In Friday’s post-Brexit scramble many biopharma companies downplayed the importance of the UK, despite being one of Europe's five biggest markets. According to forecasts made before the EU referendum was held, the UK – or more accurately England and Wales, the only areas for which data are available – will be worth €27bn in 2022, making up 13% of the EU market.
EvaluatePharma’s European drug forecasts module shows that Bayer (OTCPK:BAYRY)/Regeneron’s (NASDAQ:REGN) Eylea will be the best seller in the UK in 2022, taking over from AbbVie’s (NYSE:ABBV) Humira, which was the top drug in 2015 (see tables below). Regeneron has said that the UK’s withdrawal from the EU would have little impact on its revenues, while AbbVie believes that the country accounts for only around 3% of its total sales.
Brexit seems unlikely to make a mark on most big pharma companies, but the smaller players could be hit if investment becomes harder to come by. It could also have a knock-on effect on innovation if UK universities, one source of new biotech groups, lose out on EU grants.
It is somewhat surprising that Eylea is in the UK top spot: the wet age-related macular degeneration treatment is only forecast to be the 17th-biggest seller in the US in 2022, with revenues of $4.6bn.
It also does not fare so well in the other big European nations, being only number 10 in Germany and number five in France, and not even making Italy's top 10 in 2022.
This could be explained by the UK’s strict approach to drug pricing. Bayer has agreed a patient-access scheme with the UK’s Department of Health, but does not give details of the discount that is applied to Eylea.
The only recently approved drug in the UK table is Bristol-Myers Squibb’s (NYSE:BMY) checkpoint inhibitor Opdivo – which is perhaps indicative of the country’s stance over expensive new drugs. Opdivo is forecast to be the top drug in France and Italy, and number three in Germany, in 2022.
One product that looms large in the US, but not so much in Europe, is AbbVie’s Humira. The discrepancy could be explained by the expected impact of biosimilars, which have been embraced by the more cost-conscious European nations – some more so than others.
While the impact of Brexit on marketed drugs is arguable, the picture looks less rosy for drugs that do not yet have approval – particularly if the worst-case scenario happens and the UK ends up with a separate regulatory system.
If this does come to pass “the reality is that the UK process would come second”, Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry, told EP Vantage. “A rational decision from a pharma company would be to get registration in a market which will give 500 million patients access to the medicine versus 60 million patients.”
It is still unclear whether this will happen, as the details of Brexit are yet to be hammered out. The ABPI hopes not, and has highlighted the UK’s importance in the EU regulatory process (Sector licks its Brexit wounds, June 24, 2016).
Too much is still unknown to say what impact Brexit might have on the UK biopharma industry. For now, the likes of the ABPI are saying it is business as usual; whether the markets heed this message is another matter.
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