three times.

The European Medicines Agency (EMA), part of the EU, is currently located in London, but will have to relocate after Brexit. The EMA conducts the first stage in the drugs approval process, scientific assessment before the European Commission in Brussels decides whether to authorise it throughout the EU.

The pharmaceutical companies opposed Brexit for this reason: if the UK and EU have separate approval processes, the UK will be at the back of the line because the EU is the bigger market. Britain’s drugs may get approved later. Investment in UK drug development also may suffer. The UK would also have to do the work of more than 30 EU regulators unless some form of collaboration is maintained.

There could be drug shortages as well if Brexit is not orderly, and unless there is cooperation on regulations and supply chains between the newly divided continent and the UK. That could end up costing both money and lives.

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