Originally Posted by
Solasch
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The pharmaceutical sector is one of the most productive in the UK, with a turnover
of £41.8 billion, providing 8.2 per cent of UK goods exports and employing more
than 113,000 people, directly or in service and supply roles. The sector is a mixture
of large UK-headquartered firms such as AstraZeneca and GSK, manufacturing and
research sites for other global companies, and a significant proportion of SMEs and
microbusinesses, researching and manufacturing branded, generic and over-the-
counter medicines for UK patients and consumers and for a global market. The sector
is part of heavily integrated EU supply chain that relies on the friction-free transfer of
ingredients and finished products to ensure access to medicines across the continent.
Leaving the EU without a deal for pharmaceuticals would risk a hugely damaging effect
on the sector in the UK, as access to markets diminish, including £11.9 billion of exports
and more than 446 million potential patients and consumers in the EU. It would also
risk a damaging effect on UK patients. With 73 per cent of pharmaceutical imports
coming from the EU, access to pharmaceutical products could be reduced, and as only
2.3 per cent of the global market compared to the EU27’s more than 22 per cent, the UK
may become a less attractive location to launch new medicines. Global efforts to remove
tariffs on pharmaceutical products mean that tariff costs for trading many established
products in the EU would be zero, but slow progress on World Trade Organisation
negotiations means many new medicines and ingredients will still be subject to tariffs.
These might be funded by the taxpayer having to underwrite extra costs to the National
Health Service as the main customer for pharmaceuticals.
Non-tariff barriers present a significant challenge to the industry, with any time- or
temperature-sensitive products delayed at the border at risk of not reaching their
destinations in a condition to be of benefit to patients. Additional costs and requirements
for the processing of customs procedures will, as with tariff costs, either burden
businesses or the NHS. We heard no evidence of a potential for the UK to replace the
EU supply chain for products with a domestic one.