UK Government did not need to lose European Medicines Agency

The UK Government’s inability to comprehend the task of Brexit has now had a direct consequence – the completely unnecessary loss in the short term of the European Medicines Agency (EMA) and, in the long term, of thousands of jobs in the pharmaceutical and healthcare jobs from the UK.

Even with the referendum vote, it did not need to happen. But here is the thing: the loss also demonstrates the scale of the farce.

Fundamentally, the EMA evaluates drugs, notably thus approving them for use in the European Union. This is a huge task, as it affects the safe medical provision for over half a billion people and, of course, is of huge interest to the mammoth pharmaceutical industry in its biggest collective economic market.

Let us just consider a straightforward issue: the EMA does something which is necessary for all 28 EU member states, but does it for all of them at once. The UK, for example, pays nearly a fifth of the EMA’s budget but gets all its services.

Because fundamentally an EMA is an EMA (administratively it does not really matter how many territories it covers because it has to do the same thing regardless), the post-Brexit EMA will be almost the same size as the old one. Yet a fifth of its budget will be gone – thus the remaining member states will in effect have to pay 25% extra for the same service. This is the crux of the Leave argument – “They can’t do without our money!”

Yet there is an obvious problem with this. The UK itself will, of course, also have to replace the EMA with its own Medicines Evaluation Regulator, and because that will be doing almost the exact same thing as the EMA at the same level of service (and complexity), it will cost the same as the outgoing agency. Except instead of being responsible for 20% of the budget, the UK taxpayer will be responsible for 100%.

Therefore, where the average EU State will face the headache of finding 25% extra for the same thing, the UK will face the full blown migraine of having to find 400% extra.

This is to leave aside the fact, with just 18 months to go to Brexit Day, that there is no sign that the legislation required for the new UK authority has even been drafted. Putting through such legislation, with all the competing lobbying interests, will take, well, rather longer than 18 months…

None of this needed to happen. On 24 June 2016 the UK Government could immediately have said that it intended to retain the same medicines evaluation, authorisation and approval mechanism as the rest of the EU and that, in its opinion, there was therefore no need for any move or change to the EMA (including its contribution to its operation). After all, had people really voted with such matters in mind?

Instead, it will now lose the EMA, with pharmaceutical companies which had deliberately set themselves up to be near it gradually shifting their operations (and jobs and tax revenue) out of the UK in due course. This is all due to the UK Government’s carelessness – or, more bluntly, inability to grasp what the EU actually is.

In conclusion, let us then return to the scales noted above – the new arrangement costs the remaining EU 25% more and the UK 400%. That is exactly what is meant when people say Brexit is bad for everyone – but it is many multiples of times worse for the UK than it is for anyone else. We need to end the delusions to the contrary.

An interesting addendum is that the rent on the London office was signed to 2039, leaving the EU with a €400m bill (albeit over more than 20 years). 

But this again reflects the UK’s problem – the UK is bound to pay its share of such bills even once it has left, as it signed up to them (with the exception of two European agencies at their new locations). That is fundamentally what the “£40b” is about.



4 thoughts on “UK Government did not need to lose European Medicines Agency

  1. korhomme says:

    David Davis said in April 2017 that Brexit would not mean that the medicines agency or the banking agency would have to leave London. Both are going.

    The EU has about 40 agencies; not all will need to be replicated.

    The UK is also leaving Euratom, the nuclear agency. This is important for the supply of isotopes used in medical diagnosis and treatment. Euratom is a legally separate entity from the EU, but comes under the jurisdiction of the European Court of Justice.

  2. Gary Phillips says:

    Excellent summary highlighting the financial dilemma that the UK now finds itself in

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