1.The UK’s withdrawal from the European Union—“Brexit”—will affect many aspects of the provision of health and social care in the United Kingdom. This report is the second phase of our work on Brexit, Given the range and complexity of the questions associated with the impact of Brexit on health and social care, our predecessor Health Committee in the last Parliament focused the first phase of its inquiry on the immediate issues faced by people, including the health and social care workforce as well as citizens who rely on reciprocal healthcare arrangements. Their report, and the Government response to it, can be found on our website.
2.This second phase of the work of the Health and Social Care Committee on Brexit focuses on issues relating to medicines, medical devices and substances of human origin. On the basis of the written evidence we received and expert advice provided to us, we identified seven broad areas which have been the focus of our inquiry:
3.Already published on our website is a letter that we have sent to the Secretary of State for Health and Social Care regarding the urgent need for clarification from the UK Government on the details of a transitional period following the UK’s official departure from the EU on 29th March 2019. This letter made the arguments that:
4.We will be evaluating the Government’s response to our letter seeking clarity about the details of a transition period and contingency planning in the event of ‘no deal’, and expect this to be included within the response to this report.
5.At the outset of this report, we reiterate the conclusion of our predecessors regarding contingency planning:
Giving evidence on the impact of Brexit, Jeremy Hunt MP, the Secretary of State for Health, told us that the Government would not be publishing its own digest of the implications of Brexit because “the publication of what might be called the worst-case scenario could itself have an impact on negotiations.” We do, however, urge the Department of Health to produce a comprehensive list of those issues that will require contingency planning.
6.Far from undermining the UK’s negotiating position, we consider that clarity about contingency planning is necessary to guarantee patient safety and continued health supplies. There are implications for research and development, safety and supply chains for people and health systems both here and across the EU-27. We believe that it is important that both sides acknowledge this and remain firmly focused on the needs and safety of patients. The European Medicines Agency (EMA) has published its guidance on what is necessary for the UK to maintain continued access to medicines in a ‘no deal’ scenario, and we believe that this one-sided picture may harm public confidence if it is not possible to compare it to the Government’s planned approach. We recommend that the Department of Health and Social Care produce a comprehensive list of all the issues relating to the supply of medicines, medical devices and substances of human origin which require contingency planning for the UK leaving the EU. We expect to see evidence that plans are in place to address identified risks to patients.
7.Although the World Trade Organisation (WTO) sets basic rules around trade, in practice trade agreements between groups of countries go further in eliminating barriers. In particular, although tariffs on pharmaceuticals are largely eliminated at global level, there are widely diverging non-tariff barriers, such as the licensing regimes of different countries. The EU currently has two key existing models of trade with other countries, which demand different forms of regulatory alignment and jurisdictions:
8.The European Economic Area (EEA) is a free trade agreement that extends the Internal Market of the EU to the three participating EFTA States, giving Norway full access to the single market (without a voice in the decision-making of bodies such as the EMA, but with a separate EEA/European Free Trade Agreement (EFTA) court), but which is not inside the customs union, meaning customs processing is still needed. Norway is an associated country for a variety of European research programmes including Horizon 2020, meaning it pays a financial contribution, and Norwegian researchers can take part in activities and receive grants.
9.The free trade agreement with Canada is not focused on the external party adopting the EU’s legislation, but rather on mutual recognition of each other’s standards where possible. This also means that it does not provide the same degree of market integration as Norway has–though by the standards of trade agreements it is wide-ranging and includes a high degree of alignment. It includes some provisions that are particularly relevant to this inquiry. For intellectual property, the agreement obliges Canada to put in place additional protections similar to the EU. It also includes mutual recognition of each other’s standards and certification bodies; this in principle could mean mutual recognition of authorisations for medical devices, but they are currently excluded, though a priority for future inclusion. It sets a framework for mutual recognition of professional qualifications; which again, in principle could apply to the health professions, though actual recognition depends on specific agreements yet to be negotiated. It also includes mutual recognition of oversight of good manufacturing practice (so manufacturing checks do not have to be duplicated). Canada is not associated to the EU’s research programmes.
