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Brexit Wobbles On, EMA Scales Back, 2019 Looms Large

John Lisman
Lisman Legal Life sciences


rexit and its impact on the life sciences industry remains an important topic until the final outcome of the UK-EU negotiations is clear. On July 12, Theresa May’s government published a white paper laying down the UK intention for the departure process from the EU. A very basic summary is that the UK wants to remain a special trade partner of the EU – developing a common comprehensive free trade area – keeping free movement of goods, but without the free movement of persons and the supremacy of the European Court of Justice over the British national courts and judges. To belong to the single market means that sharing of rules and regulations is required. To this end special common rulebooks will be developed and joint regulatory oversight should be organised.

This concept is generally seen as a “soft Brexit” by members of the Conservative Party, because it limits the “sovereignty” of the UK government and legislative bodies. Just after this white paper was published, Foreign Secretary Boris Johnson (one of the initiators of the Brexit vote) and the Brexit minister David Davis left Ms. May’s cabinet. This shows how divided the government and the Conservative party are with respect to the right way to exit the EU.

The white paper gives some insights into May’s ideas about the future of the markets for medical products. The Government’s vision is for an economic partnership that includes:

  • A common rulebook for goods including agri-food, covering only those rules necessary to provide for frictionless trade at the border; meaning that the UK would make an upfront choice to commit by treaty to ongoing harmonisation with the relevant EU rules, with all those rules legislated for by Parliament or the devolved legislatures.
  • Participation by the UK in those EU agencies that provide authorisations for goods in highly regulated sectors (namely, the European Chemicals Agency, the European Aviation Safety Agency, and the European Medicines Agency), accepting the rules of these agencies and contributing to their costs, under new arrangements which recognize that the UK will not be a Member State.

This means that the UK would accept current EU legislation, including its future amendments, for medicinal products and medical devices. Furthermore, the UK will continue to participate in the work of the EMA on a no-vote basis and to pay for its maintenance.

For the moment, the UK white paper is nothing more than a national proposal for further negotiations about the future UK-EU relationship. The odds do not favour the EU – the Commission and the member states –accepting free trade without applying the other principal pillars of the Union to the UK. Stakes are high and time to reach agreement is short; EU institutions require a decision about the future treaty within two months. If such an agreement is not reached in time, the “hard Brexit” wanted by many politicians will happen anyway. The consequences of this scenario cannot be predicted, but both the UK and the EU member states could lose a substantive part of their wealth.

EMA Move to Amsterdam

As of the Brexit date – 31 March 2019 – the EMA will no longer be located in London. The building on the Amsterdam Zuidas is progressing, but will not be ready until late fall 2019. In the meantime the temporary Spark building in Amsterdam Sloterdijk is prepared to house the EMA staff until the final site is ready.

EMA published an update about Brexit preparedness on 1 August. This update was necessary because it became clear that the Agency will lose more staff than initially anticipated. Staff who will not be willing to relocate to Amsterdam have already started to leave the Agency and this trend is expected to accelerate. In addition, due to the employment rules in the Netherlands, 135 short-term contract staff will no longer be able to work for EMA. Overall, EMA expects a staff loss of about 30 percent, with a high degree of uncertainty regarding mid-term staff retention.

As a consequence, changes have been made in the EMA business continuity plan. In phase 3, EMA will start to temporarily scale back or suspend certain activities until 2019. This protects EMA’s essential public health activities and allows for training of EMA staff who will be re-assigned to new duties ahead of the peak relocation time which will start in early 2019. Activities to be put on hold are:

  • International Collaborations, which will be temporarily scaled back to focus primarily on product-related requests, supply-chain integrity and procedures under Article 58; in other areas, such as the harmonisation of global medicine regulation, EMA will only take a reactive role; EMA’s engagement in other global public health issues such as antimicrobial resistance or vaccines will be maintained as long as possible, but reviewed on a case-by-case basis.
  • Development and revision of guidelines, which will be temporarily limited to those guidelines that address an urgent public/animal health need or are necessary to support and facilitate preparations for Brexit.
  • Meetings of non-product-related working parties, which will be temporarily reduced as a consequence of the scaling back of guideline development or revision.
  • Programmes and projects where activities in relation to project governance will be reduced in line with reduction/suspension of projects.
  • Organisation and attendance at stakeholder meetings, which will be limited to Brexit-related interactions.
  • Clinical data publication, for which the launch of new procedures will be temporarily suspended as of 1 August 2018; data packages submitted for medicines until the end of July 2018 will be processed and finalised.

Data Protection

25 May was an important day for privacy and data protection. On that day, the General Data Protection Regulation (GDPR) came into force, replacing data protection Directive 95/46/EC. In general, the GDRP did not really change how natural and legal persons must deal with their own and with each other’s privacy. The most significant changes are the obligation to document much better than before how data are being protected. Companies must inform data subjects more about privacy issues. Furthermore, most companies must establish Data Protection Officers to deal with personal data. Companies in third countries dealing with personal data are also required to have Data Protection Representatives. Finally, non-compliance with the GDRP may lead to extensive penalties. The impact on companies, following the regime of sanctions in the competition realm, is that non-compliance with the GDRP can lead to a fine up to € 20 million or up to 4 percent of the annual worldwide turnover of the preceding financial year, whichever is greater.