58 | ghp September 2016 Translation & Commercialisation Standing at the Brexit Crossroads – Considerations for Pharma Companies The most obvious issue affecting pharmaceutical businesses, post-Brexit, is what will happen to existing and future marketing authorisations in the UK and the EU, but other important considerations include the potential impact of Brexit on data exclusivity periods, orphan products, supplementary protection certificates (SPCs), and clinical trials. This article looks at some of the key issues facing the pharmaceutical industry and identifies the key areas which need to be addressed as the UK progresses towards Brexit. EU legislation and Brexit models Much of the legislation and regulation governing the sale of medicines in the UK at present comes from the EU (either as Directives, which have been implement- ed into national laws, or Regulations which are directly effective in all EU Member States and therefore do not require domestic implementation). In many cases where the UK decides to continue to implement EU legislation post-Brexit, it will need to agree with the EU some form of mutual recognition or equivalence re- gime in order to continue to be given access to rights set out in the EU legislation and for the EU to continue to recognise UK regulatory decisions. Various models of Brexit have been proposed - from ‘Brexit-lite’ in which the UK remains part of the single market (either via the EEA or otherwise) and retains legal provisions derived from relevant EU Regulations and Directives, all the way to a total separation, which would require significant repatriation of EU laws or al- ternatively the drafting of new national UK provisions. Dealing with existing and future approvals Depending on the terms of the UK’s withdrawal from the EU, Brexit may require companies to: • Transfer existing marketing authorisations (MAs) which rely on an establishment in the UK to an entity established in another EU Member State (whether to a new establishment of the same company, a group company, or a third party); • Change their approach to MA filings for new prod- ucts that will be launched in the UK and the rest of the EU (including considering the impact of Brexit on M&A deal structures where the transfer of MAs is required) and; • Undergo new good manufacturing practice (GMP) inspections for their manufacturing sites in the UK Clinical trials The Clinical Trials Regulation, which entered into force on 16 June 2014, is expected to apply across the EU before Brexit takes effect. The UK will need to decide whether to implement equivalent legislation in the UK post-Brexit. It would also need an agreement with the EU to continue to fully benefit from new Regulations, such as the multi-centre approval process. Activities performed in all clinical trials (and health technology assessments (HTAs) were exempted from patent infringement in the UK by the amendment of the UK’s ‘Bolar’ provision in 2014. Since this pro- vision is fully implemented into UK law (and heavily consulted on recently), the authors would not expect further changes to it, given the importance of being able to attract clinical trials to the UK. Businesses will also need to consider the wider validity of clinical trial data generated in the UK, post-Brexit, and analyse the use of, and ability to transfer, personal data to the UK which has been obtained through clinical trials in the EU. Data/market exclusivity The period of data/market exclusivity which applies once a new product has been authorised (the ‘8+2+1 rule’) derives from EU law and has been implemented in UK law. It seems likely that the UK will continue to protect developers of innovative medicines in this way, as part of ensuring the UK remains equally as attrac- tive as the remaining EU Member States. The UK may even see this as an opportunity to set itself apart from the rest of the EU by providing longer protection for innovators. However, this would need to be balanced against the NHS’s need to reduce the overall drug spend (which relies in part on generic entrants following the expiry of data/market exclusivity). UK legislators may also adopt a nuanced approach on issues such as exclu- sivity periods for new combinations, or indications, which may, in time, diverge from the EU’s approach. Specific EU legislation also applies to orphan drugs, which is designed to stimulate research and development of medicinal products for rare diseases only affecting a small percentage of the population (no more than 5 in 10,000 people within the EU). This orphan market exclusivity applies by virtue of a Following the June EU referendum in the UK, pharmaceutical businesses around the world are assessing what impact Brexit may have on their operations and business relationships in the UK, the EU, and internationally.