What Does Brexit Mean For The Pharmaceutical Industry? | Valdamark Medical Packaging

Brexit fears are manifesting everywhere in business. Today we take a look at UK pharmaceutical industry and what they are doing to prepare.

Brexit

We ask what the Pharmaceutical Industry is doing to mitigate risks to manufacturing and investment post Brexit.

It is no secret that Brexit is a genuine threat to pharmaceutical research and manufacturing in the United Kingdom.

The fear is that Britain post brexit will not be an attractive market for direct investment. Manufacturing costs will also rise.

AstraZeneca and other large companies have placed a hold on all manufacturing investments. This goes back to 2017 when the drug maker decided not to go ahead with a planned refresh at its Macclesfield plant.

It is not just AstraZeneca other companies like Novartis and Pfizer the makers of Viagra have both introduced plans to shut UK production and pharmaceutical packaging sites before 2020.

These decisions have not been directly attributed to Brexit but the timing is very suspicious.

The main concern is that post Brexit Britain will have trouble attracting the highly skilled workers needed for this heavily regulated industry.

It is also likely that Britain’s role in EU funded research collaborations will be greatly reduced. Even excluded completely.

Take the EU’s Horizon Programme due in 2020 for example. In the event of a no deal Brexit Britain’s funding would effectively be halved from the £70 bn fund aimed at cutting edge science and research within the EU.

Brexit has already prompted the move of the European Medicines Agency (EMA) to Amsterdam from London. This move alone lost 900 jobs in the capital.

Britain has a thriving life sciences sector as a whole. This includes pharmaceuticals but also biotech, clinical research, medical equipment packaging and medical trials.

*This sector employs over 140,000 directly but indirectly supports over half a million jobs through intermediaries and the larger supply chain. Not to mention life sciences generates over £30 for the UK economy.

*Quoted from the Price Water House Coopers economic review,2017.

The UK pharmaceutical industry is vast, however we still rely on our European Neighbours for two thirds of the medicines consumed in the UK. Of which 90% come through Dover & Folkestone ports.

With this in mind the government has encouraged pharmaceutical manufactures & distributors to stock pile for six weeks. This is a big ask for perishable goods which have a short shelf life. Pharmaceuticals are often extremely moisture sensitive and will require additional packaging for preservation.

Despite this companies has taken the advice on board and have begun to stockpile medicines. There are also contingency plans in place to transport drugs to and from the European Union on ferries essentially rented by the government. They will be opening 6 new port routes to accommodate this.

Matt Hancock, the health secretary even has a plane on stand by to fly in medical isotopes, an essential component of many cancer treatments.

It is no surprise that the chair of the British Pharmaceutical Industry has labelled Brexit the largest logistical challenge to ever face the industry.

Effect of Brexit on the Packaging Industry

The implications of Brexit on the packaging and labelling industry affect various aspects. This includes legal changes, trade dynamics, and recycling practices. These changes are raising concerns, particularly for the UK's packaging sector.

Legal Changes
One of the most significant impacts lies in the realm of legal changes. Brexit is set to usher in a new era of regulations and trade arrangements. The intricacies of these changes could disrupt the established flow of goods. They can complicate customs processes and trade transactions.

The EU has long facilitated the ease of trade between the UK and its neighbouring nations. But, these simplifications may give way to a more intricate customs landscape.

The trade aspect is particularly problematic for the UK packaging industry. A significant part of its customer base is situated abroad. This makes foreign trade a critical component of its operations. Brexit can bring potential disruptions. It might result in negative repercussions for these businesses.

Recycling Policies
Moreover, Brexit may also affect the UK's recycling and environmental policies. The EU has set the bar for recycling standards, with many EU countries outpacing the UK in this regard. The UK has been strongly encouraged to adopt more progressive recycling practices. However, there are concerns that the UK may need to maintain a different level of commitment. This will impact its recycling initiatives and environmental advancements.

Conclusion

In summary, the potential downsides of Brexit significantly outweigh the positives. These downsides affect the packaging industry. In the past, the packaging industry played a crucial role in environmental sustainability. Prominent figures in said industry, such as Neil Farmer, have expressed their concerns.

Neil emphasised that a no-deal scenario could have a detrimental effect on the UK economy. This challenges the idea that leaving the EU might be a beneficial course of action. As of the moment, many uncertainties persist post-Brexit. This would mean the packaging and labelling industry faces a challenging future.

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