(First published 28 December 2020, updated 31 December 2020).
The Trade and Cooperation agreement between the European Union and the United Kingdom published on 24 December 2020 identifies particular areas of interest to pharmaceutical and healthcare sectors. The following brief guide describes the overall structure of the agreement and identifies/directs to specific topics, but it should not be considered a full precis, analysis or advice of the 1246-page document. There is also discussion of some scientific elements which are excluded from the agreement.
Overall Agreement Structure
The Agreement comprises 7 Parts covering:
- The Agreement comprises 7 Parts covering:
- Common and Institutional Provisions
- Trade, Transport, Fisheries and Other Arrangements (including intellectual property, transport of goods)
- Law Enforcement and Cooperation on Crime
- Thematic Cooperation (including health security)
- Programme Participation and Finance
- Dispute Settlement and Horizontal Provisions
- Final Provisions
Each Part is divided into topics called Titles, designated by roman numerals.
The seven Parts are supported by 49 Annexes, of which the following are particularly relevant to the pharmaceutical and healthcare sectors:
- Annex ORIG-1 to -5: product origin (page 415)
- Annex TBT-2: medicinal products (page 492)
- Annex TBT-3: chemicals (page 504)
- Annex TBT-4: organic products (page 507)
- Annex SERVIN-1 to -6: services and professional recognition (page 530)
- Annex ROAD -1 to -3: Transport of goods by road (page 800)
There are also a series of Protocols (each subdivided into Titles, designated with roman numerals, and Annexes) relating to tax, administration and social security.
Science
At the outset, there is acknowledgement that agreement about the UK access to European programmes could not be finalised within the negotiating timetable. The intent of both parties to progress these is documented, including one of which seeks to encourage future cooperation in science programmes. There appears to be sufficient confidence in this aspiration that a draft has been included in the appended joint declarations allowing UK to participate in (among others) the Horizon Europe Framework Programme for Research and Innovation (Draft Joint Declaration Article 1.b & 1.c, page 16; Article 4, page 18; Article 5, page 19). It is expected that this will form the basis for subsequent agreement. Details of Horizon funding and finance arrangements up to 2027 are set out in this 26-page document. The first healthcare mission priority within the Horizon programme is cancer. Although the UK will participate on an equal footing, it will only have observer status on the Joint Research Centre Board of Governors and will not participate in the European Innovation Fund (Draft Joint Declaration Article 6, page 21).
[At present, the UK will no longer participate in the Erasmus programme for academic exchange, which starts a new 7-year cycle in 2021. Existing UK participants may complete their current assignment. Non-EU countries can participate in the scheme (subject to financial contribution) but this is not currently envisaged by the UK government, which has independently flagged its intention to establish a system for global academic exchange (the Turing Programme)].
Pharmaceuticals & Healthcare
From the outset, there is agreement to cooperate on measures which address antimicrobial resistance (Article SPS.17, page 51) by control of antibiotic use.
Considering cross-border health security, the UK may ask for access to the EU Early Warning and Response System (EWRS) and the UK may be invited to participate in committee(s) which address such hazards, but these would be limited to the specific need and would not continue in perpetuity (Article HS.1, pages 362-363).
Annex ORIG (pages 415-486) covers the requirements for rules of origin. This may be relevant to pharmaceutical and healthcare product packaging materials and also to the materials used in the manufacture of the products themselves. Of particular relevance in this section is Note 5 (pages 417-419) which provide definitions for manufacturing processes which are used in the pharmaceutical and healthcare sectors. Similarly, Notes 6 and 7 (pages 419-422) cover definitions of woven materials which may be relevant to medical dressings. Based on the established 2017 Harmonised System on rules of origin, medicines and pharmaceuticals are specifically listed on page 419 (considering definitions of purity), with a Change of Tariff Sub-Heading for pharmaceutical products on page 430 and a Change of Tariff Heading for medical or surgical instruments on page 468. In general, there is a maximum limit of 50% on the ex-works product value attributable to all costs of components obtained outside the stated country of origin.
Annex TBT-2 covers Medicinal Products (pages 492-503): including GMP, quality, inspections and national statutory authorities.
Shipping and Transport of Goods
Goods for humanitarian purposes, which include medical, surgical and laboratory equipment, are allowed to pass through a country’s customs without import duties, taxes or other restrictions, if they are to be re-exported without material change (Article CUSTMS.16, page 71/72). Such goods may also be carried by transport without normal licence (Article ROAD.6, page 248-249).
Distribution of pharmaceuticals is covered in Reservation No. 13 (pages 675-676).
Intellectual Property
Protection of intellectual property, including medicinal products, is covered in TITLE V: Intellectual Property pages 125-147. In particular, patents are covered in Section 4: Patents, pages 136-147.
Future arrangements will be channelled through the Working Group on Medicinal Products which will operated under the supervision of the Trade Specialised Committee on Technical Barriers to Trade (article INST.3: Working Groups, page 15).
Health and Pharmaceutical Professional Services
Although service industries are not the focus of this Agreement, the provision of healthcare and pharmaceutical professional services is covered in a series of Reservations. These appear to cover service areas which do not conform with the Agreement terms for:
- investment liberalisation (Articles SERVIN.2.2 & SERVIN.2.3, page 79),
- cross-border trade (Articles SERVIN.3.3 & SERVIN.3.4, page 84),
- most favoured nation treatment (Article SERVIN.2.4, page 80),
- senior management and boards of directors (Article SERVIN 2.5, page 80), performance management (Article 2.6, page 80) or
- legal services (Article SERVIN.5.49, page 115)
but which may be subject for improvement in subsequent negotiations.
Of particular relevance are:
- Reservation No. 3 – health and pharmaceutical professional services (pages 563-574; pages 658-661; pages 721-722)
- Reservation No. 10 – health and social services (pages 731-732),
- Reservation No. 13 –health and social services (pages 604-608; page 675)
- Reservation No. 17 – energy related activities (pages 691-693).
Queen’s House Consulting will continue to offer services to the pharmaceutical and healthcare industries in the areas of pre-clinical pharmaceutical development, technical assessment for pharma start-up and follow-on investment/due diligence, regulatory authoring, pharmaceutical and healthcare strategy and systems analysis. Please contact Queen’s House Consulting to discuss your particular needs.
Google+