The ink was still drying on new EU medical devices regulations when the UK decided by referendum to leave the 28-member bloc.
Drafting the new rules, which proponents promise will make devices safer while preserving patient access to innovative products, had been a long, hard slog. While UK authorities and politicians have played a prominent role in the process, they must now grapple with deep uncertainty over how the Brexit negotiations will play out.
Stunned industry leaders still grappling with the news are wondering aloud whether the UK will retain access to the single market and the right to issue the CE-marks required to market medtech products in Europe.
The answer will dictate the future of clinical research, inward investment, the ability to attract talented scientists and doctors, and the approval of new medical technologies in Europe.
“From a business perspective it is hard to see an upside to the UK’s decision to leave the EU,” says Bill Doherty, executive vice president EMEA, Cook Medical. “Britain’s influence in the development of the European MedTech regulatory environment has been extremely positive and we now face an uncertain situation with possible regulatory divergence over time.”
This divergence is the big fear. Ironically, for all the debate about ‘red tape’ from Brussels, the possibility that the UK might have to develop a parallel regulatory system, requiring companies to file separate applications to access the UK and EU markets, would add a new layer of bureaucracy.
At present, medical devices can be marketed throughout the European Economic Area once they have a CE mark issued by any Notified Body, of which there are around 70, overseen by national regulators.
The approach is less bureaucratic than the centralised medicines regulatory system, where pre-market approval demands an investment of time and money which only the biggest players can handle. MedTech insiders argue that CE-marking suits the SME-dominated industry, helping to get innovative products to patients in Europe more quickly than in the US.
Brexit is a major spanner in the works of the revamped regulatory system, which has yet to come into force. Myra Daridan, Chief Executive of Clinical Research Consultants based in Paris, said the future of Notified Bodies is crucial. “It is unclear whether Notified Bodies throughout the EU would still be considered competent in the UK after Brexit,” she says. “It would depend on whether the UK can negotiate European Economic Area status, as is the case in Norway, Iceland and Lichtenstein where Notified Bodies are recognised.”
Hugh Davies, a paediatrician and Research Ethics Advisor at the UK’s Health Research Authority, says everyone loses if the UK “goes it alone” so he expects all parties to find a way to keep the UK in the EU’s medtech regulatory system.
“It’s a question of what they will be able to rescue from the wreckage,” he says. “If a deal cannot be done, device manufacturers would need to go through approval twice, once for the UK market and once for the EU market, and I don’t see any value in that for anyone.”
Instead, he expects a “desperate attempt to keep things as harmonised as possible”. In practical terms, this would mean mutual recognition of UK and EU Notified Bodies, with the UK essentially following the rules it helped to shape but unable to influence how they evolve in future.
“The UK MHRA has been incredibly influential in leading on so many aspects of how healthcare products are regulated,” says Davies. “Now we are marginalised. We may be invited to the table but won’t have a voice.”
For its part, the UK’s national standards body, the British Standards Institution, says its role as a Notified Body will not change in the near term. “BSI fully anticipates we will remain a long-term major EU Medical Device Notified Body as there are established well recognised existing mechanisms in place for non-EU countries to participate as EU Notified Bodies,” it said.
Citing Norway’s role in the EEA and the Mutual Recognition Agreements between the EU and Switzerland and Australia, BSI argues that a formula will be found to minimise disruption. “For now, it’s business as usual and most importantly, we would like to assure you that BSI will continue to provide EU market access as we have done since the inception of the three EU Medical Device Directives.”
Specialist medtech lawyer Erik Vollebregt says that while the situation is unprecedented, his best guess is that the final settlement will resemble the Swiss model. “That agreement allows Switzerland to have notified bodies and provides for mutual recognition of the CE mark in Switzerland,” he says.
The role of Notified Bodies is not the only talking point among medtech leaders. Sinead Keogh, Director of the Irish Medical Devices Association (IMDA) says Brexit also has implications for ‘Authorised Representatives’ – the person legally designated by manufacturers to liaise with competent authorities and Notified Bodes in the EU. They play a major role in ensuring product safety and where product recalls are triggered.
“At present, medtech companies may have their Authorised Representative based in the UK who can represent the manufacture at EU level for issues related to post-market surveillance of devices,” she says. “One can potentially see implications for UK-based authorised representatives who, upon an exit, may not be eligible to represent manufactures within the EU. This could mean companies would have to establish authorised representatives within another EU state.”
Keogh said a “pragmatic” arrangement must be found to the current crisis, noting the broadly negative impact Brexit could have for the Irish economy. Indeed, the Irish government is among the more sympathetic EU members, fearing contagion if the EU-UK deal locks the UK out of the single market.
Clinical research under threat
With regulators seeking increasing volumes of data on new and existing devices, this should be a boom time for clinical research. The UK’s high-quality health service and top-notch talent pool makes it an attractive destination but that reputation may now be in jeopardy. Will medtech companies prefer EU locations when conducting clinical investigations?
“In my view there may be a reluctance by EU firms to get UK sites involved in clinical trials, simply because of the psychological effect of Brexit,” says Daridan. “For the time being, I expect firms to defer any involvement in clinical research in the UK until the situation is clearer, just as we are seeing with banks and other investments. As a result, one would imagine a decrease in innovation originating in the UK in the immediate future at least.”
Others say they will continue to include the UK in multi-centre trials as the data generated there can be used when filing with regulators in the EU. “I don’t foresee any significant change regarding clinical studies in the UK, certainly in the short to medium term, unless there was a seismic change in the regulatory environment,” says Doherty. “The UK patient population is reflective of the European patient population so the data would continue to be valid and acceptable to EU regulators.”
Keeping jobs, attracting talent
The medtech industry provides 71,000 jobs in the UK, making it second only to Germany. The UK is also the third largest market in Europe for medical technologies. The UK government warned of job losses in science-based industries in the event of Brexit with commentators fearing that foreign direct investment and clinical research could be hit, along with a fall in prestige for top-ranked UK universities.
The threat to UK involvement in pan-European research projects, whether funded by industry or through EU funds, could lead to a brain drain. “We’ll still train doctors and healthcare professionals to a high standard,” says Davies. “But we cannot be sure they will not seek opportunities elsewhere that offer access to [European] funding and research networks.”
Daridan says the impact on employment could be strong. “Complicating national recruitment processes and work permits may lead to fewer pharma and medtech companies recruiting their middle management in the UK, and Contract Research Organisations (CROs) will be cautious about being based in the UK,” she says. “Indeed, if access to talent is impacted, it could lead companies to move outside the UK where it would be easier to recruit the qualified international talent they need.”
The UK-based industry is calling for calm as the dust settles on the momentous vote but accepts there are unchartered waters ahead. “Over the coming months the UK will begin the process of agreeing the basis of a new relationship with EU partners,” said Peter Ellingworth, Chief Executive at the Association of British Healthcare Industries. “Complex negotiations and decisions lie ahead.”
This was echoed by MedTech Europe, an alliance of European trade associations: “We will work with the UK, all other European governments and the EU institutions to encourage policies that ensure timely access to safe and innovative medical technologies for the benefit of patients, while helping healthcare systems move towards a sustainable path.”
When EU leaders gathered in Brussels earlier this week to discuss the implications of the UK referendum, the nuances of medtech regulation were unlikely to top the agenda. Yet the big conundrum of how the UK can access the single market without permitting the free movement of labour is central to the future of the medical devices sector.There are few certainties as the EU waits for the UK to trigger exit talks, but there is a strong demand from the medtech sector for clarity on how the regulatory system will look post-Brexit.