What is the relevance of the EU-UK Trade and Cooperation Agreement for the life sciences sector?
Following four and a half years of often acrimonious negotiations and numerous build ups to a no-deal situation, the EU-UK TCA represents a positive step. While the deal is relatively thin and offers only discrete regulatory reciprocity, overall the TCA is a welcome development in the face of apparent near- political failure to agree on a way forward between the two sides. The life sciences sector has been preparing for no-deal amidst the global coronavirus (COVID-19) pandemic, throughout 2020, and having a deal, however slim, is positive for the sector in providing more fertile political ground for future harmonisation and cooperation
- What does the TCA provide for medicinal products with particular reference to:
- Does the TCA include specific provisions on medical devices and clinical trials?
- What are the other TCA measures of interest to the life sciences sector?
- What are the general implications of the Northern Ireland Protocol for the life sciences industry?
- The EU-UK joint committee on the NI protocol implementation have agreed on a phased approach on the application of the EU rules on supply of medicines in NI. This has been supplemented by MHRA and European Commission guidance – what does this approach involve?
- What are practical implications of the combined impact of the TCA and the Northern Ireland Protocol for life sciences businesses?
What does the TCA provide for medicinal products with particular reference to:
Cooperation of regulatory authorities and mutual recognition of GMP inspections
- The TCA includes an Annex on Medicinal Products that provides for mutual recognition of Good Manufacturing Practice (GMP) inspections and certificates. This Annex also foresees that the UK and EU authorities should seek to co-operate from a regulatory point of view, within the framework of the TCA, with specific mention of promoting the adoption and implementation of internationally agreed scientific or technical guidelines. Overall the TCA is quite thin on this point.
- Agreement failed to be reached with regard to mutual recognition of batch testing. The UK will continue to waive batch testing requirements for UK imports from the EU for products placed on the market before January 2023. However, the EU will not be reciprocating. The UK’s Association of the British Pharmaceutical Industry (ABPI) is lobbying for (i) both sides to agree a standalone Mutual Recognition Agreement (MRA) on batch testing and will be working with the EU’s European Federation of Pharmaceutical Industries and Associations (EFPIA) on this issue, and
- for the UK to unilaterally extend its batch testing waiver for EU imports pending such an MRA.
Working Group on Medicinal Products
- There will be a Working Group on Medicinal Products, established in accordance with the TCA’s governance structure, which will assist the Trade Specialised Committee on Technical Barriers to Trade. This is broadly worded and quite limited in terms of detail, which is likely to mean that years of committee work will be required to add more substance around this point.
Regulatory data protection
- The TCA requires that the UK and the EU must ensure that, for a limited period of time and under any terms to be determined by its domestic law, the authority responsible for the granting of an MA does not accept any subsequent application for an MA that relies on the results of pre-clinical tests or clinical trials submitted in the application to that authority for the first MA without the explicit consent of the holder of the first MA, unless international agreements to which the UK and the EU are both party provide otherwise.
- Similarly, each party must ensure that, for a limited period of time and under any terms to be determined by its domestic law, a medicinal product subsequently authorised by that authority on the basis of the results of the pre- clinical tests and clinical trials referred to above is not placed on the market without the explicit consent of the holder of the first MA, unless international agreements to which the Parties are both party provide otherwise.
- This is known as regulatory data protection and prevents clinical trial data being relied on by other parties to obtain a marketing authorisation. As mentioned, the particular terms and conditions for this are not included in the TCA but shall be determined in accordance with the relevant regime. There is no commitment from the parties to maintain common periods of protection.
Supplementary Protection Certificates
- The TCA sets out that the UK and the EU must provide a period of ‘further protection’ once the patent on a medicinal product has elapsed. This acts as compensation for the party having to undergo administrative authorisation procedures before their product is placed on the market. Provisions to nationalise the Supplementary Protection Certificates (SPC) regime have been put in place. The UK has enacted legislation to maintain the SPC system. No action is needed for SPCs that have already been granted, and applications filed before 1 January 2021 will continue unaffected save that, where a UK SPC application was based on a marketing authorisation (MA) granted by the European Medicines Agency (EMA), SPC holders may be asked to provide information on the converted UK authorisations. The duration of a UK SPC will be based on the date of the earliest MA in the UK or EEA. The six- month paediatric extension will also still be available.
Does the TCA include specific provisions on medical devices and clinical trials?
- The TCA does not provide specific provisions around medical devices, meaning that in order to place products on UK and EU markets, manufactures will have to navigate both regimes. Until 30 June 2023 the UK will accept CE marked medical devices provided they are registered with the Medicines and Healthcare products Regulatory Agency (MHRA) by the UK responsible person or the manufacturer. From 1 July 2023 all medical devices on the GB market must have undergone (re-)certification by UK Conformity Assessment Bodies to obtain their UKCA mark. There are around 600,000 medical devices on the EU market so the two-and-a-half year grace period currently set for this is likely to feel quite tight as the deadline approaches.
- The TCA does not mention clinical trials specifically, however the MHRA has published guidance on Registration and substantial amendments to clinical trials which took effect from 1 January 2021. This guidance does not address how existing approvals will be treated or whether the UK will bring its regulations in line with the EU Clinical Trials Regulation. We await further guidance being published to address these points.
What are the other TCA measures of interest to the life sciences sector?
Other key takeaways for the life sciences industry:
- The UK has agreed to stay a part of the Horizon Europe program, which provides funding for research and development; a decision that is particularly welcome for the life sciences sector.
- Hauliers are allowed unlimited trips between the UK and EU. There was some initial concern about possible shortages of medicines as hauliers avoid the Dover-Calais route to avoid customs delays.
