The UK and US have a deep and enduring trading relationship, fostered over many years of economic cooperation, shared cultural values and global geopolitical partnership. Today, in the context of worldwide political and economic uncertainties, not least the UK’s decision to leave the European Union, it is critically important that this relationship continues to thrive in the interest of mutual prosperity for all.
Discussions between London and Washington on a new trade deal are intensifying, with the United States Trade Representative (USTR) having formally notified Congress of the Trump Administration’s intent to begin trade negotiations. Enhanced transatlantic cooperation offers many potential opportunities, but we already have a strong base from which to build.
In the biopharmaceutical sector, the UK exported more than $5.5bn in medicines to the US in 2017, with imports valued at over $3.6bn moving in the opposite direction. UK companies are the single largest investor in the US, investing $569bn as of the end of 2015, and play a major role in America’s high-value life sciences sector, with pharmaceuticals accounting for more than two-thirds of R&D spending by UK firms in the US.
Meanwhile, US companies account for nearly a quarter (24.5 per cent) of the UK’s total inward investment, supporting 1,349,000 direct jobs. This mutual relationship has become an essential part of the UK economy and has helped to drive growth in many of our key sectors, including life sciences.
Lilly is a global biopharmaceutical company with a long history of investing in the UK, having opened the door to our first UK site in 1934. We now employ around 1,000 people across two sites in Erl Wood (Surrey) and Basingstoke (Hampshire). In the last ten years, we have invested £1.9bn on UK R&D, including £48m of investment into Lilly’s Centre for Cognitive Neuroscience at Erl Wood, our largest research facility outside of the US.
The current lack of clarity on the UK’s future relationship with the EU has presented a number of very significant challenges for our business and we continue to urge all sides to agree a way forward that maintains close cooperation with the EU on medicines regulation and cross-border movement of goods.
Nevertheless, as an American business with a large presence in the UK, we are keen to ensure the government makes the continued growth of UK-US trade a top priority, increasing opportunity for investment and ensuring UK patients continue to access the latest life-saving medicines.
On 27th February Lilly UK, in partnership with BritishAmerican Business (BAB), hosted a roundtable discussion bringing together key stakeholders from Parliament, the Department for International Trade, the Medicines and Healthcare Products Regulatory Agency (MHRA), the US Embassy, business organisations, industry bodies and think-tanks, to discuss the future of Britain’s international trade policy.
From the discussion key themes emerged that, if put in place, would send a strong message to global executives that the UK will remain a leading life sciences hub post-Brexit, with a pro-innovation environment that can drive inward investment and maintain global economic competitiveness.
For example, it is clear that robust and effective regulation sits at the very heart of a strong life sciences ecosystem. With the right frameworks and standards, good regulation provides a predictable and transparent market that promotes trade, attracts investment, enhances medicines discovery, and accelerates patient access to the latest innovative products.
Building on common ground and increasing regulatory compatibility between the US Food and Drug Administration (FDA) and the UK’s MHRA can help optimise regulators’ resources and reduce costs for industry, enabling more money to be spent on medical research. As a simple example, both the UK and the US maintain high regulatory standards on inspection of drug manufacturing sites.
Mutual recognition of those standards, which enables regulators to recognise each other’s inspections without carrying out duplicative inspections of their own, can result in significant cost savings for both industry and regulatory agencies.
The UK recently signed a Mutual Recognition Agreement (MRA) with the US on Good Manufacturing Practice (GMP) inspections, replicating an existing agreement between the EU and the US. This is a positive and pragmatic step to streamline regulatory processes, avoiding costly additional and replicative bureaucracy and providing a good base for further cooperation on joint regulatory protocols.
As science and technology evolves rapidly, and technologies such as AI, computational biology, digital innovations and personalised medicine present exciting new therapies for patients, regulators on both sides of the Atlantic face similar challenges in how to regulate novel and emerging technologies.
Exploring how enhanced transatlantic cooperation can support aligned regulatory approaches in these fields can help minimise duplicative or inconsistent requirements that may act to slow or inhibit new treatment options from reaching patients. Trade discussions with the US provide the perfect forum to explore how the UK and US can set international gold standards in these emergent areas.
Another important area discussed was that of intellectual property (IP). IP is the lifeblood of the innovative pharmaceutical industry, providing innovators with the security required to invest in the long, complex, risky and extremely costly process of delivering new medicines to patients – a process with costs running into the billions of pounds for a single successful product.
As part of a future trade deal, the US and UK have a key opportunity to reaffirm their existing commitment to high standards of IP protection, demonstrating global leadership to secure the highest international standards in the interest of promoting cutting edge medicines research.
The UK has a fantastic platform for success but there is always room for improvement in supporting the life science sector’s critical place in the national economy.
The process for getting new medicines to patients in the UK is still slow, especially compared to other advanced economies, and more can be done to build positive partnerships between industry and the NHS. The threat of Brexit also continues to loom large. Taken together, these issues remain a significant barrier to UK investment for many global companies, especially in the face of rising competition in the US, Asia and other European countries.
But with an outward-looking trade agenda, forging new deals with countries like the US has the potential to secure a better future by facilitating the development of new medicines, improving health outcomes, and supporting long-term economic growth. In this respect, the UK can cement its global leadership position in the life sciences, positioning itself as a leading adopter of innovation at pace and scale, and in doing so send a strong signal to international boardrooms that the UK remains open to global investment.
David Talbot is senior director of international government affairs at Eli Lilly and Company.
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