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UK pharma Brexit pessimism deepens, as govt admits sector could be among worst hit

Political gridlock fuels fears ahead of 11 Dec vote

A full 83% of UK pharma professionals say the UK will not be an attractive destination for healthcare research and manufacturing after Brexit, a new poll reveals.

The news coincides with new UK government economic analysis which admits that any form of Brexit will hit the economy, with pharma among the worst hit in the even of a no deal exit.

Industry analysts GlobalData have been conducting quarterly Brexit polls of pharma professionals in the UK, Europe and the US in 2018, and the latest Q3 survey shows a significant dip in sentiment.

Brexit poll

Confidence has dropped sharply from a high of 48% who said the UK would be an attractive destination in Q1 2018, hitting a low of just 17% who said it would be in the latest survey.

The survey comes just days ahead of a crucial vote in the House of Commons on 11 December, when Prime Minister Theresa May will seek to gain MPs backing for her now-agreed deal with the EU.

However it looks almost certain to be rejected by the Commons, leaving all sides having to prepare for several scenarios – from a tweaking of the deal, to a second referendum or even a no deal Brexit. This is something which businesses and economists have warned against, and the Conservatives and Labour have both said they will try to avert, but the political gridlock means this remains a real possibility.

Commenting on the survey results, Alexandra Annis, MS, Managing Healthcare Analyst at GlobalData, said:

“Sentiment on this question has potentially been affected by the considerable amount of negative press associated with Brexit’s likely impact on the healthcare sector over the past three months. Stories such as the NHS requiring drug makers to stockpile drugs in preparation for a 'no-deal' Brexit and pharma companies like Sanofi and Novartis increasing medicine stockpiles, and AstraZeneca halting UK investments over Brexit uncertainties likely played a part in negatively affecting industry professionals confidence in the UK.”

GlobalData says the largest difference in attitudes to Brexit is seen in the US, where respondents seemed less concerned about potential negative impacts. Less than 20% of respondents in the UK and EU viewed the UK as an attractive destination for healthcare research and manufacturing post Brexit, whereas pharma professionals in the US were more optimistic with 38% believing that this will be the case.

This will be good news for the UK government, which is trying to maintain inward investment into the country from the sector, despite the huge uncertainty caused by Brexit.

The government is understood to have an updated Life Sciences Sector Deal ready to announce – however the benefits of this could be dwarfed by Brexit and its potential outcomes. This could include the UK leaving the EU regulatory structure completely, including EMA alignment in the event of a no deal Brexit.

Government candid on economic impact

After a long period of evading questions about the economic impact of Brexit, the government this week produced a candid assessment of the effects of different Brexit outcomes.

Chancellor Philip Hammond stated that compared with remaining in the EU, any form of Brexit will leave the UK financially worse off, but said May’s negotiated deal “minimises the economic impact while providing political benefits”.

The accompanying Long-term economic analysis of EU Exit also suggested that pharmaceuticals (as part of a Chemicals, pharmaceuticals, rubber and plastic grouping) particularly affected by a no deal Brexit.

Article by
Andrew McConaghie

30th November 2018

From: Healthcare

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