10.We heard that from the perspective of the European Commission, the future UK-EU relationship will be one which is grounded in the principles of one of these different relationships. In 2017 Michel Barnier, the EU’s chief negotiator, argued that the UK could choose between the ‘Canada’ or ‘Norway’ model, but that any trade relationship with the UK after Brexit would necessarily be one of these two models. There would be no place for a new relationship to be drawn up, so the UK could choose between one of these existing models, or face no trade deal at all. This was, apparently, reaffirmed by the draft text of the European Council’s negotiating position which was published on 7th March, which stated that:
A non-member of the Union, that does not live up to the same obligations as a member, cannot have the same rights and enjoy the same benefits as a member. The European Council recalls that the four freedoms of the Single Market are indivisible and that there can be no “cherry picking” through participation based on a sector-by-sector approach, that would undermine the integrity and proper functioning of the Single Market. The European Council further reiterates that the Union will preserve its autonomy as regards its decision-making, which excludes participation of the United Kingdom as a third-country to EU Institutions, agencies or bodies. The role of the Court of Justice of the European Union will also be fully respected. As regards the core of the economic relationship, the European Council confirms its readiness to initiate work towards a free trade agreement (FTA), to be finalised and concluded once the UK is no longer a Member State. Such an agreement cannot offer the same benefits as Membership and cannot amount to participation in the Single Market or parts thereof.
11.In contrast, the UK Government has been clear that it wants neither Canada nor Norway as a model for a future trade relationship with the EU. The Prime Minister in her Mansion House speech on 2nd March argued:
… The existing models for economic partnership either do not deliver the ambition we need or impose unsustainable constraints on our democracy.
For example, the Norway model, where we would stay in the single market, would mean having to implement new EU legislation automatically and in its entirety - and would also mean continued free movement.
Others have suggested we negotiate a free trade agreement similar to that which Canada has recently negotiated with the EU - or trade on World Trade Organisation terms.
But these options would mean a significant reduction in our access to each other’s markets compared to that which we currently enjoy.
And this would mean customs and regulatory checks at the border that would damage the integrated supply chains that our industries depend on and be inconsistent with the commitments that both we and the EU have made in respect of Northern Ireland.
12.The Prime Minister instead set out the relationship which she will be looking to secure with the EU as one which is “tailored to the needs of our economies”:
This follows the approach the EU has taken with its trade agreements in the past - and indeed with its own single market as it has developed. The EU’s agreement with Ukraine sees it align with the EU in some areas but not others. The EU’s agreement with South Korea contains provisions to recognise each other’s approvals for new car models, whereas their agreement with Canada does not. Equally, the EU’s agreement with Canada contains provisions to recognise each other’s testing on machinery; its agreement with South Korea does not. The EU itself is rightly taking a tailored approach in what it is seeking with the UK. For example, on fisheries, the Commission has been clear that no precedents exist for the sort of access it wants from the UK. The fact is that every Free Trade Agreement has varying market access depending on the respective interests of the countries involved. If this is cherry-picking, then every trade arrangement is cherry-picking. Moreover, with all its neighbours the EU has varying levels of access to the Single Market, depending on the obligations those neighbours are willing to undertake. What would be cherry-picking would be if we were to seek a deal where our rights and obligations were not held in balance. And I have been categorically clear that is not what we are going to do.
13.While we would be keen to see this relationship materialise between the EU and the UK, we note that it appears to run contrary to certain positions which have previously been outlined by the EU.
