The Brexit Deal and the Life Sciences Sector

Cliodhna McDonough

Cliodhna McDonough is a life sciences lawyer at Fieldfisher.

On December 24, 2020, the UK finally agreed a Trade and Cooperation Agreement (TCA) with the EU. Cliodhna McDonough offers some initial thoughts on the implications of the TCA on the life sciences sector.

Back in 2016, the UK voted to leave the European Union (EU). After a painful four years of uncertainty, on December 24, 2020, the UK agreed a 1,250-page Trade and Cooperation Agreement (TCA) with the EU, which came into effect from January 1, 2021. While the life sector generally was relieved to have some certainty, below we break down the initial thoughts on the implications of the TCA on the sector.

For pharmaceutical and medical device companies, the TCA offers some regulatory provisions to smooth out trade between the EU and the UK; however, companies will face additional barriers that did not exist prior to the UK's departure from the EU. The two parties will now function as separate legal and regulatory jurisdictions, which means that distinct regulatory regimes for medicines and medical devices will now apply in the UK and the EU, and products must meet the relevant requirements for the market in which they will be sold.

While the Agreement includes an annex that specifically relates to medicinal products for human and veterinary use, medical device products are not specifically mentioned and many important regulatory and trade issues are unaddressed by the Agreement which remain open for future discussion.

The TCA does include limited provisions to facilitate trade by identifying and eliminating unnecessary technical barriers and to cooperate on international scientific and technical guidelines. Both parties are requested to base domestic technical regulations and inspection procedures on international standards as far as possible. Post market vigilance is likely to remain between the UK and the EU as the TCA provides that both parties shall cooperate and exchange information on product safety and compliance.

The TCA also allows UK researchers to remain eligible for European research funding despite the UK having left the European Union, which will bring much needed certainty for UK Scientists. The Agreement clears the way for the UK to take part in the EU’s 2021–2027 €95.5 billion research program, Horizon Europe, though the terms remain to be negotiated. The UK will also pay to continue its involvement with a handful of other EU research programs for example it will participate in nuclear research under the EURATOM treaty, despite having withdrawn from the treaty itself.

To help industry digest the agreement and make any remaining preparations, below is a summary of relevant TCA provisions for medicines and medical devices.

Medical devices

The Agreement notably lacks provisions for the mutual recognition of conformity assessment standards, which would have allowed EU member states to recognize certification by UK bodies to demonstrate compliance with EU standards. The outcome of this means products made in the UK will need to undergo an extra certification step to enter the EU market and device makers will need to navigate different regulatory regimes for the EU and UK.

For medical devices placed on the Great Britain market after the transition period, the MHRA introduced the UK Conformity Assessment (UKCA) marking on January 1, 2021, which will become mandatory starting July 1, 2023. Under the UK MDR 2002 (in the form in which they existed on January 1, 2021), a CE marked device with a valid declaration of conformity or certificate is viewed as meeting the UKCA mark requirements whilst the CE marking will be recognised in Great Britain until June 30, 2023. This includes devices placed on the market that are:

• CE marked in conformance with the EU MDD, EU IVDD or EU AIMDD

• CE marked in conformance with the EU MDR or EU IVDR.

While the UK, will continue to recognize CE marks until 2023, in contrast, the EU shall not recognize UKCA marking and certificates issued by UK Notified Bodies. UK Notified Bodies are not able to issue CE certificates other than for the purposes of the “CE UKNI” marking, which will be valid in Northern Ireland and have become UK Approved Bodies. NI goods must align with EU rather than UK product regulations.

In addition, the EU Medical Devices Regulation (EU MDR) and EU in vitro Diagnostic Medical Devices Regulation (EU IVDR) due to take effect across the EU in May 2021 will not be implemented in Great Britain. Currently, devices are regulated under the current EU MDD, these directives are given effect in UK law through the Medical Devices Regulations 2002 (SI 2002 No 618, as amended) (UK MDR 2002). These Regulations (in the form in which they existed on 1 January 2021) continue to have effect in Great Britain after the transition period and the regulatory regime for medical devices in Great Britain will continue to be based on the requirements derived from current EU legislation.

Authorized Representatives and Responsible Persons based in the EU will no longer be recognised in GB. They will need to be based in the UK for products being placed on the GB market.

Pharmaceuticals

The TCA does provide for the mutual recognition of good manufacturing practice (GMP) inspections of manufacturing facilities for medicinal products and is an example of an area in which the UK and EU have agreed to prevent the creation of a regulatory barrier to trade.

The Agreement Annex on medicinal products states the two parties “shall recognise inspections carried out by the other Party and shall accept official GMP documents issued by the other Party,” but allows regulators to reject official GMP documents under certain circumstances. Parties may also accept GMP documents issued by authorities of the other party for facilities located outside the issuing authority’s territory but have leeway to set their own terms and conditions for accepting such GMP documents. The agreement also reserves the rights of each party to conduct their own inspections of facilities that have been certified compliant by the other party, though they must notify the other party before conducting an inspection and the regulatory authority of the other party may join in on the inspection.

While the TCA did not achieve the mutual recognition for product batch testing the UK will accept batch testing and Qualified Person certification conducted in the European Economic Area (EEA) for a period of two years, until January 1, 2023. In contrast, the European Commission’s position is that the EU will not mutually recognize batch release and that a Qualified Person in the EEA must certify each batch of finished product before being released for placing on the market in the EEA.

While some of the new requirements are straightforward, some are complex and may be difficult to interpret for a specific set of circumstances.