- Under the TCA, goods which originate in either the UK or the EU will benefit from preferential treatment. This means that, as of 1 January 2021, pharmaceuticals and medical devices can move between the UK (with the exception of Northern Ireland (NI), for which there is a special regime) and EU without being subject to tariffs or tariff rate quotas as long as the relevant rules of origin are met. The assessment of origin can be a complex exercise especially in the case of medical devices and pharmaceutical products which are assembled from components and ingredients sourced from a number of different countries. Once origin is established, the proof of origin will need to be certified, either by an exporter declaration on the invoice, or a separate long-term supplier’s declaration. The TCA also allows the importer to self-certify the preferential origin of goods based on their own knowledge. There will be a transitional period until 31 December 2021, where proof of origin does not need to be provided at the border. Therefore, the impact of these changes is set to be staggered to alleviate the impact, but all the additional paperwork and the additional customs checks have the potential to increase costs and cause delays at the border.
What are the general implications of the Northern Ireland Protocol for the life sciences industry?
- Under the terms of the NI Protocol in the Withdrawal Agreement, NI remains subject to EU pharmaceutical and medical devices legislation. This means that the MHRA must now apply a different set of rules and standards in NI from the rest of the UK.
- In the case of medicines, applicants who wish to obtain an MA for the UK will also have to follow the EU procedures in respect of NI. This means that companies will need to obtain a double (EU and GB) MA in order to market a product across the UK. Effectively, there will be three types of MAs in the UK:
- MA that has effect in NI only
- MA that has effect in GB only
- MA that has effect across the UK (EU and GB authorisations)
- The European Commission and the EMA have issued guidance clarifying that UK products will continue to be part of union referral procedures in respect of NI. Similarly, NI will be taken into account when calculating prevalence for orphan designation, well-established use, sunset clause, etc.
- Given the uncertainties surrounding the NI Protocol in the context of medicines, on 5 November 2020 the EU and the UK agreed on a phased approach until 31 December 2021 for the implementation of the protocol in NI in areas such as batch testing, importation and Directive 2011/62/EU, the Falsified Medicines Directive or FMD.
- Ss regards medical devices, Regulation (EU) 2017/745, the EU Medical Devices Regulation (EU MDR) and Regulation (EU) 2017/746, the EU In Vitro Diagnostic Regulation (EU IVDR) will apply in NI from 26 May 2021 and 26 May 2022 respectively
- CE marking will be required for devices placed in NI and GB-based manufacturers will need to appoint an EU or NI-based Authorised Representative when placing devices on the NI market.
- The threat of a no deal scenario had raised in the last few months major concerns at the prospect of delays to vital medical supplies crossing the EU-UK border upon a no-deal Brexit. So far shortages are not seen to a significant extent for these essential products, largely thanks to industry’s impressive efforts to build up stockpiles and get products to NI before the end of the transition period. The situation is being closely monitored by all sides in these early days following the implementation of the new arrangements.
The EU-UK joint committee on the NI protocol implementation have agreed on a phased approach on the application of the EU rules on supply of medicines in NI. This has been supplemented by MHRA and European Commission guidance – what does this approach involve?
Under the terms of the NI Protocol in the Withdrawal Agreement, NI remains subject to EU pharmaceutical and medical devices legislation. This means that the MHRA must now apply a different set of rules and standards in NI from the rest of the UK. The EU and UK agreed on a phased approach until 31 December 2021, for the implementation of the NI Protocol in NI in areas such as batch testing, importation and the FMD. In summary, this means that medicinal products can be supplied from GB to NI without requiring additional regulatory importation controls (manufacture and import authorisation, batch testing and QP certification done in NI or an EU/EEA Member State) until 31 December 2021. As a consequence, wholesale dealers can continue to supply medicines from GB to NI for an additional 12 months from 1 January 2021. The unique identifiers on packs with an MA valid in NI (including UK- wide MAs) supplied by a manufacturer or wholesaler in the EEA will not require decommissioning when exported to the UK until 31 December 2021. Unique identifiers on these packs should be decommissioned in NI.
What are practical implications of the combined impact of the TCA and the Northern Ireland Protocol for life sciences businesses?
Hauliers are allowed unlimited trips between the UK and EU. There has been some concern with Hauliers avoiding the Dover-Calais route and taking potentially longer routes. There is likely to be a teething period while companies learn how to best navigate the new NI border and adjust their supply chains around this accordingly. While the UK has given importers a six-month grace period to prepare, the EU has not taken this approach.
A further practical impact is that the MHRA has to perform a dual rule and apply UK rules in GB and EU rules in NI. In turn, this means that companies operating across the UK (i.e. in GB and NI) will have to comply with both regimes. This is likely to be burdensome and may become problematic if the GB and EU rules diverge.
As mentioned above, in the case of medicines, applicants who wish to obtain an MA for the UK will also have to follow the EU procedures in respect of NI. This means that companies will need to obtain a double (EU and GB) MA in order to market a product across the UK.
Does the TCA allow further negotiations? What are the possible developments of interest to the sector?
There will be a Working Group on Medicinal Products – established in accordance with the TCA’s governance structure, which will assist the Trade Specialised Committee on Technical Barriers to Trade. This is a positive platform for creating future areas of reciprocity. The ABPI and the BioIndustry Association (BIA) have already begun lobbying for reciprocity on batch testing and regulatory cooperation more broadly, which is something that could be discussed by the new Working Group.
Interviewed by Anna Rylik.
For more information please contact Julia Gillert, Lilli Meldrum or Magda Tovar of our London office.