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Executive Summary

The assumption to date has been that the European Medicines Agency will have to move from its London base when the UK leaves the EU. But things may not be quite that simple.

EMA Post-Brexit - Pink Sheet - Pharma intelligence

UK prime minister Theresa May has said that the formal negotiation process that will lead to the UK leaving the EU will begin by the end of March 2017, meaning the country could be out of the trading bloc by April 2019. One of the many unknowns with regard to Brexit is just how the European Medicine Agency’s new home will be chosen – if indeed the agency has to move from London.

The EU treaties do not formally state that EU agencies must be located in an EU member state, but the assumption to date has been that post-Brexit the EMA will probably have to move from London to a city in another EU country. There is no shortage of candidates vying to host the EMA in this eventuality.

Not everyone wants the EMA to leave London, though. While there have been no public pronouncements, the UK government, the UK drug regulatory agency (the MHRA), UK-based universities and research institutions, large swathes of the pharmaceutical industry and the many service and support companies and organizations that have set up in and around London to be near the agency would undoubtedly be happy for the agency to stay… not to mention many of the EMA’s 890-strong staff. Outside the EU, Japan has said clearly that it would prefer the EMA to remain in London. Also see "Japan Wants EMA To Stay In UK Post-Brexit" - Pink Sheet, 13 Sep.2016.)

The Pink Sheet and its sister publication Scrip have heard suggestions that the EMA could perhaps have its headquarters in the EU while keeping its operations in the UK.
(Also see "Brexit: Issues and Opportunities As UK Life Sciences Define A New Relationship In Europe" - Scrip, 27 Sep.2016.) Objectively one might think that would be the sensible solution: a compromise that would mean minimal disruption to the staff and operations of the EMA. However, with national interests at stake, such a compromise may not be on the cards politically.

“It doesn’t only depend on the merit of the issue itself but on a lot of other issues.”

Anders Lönnberg, the life sciences coordinator for the Swedish government who spoke to the Pink Sheet on Sweden’s aspirations to host the EMA post-Brexit, is dismissive of speculation that the agency might stay where it is. “It can’t stay in the UK. I can’t possibly see that anyone would accept that you have an EU agency if you are not a member of the EU,” Lönnberg said.

“Informally I guess everyone has already said to the EU authorities that they are interested, then they will begin to compare, see what the individual countries have to offer, but finally it is the decision of the member state governments,” Lönnberg commented. And as he says, more is at stake than working out who is the best candidate. “It doesn’t only depend on the merit of the issue itself but on a lot of other issues.” Those issues will be as much political as anything else.

 

“Everybody Is Fighting”

Sweden, Ireland, France, Italy, Spain, Austria and Germany all reportedly want to host the EMA. (Also see "Dublin The Odds: Ireland Plays On Strengths As It Prepares EMA Bid"
- Pink Sheet, 23 Sep, 2016.) Also see "Swedes Explain Why They Should Have The EMA 'Gem' After Brexit" - Pink Sheet, 20 Sheet, 2016)

 Another EU agency, the European Banking Authority, is also based in London and former European Commission President Romano Prodi has spoken of the pressure that EU negotiators are coming under to make decisions on transferring key EU centers. “Everybody fights now to have the headquarters of the agencies that are now in the UK,” Prodi told
The Observer newspaper. “If you are a negotiator you have people pushing you. The governments, Italian, French. The cities are pushing you, saying: ‘my city is the best for pharmaceuticals in the world’. Britain is leaving a big heritage.”

 

Brexit A “Hammer Blow” For Pharma Industry

Norman Lamb, a former UK government minister, echoed Prodi. Other European countries were already “fighting over the spoils”, he said. The Observer reported Lamb as saying “Britain’s thriving pharmaceutical industry would be dealt a hammer blow through the loss of the European Medicines Agency, which is crucial for attracting foreign investment.”

Prodi seems to concur with Lamb on the impact of Brexit on foreign investment. He believes that while trade between Britain and the EU member states will not be greatly affected, it could result in a drop in foreign direct investment in the UK. “When it comes to the new headquarters of non-European countries – Chinese companies for their European branch, for example – a decreasing number of them will choose Britain,” he said. “In industry or manufacturing, the [Brexit vote] will in some way have less preference for the UK.”

There is no way of telling how things might go with regard to the EMA. Prodi, who was president of the commission between 1999 and 2004, believes the commission will take a tough stance in its negotiations with the UK. The Pink Sheet contacted the MHRA and several government departments for comment. The MHRA said it was it is “too early to speculate on the detail of any arrangements with the EMA”. Nonetheless, it is surely safe to say the UK government will fight hard to keep as much as it can of what has been called a “gem” among EU agencies.

UK Still “A Great Place” For Life Sciences

Meanwhile there have been several developments in the UK that the life sciences industry says reflect the fact that Britain remains a good place for the sector despite the uncertainty caused by the result of the June 23 referendum on whether to stay or remain in the EU.

One is the announcement that the government is to invest £220m into cutting edge new technology in the life sciences sector and towards university research. While not mentioning Brexit by name, Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry, said the announcement was “excellent news” and “a clear signal” from the government that the UK remained a great place for life sciences. The £220m will be used to help technology breakthroughs translate into commercial success. It is part of package of support for the life science and university sectors that will also include action to ensure disruptive businesses thrive in the UK.

There was also the opening last month by Alnylam Pharmaceuticals Inc. of a new development and commercial hub in the prime minister’s constituency of Maidenhead in the south of England. Steve Bates, chief executive of the UK BioIndustry Association, said this was “confirmation of the fundamental strengths of the UK life science ecosystem”. It was, Bates said, “fantastic news” for the UK that Boston-based Alnylam, which is developing novel therapeutics based on RNA interference, had chosen the UK for its new European HQ. 

Other industry figures have also been seeking to calm the waters following the shock referendum result. Eliot Forster, chief executive of Immunocore Ltd. and chair of the MedCity project that aims to foster a world-leading life sciences cluster in the south east of England, was among those attending a summit organized last month by the mayor of London to discuss how to best protect the UK life sciences sector in the aftermath of the referendum result. Forster said in advance of the summit: “While the UK’s decision to leave the EU has created political and economic uncertainties, I am confident that it does not change our position as a world-leading cluster for life sciences research and development. We continue to have outstanding research centers, a rich research ecosystem, globally recognized universities and hospitals and access to fantastic talent.”

From the editors of Scrip Regulatory Affairs

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