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Trade

Drug stockpiling builds as Brexit approaches

Lack of EU-U.K. trade deal has companies scrambling

by Alex Scott
August 8, 2018

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Credit: C&EN/Shutterstock
The U.K. and EU’s failure to come together on a Brexit trade agreement is a major threat to the European and UK pharmaceuticals industry.

Negotiations between the U.K. and the European Union to adopt an open trade agreement ahead of Britain’s March 2019 exit—or Brexit—from the EU are going so badly, the pharmaceutical industry is stepping up its stockpiling of drugs in case trade is suspended.

Medicines in the EU are regulated—and licensed for use—by the European Medicines Agency (EMA), but the U.K. has been told by the EU that its testing procedures may not be recognized and that it may be excluded from the automatic licensing of U.K. medicines for use in the EU. As a result, come March 2019 the trading of medicines between the two parties could be temporarily halted.

The volume of pharmaceuticals traded between the EU and U.K. is substantial. About 45 million packs of medicine are exported from the U.K. to Europe each month, with 35 million per month imported from the EU into the U.K. Some 108 drugs are manufactured only in the U.K.

Sanofi, AstraZeneca, and Novartis, among other leading European pharma manufacturers, have disclosed that they are stockpiling pharmaceuticals so that they are available in the U.K. and EU. Typically, companies are stockpiling an additional four weeks of supply.

AstraZeneca has spent about $50 million preparing for a Brexit “no deal” and has a team of more than 30 working on its Brexit preparation. AstraZeneca has told the BBC that it intends to increase availability of its medicines by about 20% ahead of March 2019.

The U.K. government is encouraging this stockpiling. “We’re working with industry to prepare for the potential need for stockpiling in the event of a ‘no deal’ Brexit,” Matt Hancock, U.K. government secretary for health and social care, told a parliamentary committee in recent days. Hancock, who says he has met with pharma industry leaders to discuss Brexit, is encouraging the companies to stockpile across the medical supply chain for medicines as well as vaccines, medical devices, and clinical consumables.

In addition to the specter of Brexit, pharmaceutical companies across Europe face the introduction on February 9, 2019, of the EU’s Falsified Medicines Directive (FMD), which will require medicines sold in Europe to feature tamper-proof packaging that is traceable along the distribution chain. “FMD combined with Brexit in the space of a few weeks is a recipe for disaster,” a senior sales executive for a U.K. pharmaceuticals distributor, who chose to remain anonymous, tells C&EN. The executive says there is no indication yet that stockpiling among U.K. pharmacies is taking place but that there is an expectation that at some stage prior to Brexit some U.K. customers will buy “significantly more” medicines.

Meanwhile, EMA, which is moving to Amsterdam from London in March 2019 as a direct consequence of Brexit, is suspending many of its activities because about 30% of its 600 staff don’t want to relocate. Suspended or scaled-back activities at the agency include those relating to international collaboration, development and revision of guidelines, and programs relating to project governance.

EMA says it has initiated a comprehensive staff recruitment program. Despite its staffing issues, the organization’s core activities relating to the evaluation and supervision of medicines will continue at the level of quality and within the timelines expected, EMA claims.

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