Impact of Brexit on Raw Materials Testing for the Pharmaceutical Industry

Butterworth Laboratories Ltd (BLL) was established in 1974 and hence has always operated in a UK that has been a member of the EEA/EU, and since its foundation BLL has evolved from its beginnings as an elemental microanalysis laboratory to QC testing in support of the pharmaceutical industry. Although finished product testing accounts for around 10% of its business, and BLL also performs GLP studies and testing in support of clinical trials, by far the majority of its business is the GMP testing of raw materials and APIs for clients based in the UK, EU and the rest of the world. 

As the testing of raw materials often involves tests that may be difficult to perform and/or require expensive equipment which may not be fully utilised, this testing may not be cost effective for clients to perform in-house; this is especially true for those who may only have to test three or four batches a year. This type of testing relies on the expert knowledge of chemistry and the various pharmacopeia gained from the experience of performing a variety of tests over many years that often only a contract laboratory can offer.

The recent developments over the Brexit situation, and the uncertainty and lack of clarity resulting from this, has caused an unsettlement amongst many business sectors throughout the UK and EU alike.  Many organisations now have serious concerns over what the regulatory impact of a no-deal Brexit will have on their businesses

However, one certainty is that the QC testing of raw material will not be impacted by the same regulatory restrictions that may be placed on final drug products, post Brexit; even in the event of a no-deal.

To quote the MHRA:

‘You only need to name contract laboratories on a manufacturing authorisation if they are performing an inspectable activity…

Contract laboratories only need to be named if they are undertaking the following testing of medicinal products or an investigational medicinal product for human use:

• Microbiological, biological and chemical/physical testing of finished medicinal products
• Stability testing of finished marketed medicinal products
• Environmental monitoring and or process simulation work for sterile product manufacture; or
• Biological testing if it is required to be conducted in accordance with the GMP Guide as described in Annex 2 of EU GMP

Contract laboratories that conduct all other testing (e.g. raw material and API testing) or produce data for research where the products are not intended to be released onto the market or used in clinical trial do not need to be named on a manufacturing authorisation.’

This means that even in the event of a no-deal Brexit, the world of raw material testing will continue as it does today. Clients who currently send raw materials manufactured in the UK, EU or the rest of the world for testing may continue to do so without the need to change anything. This provides obvious comfort for contract laboratories such as BLL, but should also provide equal levels of security for clients that have established long term partnerships based on honesty, trust and reliability in the services provided by Butterworth Laboratories and its competitors in the analytical chemistry industry.

This does not mean to say that BLL has not been carrying out extensive Brexit planning.  Like many businesses, Butterworths has been planning for the worst case, no-deal scenario as this may have an effect on other areas of its business, such as finished product testing.

The recent technical notices and updates from the UK and the EU on what will happen to medicines regulation post-Brexit should a ‘no deal’ be reached, have revealed that the MHRA will continue to accept batches of medicines tested and released in the EEA/EU countries for distribution into the UK market. This stance will allow the MHRA to ensure continuity of supply of vital medicines to the UK. The EU, on the other hand, have stated that they will not continue to accept batches of medicines manufactured, tested and released in the UK into the EU single market. Clearly this presents a number of issues for final drug product manufacturers based in the UK who release their products into the EU. Do they simply get their products tested in both the UK and the EU?  Or does it make more sense to their business model to relocate their site of manufacture to the EU?

The situation regarding the GLP and GCP regulations is a little clearer.  BLL has carried out an assessment on the potential effects of Brexit and is confident that as GLP/GCP are regulated at the national level, nothing of significance should change.

In conclusion, the majority of Butterworth Laboratories’ work should continue as normal, irrespective of whether a no-deal Brexit occurs or not. 

There is one great positive to be taken from the current situation, regardless of the outcome of the final deal; the uncertainty created by the referendum result has driven the BLL senior management team to develop some very alternative, disruptive and quite aggressive plans to mitigate any adverse impact.  Although it now seems that these may not be required in mitigation of Brexit impact, they are not being cast aside, but rather they are being reassessed for incorporation into an existing 5 year vision.  As a result this has had a very positive impact on the creative thinking of the leadership team and allowed them to develop some exciting and innovative new projects that otherwise may have been deemed too high risk.

Ultimately, whatever the future holds, BLL feels confidently prepared to meet the challenges presented by the UK’s departure from the EU with the same high levels of service and expertise as it has done over the last 45 years within the EU. 

Butterworth’s pride themselves on forging strong working relationships with their clients.  Fundamental to this is an open dialogue and discussion of any issues of concerns our clients might have.  If you have any questions about how Brexit might affect your relationship with Butterworth’s, please contact our Business Development team.  As always, we are happy to help.