14.Initially, while the Government states that ‘cherry picking’ would involve seeking a “deal where our rights and obligations were not held in balance”, the specifics of the obligations which the UK is willing to accept are not clear. The EU and UK do not appear to agree on where this “balance” between rights and obligations lies and subsequent statements suggest ongoing resistance from the EU to sector by sector deals. The Prime Minister noted however, that “The EU itself is rightly taking a tailored approach in what it is seeking with the UK. For example, on fisheries, the Commission has been clear that no precedents exist for the sort of access it wants from the UK.”. After the Prime Minister’s speech, some commentators were already reporting a confidential European Commission assessment EU circulated to diplomats from EU states which claimed her Mansion House speech amounted to “double cherry-picking” with “no change in substance” from her government’s previous position.
15.Furthermore, the Prime Minister’s speech appears to suggest partial membership of the single market similar to the Swiss model, which involves a complex system of management through joint committees, and the EU unable to enforce its rules in Swiss courts. The EU has already stated that it may reject any more bilateral treaties with Switzerland unless they accept some ECJ rulings.
16.In addition, there would appear to be the potential for difficulty for the EU-27 in deciding which economic areas demanded which level of regulatory alignment and continuing UK-EU integration, which could require a long and complex negotiation.
17.We urge the EU to look closely at the proposals for a sectoral approach to regulatory alignment set out by the Prime Minister in March 2018. We also expect both sides to consider first and foremost the implications of ‘no deal’ for individuals, the life sciences and the wider health and social care sector across the whole EU as well as the UK. We note that Article 9 of the Treaty on the Functioning of the European Union obliges the EU, in defining and implementing its activities and policies, to take into account requirements linked to a high level of protection of human health.
18.In line with that view, this report makes two key conclusions that are reiterated throughout and apply to almost all aspects of the life science sector and processes within in it. They are:
i)The UK should look to secure, as a priority in the next round of negotiations, the closest possible regulatory alignment with the EU. Evidence submitted from pharmaceutical companies as well as those involved in the development and supply of medical devices, from academics, healthcare and workforce charities was almost unanimous in the view that regulatory alignment with the EU would be the best post-Brexit option. The continued supply of safe and effective medical devices, medicines and substances of human origin currently on the UK market will be more reliable if we continue alignment with EU regulation. We heard evidence that individuals, the NHS, and business could be adversely affected if this is not achieved. If full regulatory alignment with the EU is not secured, then a distant second-best option for the life science industry and patients in the UK would be alignment with another large market such as the Food and Drug Administration (FDA). While this form of alignment would raise significant complications, it remains preferable to the worst-case scenario for UK industry and patients, which is the UK endeavouring to create a standalone regulatory system after leaving the EU. There was a consensus that the UK was too small a market to do so and this would see later licensing and release of new medicines and devices than is currently the case.
This regulatory alignment should also include, but not be limited to, provisions for an agreement with the EU for Qualified Persons currently working in the UK to continue to have their work recognised in EEA countries, the transposition of Good Manufacturing Practice and Good Distribution Practice into UK law in the EU (Withdrawal) Bill, and the UK adopting the new Clinical Trails Regulations which were approved in the EU in 2014 but have yet to come into effect, along with the incoming Medical Devices Regulations.
ii)Industry, patients, and experts need to see evidence of the Government’s contingency planning for a situation in which the UK is unable to secure a deal with the European Commission for leaving the European Union. While the European Council has reiterated its wish to have the United Kingdom as a close partner in the future, they have clearly set out that the four freedoms of the Single Market are indivisible and that there can be no “cherry picking”. Any provisions which are put in place for continued co-operation between the EU and the UK in the life sciences are dependent on similar agreements being made across the whole of the negotiations, for every sector of the economy. As such, we believe it is not just prudent, but essential that scrutiny is undertaken of the Government, and the Department of Health and Social Care’s contingency planning for a ‘no deal’ situation. A disorderly UK exit could result in an immediate impact on the supply of essential medicines and medical products, both in the UK and the EU-27. The Secretary of State for Health and Social Care, the Rt Hon Jeremy Hunt MP, told us on 23rd January that details of the Government’s contingency planning would not be made public as to do so would undermine the negotiating position of the UK. However, we believe clarity about UK contingency planning to guarantee patient safety and continued health supplies will strengthen the UK’s negotiating position by demonstrating that we have a credible fall-back position. In these highly technical areas, with complex supply chains, extensive public scrutiny of any contingency planning will ensure that all relevant aspects are covered to guarantee the health of UK patients regardless of the Brexit outcome. The Health and Social Care Committee and other stakeholders must know the provisions that are being put in place by the UK Government for the possibility of a ‘no deal’ Brexit so that we can hold the Government to account in a meaningful way and ensure that patient safety is not compromised by the Brexit process.
