October 10, 2018 / 4:50 PM / in 13 days

UPDATE 1-'Things will go wrong' if no Brexit deal, drug industry warns

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LONDON, Oct 10 (Reuters) - The head of Britain’s pharmaceuticals industry warned on Wednesday that problems were inevitable if there was no agreement on the United Kingdom’s departure from the European Union, putting drug stocks and approvals at risk.

The highly regulated drugs sector is one of the most vulnerable to a no-deal Brexit because of uncertainty as to how medicines oversight would function.

Companies are having to prepare for the worst, but the complexity of the industry’s supply chains and lack of clarity over transfer of files for medicines undergoing regulatory review makes planning challenging.

“The scale of what we are trying to do means that some things will go wrong because we are trying to replan a whole industry in a very short space of time,” said Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry.

“I’m not really convinced that everybody has fully understood what we are setting ourselves up for,” he told a committee of lawmakers.

Thompson pointed to the example of one company currently manufacturing medicines in Britain which was trying to revalidate more than 15,000 supply lines.

He said the industry as a whole had already spent heavily to prepare, but still had no idea what to expect.

“We’ve been planning for a worse case scenario in terms of the impact on us and therefore companies have already spent, probably collectively across the whole industry, hundreds of millions of pounds,” he said.

The British government told companies in August to build an additional six weeks of medicine stockpiles to cope with potential disruption - but Thompson warned there could be serious difficulties if supply chain delays were greater than six weeks.

Thompson was appearing alongside executives from other industry organisations representing small businesses, food and hauliers, who set out the problems they would face in the event of a no-deal Brexit, from delays at borders to rotting food.

Richard Burnett, CEO of the Road Haulage Association, said they had been limited in their ability to prepare because they had to sign a non-disclosure agreement with the government to discuss what a new customs system could look like.

“We’ve had to sign NDAs ... to know and understand what that looks like,” he said. “At this stage all I would say is that customs process from what we can see won’t work and industry is effectively telling (the government) that it won’t work and they’re not listening.”

Reporting by Ben Hirschler and Kate Holton; Editing by Janet Lawrence and Emelia Sithole-Matarise

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