UK: Brexit - What Vote Leave Means For UK Life Sciences

Last Updated: 8 July 2016
Article by John P. Cooper and Patrick Duxbury

In this article we consider what we know regarding the consequences of the UK's Leave vote for funding, the regulatory regime for medicines and intellectual property, particularly the patents ecosystem.


There is considerable uncertainty as to when (and, even, whether) the UK will exit the EU (a so-called "Brexit"). Nor do we know the nature of the UK's ongoing relationship with the EU after any Brexit occurs, the specifics of which will impact the landscape for the life sciences sector.

If the UK emerges from Brexit as a member of the European Economic Area (EEA), there will be greater scope for a negotiated continued UK involvement in EU regimes and mechanisms.

Funding for research through European schemes

UK life sciences companies and scientific researchers benefit from various funding schemes. Arguably most relevant for the life sciences sector is Horizon 2020. Described as the biggest ever EU research and innovation programme, Horizon 2020 is making available €80 billion between 2014 and 2020 with the aim of supporting breakthroughs, discoveries and world firsts.

The Innovative Medicines Initiative (IMI) is another funding mechanism for the life sciences sector. Bringing together government (through the EU) and industry (as represented by the European Federation of Pharmaceutical Industries and associations (EFPIA)), its second phase budget for 2014-2024 is €3.3 billion (half coming from Horizon 2020).

Funding for research is also available in the life sciences sector through the European Investment Fund (EIF). Held by the European Investment Bank, other banks and financial institutions and the European Commission, the EIF invests money in venture capital funds that then invest directly in businesses, to promote the creation and development of SMEs.

The European Research Council (ERC) also provides access to funding which supports the underlying science base in the UK.

According to the UK BioIndustry Association, a trade association for UK bioscience, the UK is a net recipient of EU funding for its health research, accessing more funding per capita than any other country.

Outside the EU, the UK is likely to find access to such funding mechanisms significantly reduced. The UK Government's Department for Business, Innovation and Skills has issued a statement on higher education and research following the EU referendum, which includes the following:

"The referendum result has no immediate effect on those applying to or participating in Horizon 2020. UK researchers and businesses can continue to apply to the programme in the usual way. The future of UK access to European research and innovation funding will be a matter for future discussions. Government is determined to ensure that the UK continues to play a leading role in European and international research and innovation."

It is therefore imperative for the UK Government to make clear that, in the event of any Brexit, UK Government funds will be made available to UK-based life sciences research institutions (and across all innovative sectors), in both the private and public sectors, on terms which are equivalent to those available through the European schemes. This is necessary to support and secure the UK's position as a leading research base into the medium and long term, and with it the wider benefits to the UK economy.

Similarly, in the course of the UK's transition through Brexit, funds must be made urgently available in order to ensure that ongoing research programs, which may be dependent upon approval of application(s) for funding from such EU sources, continue to remain viably located in the UK.

Whether venture capital funding for early stage companies might be affected by a Brexit remains to be seen. At the very least, investors might think twice about establishing a new spin-out in the UK. The UK has, in recent times, established itself as a jurisdiction of choice for setting up new life science companies in Europe and it would be a shame, to say the least, to see that change. In the short term we are already aware of transactions being put on hold while parties assess the wider implications of a Brexit.

The regulatory regime for medicines and medical devices

The life sciences sector is one of the most highly regulated industry sectors in the world. The majority of the UK legal frameworks governing medicines (including clinical trials, marketing authorisations, licences to manufacture and pharmacovigilance) and medical devices are based on, or directly apply, EU legislation.

The European Medicines Agency (EMA) is the European regulatory agency in charge of providing EU institutions with scientific advice on medicinal products. It is responsible for the centralised authorisation procedure for human and veterinary products, which results in a single marketing authorisation that is valid in all EU countries, as well as the EEA countries (Iceland, Liechtenstein and Norway). The centralised procedure is compulsory for certain categories of drugs and diseases, optional for others.

Where the centralised authorisation procedure is not compulsory, approval can be obtained from a national regulatory agency, with EU-wide approval still available under a mutual recognition mechanism or decentralised procedure. The UK's Medicines and Healthcare Products Regulatory Agency (MHRA) is the national agency in the UK.

Prior to a Brexit, decisions will need to be taken on what procedures will be available to obtain authorisations and what mutual recognition will be available following Brexit. Whether the UK becomes an EEA country will be highly relevant here.

In the short term, the legal frameworks are unaffected by the outcome of the referendum, and EU law will continue to govern the regulatory regimes, as well as the regulatory categorisation of different products and devices. EU law will continue to shape the outcome of UK cases, such as in the recent Court of Appeal decision in R (Blue Bio) v Secretary of State for Health on the boundary between medicines and food supplements.

It seems unlikely that, if the UK were to leave the EU, the government would be in a rush to change much of the law which currently regulates medicines and medical devices. However, EU life sciences law is not standing still. There are significant EU legal reforms due to come into force on a timetable which overlaps the period in which a Brexit might occur. These include important new EU Regulations on medical devices and clinical trials. Given the uncertainty over the timing of a Brexit, there are significant challenges for business in knowing how to prepare for legal changes. There is a risk for the UK that investment and activity in these areas will be diverted to countries where the future regulatory regime is more certain.

The UK has been effective in influencing the shape of EU regulation that impacts the life sciences sector. In this, the UK has been greatly assisted by the reputation and efforts of the MHRA, which is considered to be a world-leading regulator. Outside the EU, the UK will not be able to influence the European framework legislation. However, multinational businesses will need to continue to comply with the European regulatory framework. Moreover, the UK regulatory framework is, in practice, unlikely to diverge materially from the European framework.