19.Several members of this Committee are firmly of the view that the best outcome for the life sciences sector, the NHS, and for patients would be for Britain not to leave the EU, or at least to remain within both the single market and customs union. This report is written from the perspective of presuming that neither of those scenarios will be taken forward by the Government and therefore that a course of harm reduction should be pursued.
20.The concerns which we raise—and make recommendations to address—in this report are placed into sharper focus by the almost total lack of reference to Brexit in the Department of Health and Social Care’s Single Departmental Plan for 2018, published during the course of our inquiry. Single Departmental Plans outline the Government’s departmental objectives for the coming year. They were introduced in February 2016 and the second round of the plans was published in January 2018. As was reported by the Institute for Government in December of last year, each Single Departmental Plan outlines several key objectives, which are subsequently broken down into sub-objectives and then the actions which will enable the Government to achieve them.
21.“Get the best Brexit deal for Britain” is listed as the primary objective for the UK Government as whole, but only four departments explicitly refer to Brexit in their own objectives, and the Department of Health and Social Care is not one of them. Despite having the third highest number of Brexit work streams of any department, there are no key objectives, and no sub-objectives, in the Department of Health and Social Care’s Single Departmental Plan which explicitly refer to Brexit. In fact, only one action in the entire plan does mention Brexit, stating that to “Lead international engagement on health” the department will:
Assure and co-ordinate EU Exit readiness, working with the Department for Exiting the European Union and the devolved administrations.
22.Giving evidence on 23rd January, the Secretary of State told us that the Department of Health and Social Care is giving Brexit priority in industry discussions, and stated that “It is incredibly important.” We therefore find it surprising that Brexit references appear to make up such an insignificant part of the Department’s Single Departmental Plan for this year. This is particularly worrying when 2018 is a crucial year for achieving readiness throughout the NHS and social care services for Brexit, and for drawing up contingency planning for the possibility of the UK Government failing to secure a deal with the EU before March 2019.
23.When pressed on this issue in oral evidence, the Secretary of State replied that, “I would be surprised if it [Brexit] is not in there [the Department’s SDP] somewhere.”
24.We note the Secretary of State’s subsequent letter to us, which states:
As the Single Departmental Plan is a high-level summary of Departmental activity, we have included one reference to the central coordination activity for clarity and concision. The specific impacts as a result of EU Exit and the work streams being coordinated across the Department are embedded within existing departmental activity.
25.Single Departmental Plans are designed to reflect the priorities of each department for the coming year. Brexit must unquestionably be perceived as a priority for the health and social care sector in 2018, for all of the reasons listed in this report. That Brexit was not deemed as warranting either an ‘objective’ or a ‘sub-objective’ but merely an ‘action’ to facilitate these wider objectives in the SDP for the Department of Health and Social Care is deeply concerning.
26.We are concerned about the lack of reference to Brexit in the single Departmental Plan for the Department of Health and Social Care. Brexit poses huge challenges to the life science sector and carries a number of unintended consequences for patients and the NHS. We trust that the Government’s response to the recommendations of this report will reflect that and set out the department’s preparation in greater detail.
27.We received over 100 written submissions from a wide range of individuals and organisations with an interest in how Brexit will affect UK arrangements for medicines, medical devices and substances of human origin. We took evidence in December 2017 and January 2018 from witnesses representing patient and workforce groups, industry, experts and Ministers. We are grateful to all those who gave us evidence. We are also especially grateful to our specialist advisers, Prof Tamara Hervey, Jean Monnet Professor of EU Law at the University of Sheffield, and Nick Fahy, senior researcher at the Nuffield Department of Primary Care Health Sciences and independent health policy consultant, for their assistance throughout this inquiry.
1 Health Committee, Eighth Report of Session 2016–17, , HC640, December 2017, Cm9469
2 , Health and Social Care Committee - UK Parliament, accessed 8 March 2018
3 HC (2015–17) 640, Q 39
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16 Swiss want arbitration panels to settle disputes with EU, , accessed 3 March 2018
18 The UK makes up 3% of the global pharmaceutical market, whereas the EU current accounts for 27%. If the UK were to endeavour to create a stand-alone regulatory system, companies would need to obtain a separate market authorisation here from that for Europe, which takes money and time. As the UK market would be smaller than the EU market, companies may choose to launch in the EU first, or not in the UK at all, which would affect patient access to new treatments. For more information on the size of the UK market, see paragraph 31.
19 Qualified Persons (QPs) are individuals legally responsible for the safe batch release of medicines before they are placed on the market or used in clinical trials. Quality control testing by a QP is performed in one member state and then applies across the EU. For more information on QPs, see paragraph 82.
21 , [and others]
24 , accessed 8 March
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30 Follow up to Health Committee Oral evidence: Brexit – medicines, medical devices and substances of human origin, MHRA, 27 February 2018
31 Mr Nick Fahy declared the following interests: As part of my academic work, I undertake research and other work related to health policy and systems, which of course includes aspects related to health and Brexit; I am an independent health policy consultant with my own company, Nick Fahy Consulting Ltd (see http://www.nickfahyconsulting.eu). In that role, I provide advice on a wide range of health policy issues and how to constructively engage with health policy discussions for a mix of clients, both public (in particular international organizations such as the World Health Organizations) and private (in particular pharmaceuticals companies), including on the health dimension of Brexit; I used to be a member of staff of the European Commission, on long-term special leave(though still of course subject to the normal requirements of the Commission concerning obligations such as confidentiality and avoiding conflicts of interest, in accordance with the EU’s Staff Regulations), but resigned in 2017. My ongoing activities (academic and consultancy) require the Commission’s authorisation for two years after resignation –both have been approved; During the EU referendum campaign, I was an active campaigner to Remain; I helped to advise the Faculty of Public Health on a proposed amendment to the EU (Withdrawal) Bill which seeks to ‘do no harm’ to health in the UK post-Brexit; And finally, Iam a member of the Labour party, although I have never held any party office, and I have always taken care to avoid any impact on my ability to provide politically neutral and credible advice (as set out in the Civil Service Code, for example)
Professor Tamara Hervey declared the following interests: As part of the Jean Monnet programme, the European Commission paid a contribution of €42805 to The University of Sheffield towards to my salary and to support research activities (principally travel) during the period September 2009 – September 2012. See Ref: 2009–2835 Jean Monnet Ad Personam Chair: Enhancing Teaching, Learning & Research in EU Law. I am currently a co-investigator on two externally funded research projects: PI Fierlback, Dalhousie, Canada, Jean Monnet Network grant EU Health Law and Policy (2017–2020); and PI McHale, Birmingham) ESRC UK in a Changing Europe (Brexit) grant Health Law Outside the EU: Immediate, Intermediate and Long Term Impacts 2017–18. I am a member of the Advisory Board of Healthier In, a ‘grassroots campaign that continues to raise the voice of UK health professionals, carers, patients and researchers in the negotiations and policies following the EU referendum. We still believe that full membership of the EU is best for the UK’s health care and if ‘Brexit means Brexit’ then we must fight to work as closely as possible with the EU for effective health policy, data sharing and free movement of health workers and researchers’. See further http://healthierin.eu/. I worked pro bono with the Faculty of Public Health on a proposed amendment to the EU (Withdrawal) Bill which seeks to ‘do no harm’ to health in the UK post-Brexit.
Published: 21 March 2018