As the March 2019 exit deadline closes in, a panel at BIO Europe in Berlin discussed how the industry is navigating Brexit.
Free trade agreements typically start with barriers in place and the task is to break them down, remarked Lord James O’Shaughnessy, who serves as a UK Minister of Health for the Life Sciences and Brexit, in his opening speech. But at the time of Brexit, “we’re starting from a period in history where there are no regulatory barriers — we’re completely aligned. So what barriers do we put up?” He asked. “The UK has an opportunity to strike this unique sort of deal.”
This optimism was swiftly undercut by panelist John Haurum, the Danish CEO of the British bispecific antibody biotech F-star. “There’s a perception in England in the political sphere that this is a conversation that will start with equality,” he remarked. “That’s a fallacy that’s really quite concerning.” In his view (and that of most of Europe), the UK is on shaky ground to negotiate and any discussion will likely be harmed by this inflated sense of self.
Fellow panelist Aimad Torqui, the Director of Global Regulatory Policy for MSD, echoed this concern that the UK has a false sense of security. “You have to start considering this as a hard Brexit,” he said. “There is no deal.” This way, he said, the UK is safeguarded against a so-called “hard” Brexit and set up for a pleasant surprise if it’s “soft.”
For Torqui, “what’s keeping me awake at night is…when we have to start implementing changes and having discussions and explaining timings issues.” Because of regulatory hurdles, drug distribution could be delayed by a minimum of 150 days — but a commercially viable cell or gene therapy has to be turned around in a mere 30 days.
To illustrate the risks of a no-deal scenario, Haurum described how the markets would react to leave the UK behind. For instance, the country might see decreased access to new drugs. “The industry will choose the biggest market it can, why would it go to the UK first and then Europe?”
The hiring market is of particular concern to Haurum for his company, roughly half of whose employees don’t hold a UK passport. “We would have to move if we could only recruit from the UK: it just would not be feasible,” he said. As he described, it’s not about whether or not UK employees are good enough — biotech requires such a high degree of specialization as a high-risk industry that access to the largest possible pool of talent is essential for companies.
While Haurum admitted he “need[ed] to do a better job exhibiting his positive side,” he did find some reason for hope: the talent access issue can be solved unilaterally by the British government. Unsettlingly, the British government has yet to make any such move. “This isn’t satisfactory,” said Haurum. “We need to know that we can continue to recruit from outside the UK.”
It seems that for these reasons, UK biotech players are getting antsy as the Leave deadline of March 29th, 2019, inches closer. “These are ongoing discussions, not concrete results,” said Torqui. “Time is short already.”
Images from Author