Pharma companies warn new stockpiles of medicines needed for 'no deal Brexit' after reserves dry up

Tue 9 Jun 2020
Posted by: William Barns-Graham
Trade News

pharma

Stockpiles of key pharmaceuticals have been used up in the government’s response to the coronavirus pandemic leaving the UK short for the next potential crisis – a possible ‘no deal Brexit’.

This is the warning made in a memo written to government by a cross section of pharmaceutical industry groups, reported in the BBC.

Different market

The industry last year paid for six weeks’ worth of stockpiles in case of a ‘no deal’ exit from the EU, while negotiations were ongoing for the withdrawal agreement.

However, because of the COVID-19 pandemic in 2020, the industry has warned that there is “less or zero product available in the market to allow for stockpiling” this year.

Logjams

Should the UK leave without a deal, the move to trading on WTO terms could create logjams at key trade gateways into the UK including the post of Dover which handles 90% of the UK’s drug imports.

It is estimated that the number of customs declarations being handled by border officials will increase by 200 million, with an additional 50,000 customs staff estimated to be needed to handle this surge.

A parliamentary report from 2018, considering the impact of Brexit on the industry, said tariffs and the costs and resources used processing customs procedures would “either burden businesses or the NHS.”

The paper also said non-tariff barriers present a “significant challenge” as the industry is reliant on fast transportation of time- or temperature-sensitive products which are of no-use to patients if not delivered on time.

Warning

The memo warned government against “drastic policies mandating wholescale changes to global supply chains” saying “this could fundamentally disrupt the supply of medicines for the NHS and patients in other countries.”

The industry has also warned that to build up reserves in time for a potential no deal, stockpiling would have to begin in the next few weeks.

Dr Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry has called on government to put plans in detailed plans in place, including stockpiling.

“Our members will continue to work closely with Government to put detailed plans in place, but not everything is in the gift of industry,” he said. “Stockpiling is one element; having alternative supply routes and making sure that goods can continue to flow uninterrupted across borders is also critical.”

He also called for clarity on the Northern Ireland Protocol, saying practical information was “essential in supporting companies to get medicines to patients in Northern Ireland from January 2021.”

Key stats

  • The pharmaceutical industry in 2017 turned over £41.8 billion, provides 8.2% of the UK’s exports and employs more than 113,000 people
  • In the same year, the UK exported £11.9 billion of pharmaceuticals to the EU where there are 446 million potential patients
  • 73% of pharmaceutical imports into the EU come from the EU
  • The UK represents 2.3% of the global market for the industry compared to 22% for the EU27

(Source: House of Commons)