Brexit will also most likely increase the volume of regulatory scrutiny to be conducted at the UK level, increasing costs for business and the country.

In addition, the EMA is based in London. It seems inevitable that a Brexit would lead to the EMA moving to a country which is a member of the EU. This would be a significant loss for the UK. Having the EMA located in London puts the UK firmly in the centre of drug regulation in Europe. In short, biopharmaceutical sector regulation is an area in which the UK Government must prioritise the development of strategy to manage a smooth and constructive transition in any Brexit.

Intellectual property and the patents ecosystem


Brexit will not impact the existing system for the grant and enforcement of European patents covering the UK, which will continue. This is because the current system is established by agreements made outside the remit of the EU and EEA. The UK's reputation as a jurisdiction in which patent disputes are heard and resolved in a proportionate manner by experienced and specialist judges, who deliver high quality judgments, will continue.

However, the UK's Leave vote is likely now to delay implementation of the new Unified Patent Court (UPC) and Unitary Patent (UP) system.

In recent years, most member states of the European Union, including the UK, have been working together to introduce the new UPC system to establish, for the first time, a court with jurisdiction to resolve patent disputes spanning much of the EU. The UPC, along with the UP (a new, single patent right of equivalent scope), represents a fundamental change to the patents landscape in Europe. In various ways it supplements, complements and replaces aspects of the existing system.

However, the treaty that establishes the new system (the 'UPC Agreement') mandates (among other things) that participating countries must be members of the EU, that it will enter into force only following ratification by the UK, and that the location of a part of the Court of First Instance (being the part of the court that will deal with life sciences cases) will be in London.

It is theoretically possible that the UK could ratify the UPC Agreement before any Brexit takes effect, in order to get the new system operational. However, we consider this to be unlikely. In any event, the location of part of the Central Division (a part of the Court of First Instance) in London is likely to be considered by the other participating states to be an unsustainable oddity needing correction, by amendment to the UPC Agreement. Some countries could treat this as an opportunity to re-visit the wider negotiations. If the history in this area is anything to go by, agreement could take some time.

Consequently, the UK's Leave vote is, in practice, likely to postpone any change to the current system for grant and enforcement of patents, not just for the UK, but for the whole of Europe. Whether the UK will make the new system operational in the short term, and whether it will be able to negotiate a way of remaining involved in the UPC and UP system in the circumstances of Brexit, remains to be seen.

For more on the consequences of the UK's vote Leave for patents, please see our article " Brexit: what the UK's vote Leave means for the patents ecosystem and UPC".

Supplementary protection certificates

Supplementary Protection Certificates (SPCs) provide for extended patent protection for the active ingredient(s) in medicinal products and plant protection products. SPCs are granted at the national level by the relevant patent office (for the UK, the UKIPO), pursuant to European legislation which has effect across the EU and the EEA.

A Brexit from which the UK does not emerge as a member of the EEA will mean that the UK needs new national legislation to implement its own patent term extension scheme (probably by amending the UK Patents Act 1977) in order for SPC-type protection to continue to be available following Brexit.

Wider intellectual property (IP) rights

A Brexit that sets the UK adrift from the EEA will mean that the UK needs to unpick significant laws in some areas of trade mark and design protection, and legislate new paths. The current unitary (EU-wide) regimes for trade mark and design protection will have to be undone somehow. Should a unitary right be split into two parts, covering the UK and the remaining EU? Or should an existing EU right give its holder a right of seniority in an application for a UK right? The UK needs a strategy on this, and soon.

In relation to designs, businesses that have been relying on unregistered Community protection should consider, as a matter of priority, obtaining registered protection. If you have disclosed the design, the clock is already ticking to get a registration on the books before you are prevented from doing so.

From a practical perspective, businesses should also be aware of the need to ensure that terminology used in licences, settlement agreements, co-existence agreements and other transactional arrangements is now drafted in such a way that the extraction of the UK from the EU and unitary IP right systems can be accommodated without a need to re-open negotiation of the contractual terms. In the course of time, existing arrangements which cover the EU as a defined territory, or which concern EU IP rights, will need to be reviewed in order to consider whether they will remain fit for purpose following Brexit.

For more on the issues raised in relation to intellectual property rights generally, please see our article " Brexit - what next for intellectual property?".

It is also worth noting that tax incentives (including the UK's Patent Box scheme) for the location of research, innovation and development work in the UK should now also be considered as a priority by the UK Government.

Concluding comment

Many sectors will, to a greater or lesser extent, be affected by an exit of the UK from the EU; and the implications for the life sciences sector are potentially significant. The sector has become used to working under laws and regulations which apply on an EU wide basis. Many UK laws, like the Human Medicines Regulations 2012, are EU-based, and many drugs are now authorised under a single authorisation which has brought significant efficiencies to applying for and obtaining marketing authorisations in the EU. The unitary patent and the UPC would have added to those efficiencies and increased the attractiveness of the EU, and therefore the UK, as a place to do business in the sector.

However, irrespective of any Brexit, the UK's wider legal and regulatory structures provide a progressive and outward-looking environment for business. With the right leadership and strategy, this can be built upon further in the event of any Brexit. We have every confidence that the UK will remain a leading global hub for life sciences investment, innovation, research and development.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
7 Nov 2019, Seminar, Birmingham, UK

Providing content specifically tailored to the needs of GCs and Heads of Legal working in government organisations and their affiliates.

14 Nov 2019, Seminar, London, UK

Providing content specifically tailored to the needs of GCs and Heads of Legal working in government organisations and their affiliates.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions