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Brexit and the Impact of the Divorce Principles on the Life Sciences’ Talent Pool

The impending exit of the United Kingdom from the European Union – known as Brexit – has thrown the Life Sciences industry into a state of panic. What will the impact be to employment, the UK’s standing as a global leader in the life sciences and pharmaceutical sector and access to available talent in Europe?

In early December 2017, the Brexit Divorce Principles – the key negotiable objectives of the first phase for the United Kingdom’s (UK) impending exit from the European Union (EU) were finally agreed.

The three principles core to the ‘divorce’ proceedings are:

  • Guaranteeing the rights of EU citizens
  • Protecting the Irish border
  • Agreeing to foot the Brexit bill

The UK and the EU have also agreed to cooperate on nuclear, police and security issues and agreed to ensure that there will be continued availability of products on the market before Brexit to minimise disruption for businesses and consumers.

On 20 December 2017 the European Commission recommended draft negotiating directives for the second phase of the UK’s withdrawal and as negotiations continue, uncertainty reigns supreme.

Of the many, many concerns raised by Brexit one of the most pressing is the impact leaving the EU will have on the British economy and the labour market.

Despite political posturing, media doomsaying and general disheartenment being expressed by senior business leaders there are indications in early 2018 that the outlook might not be as gloomy as anticipated.

The National Institute of Economic and Social Research has estimated that the UK economy grew by 0.6% in the final quarter of 2017, “driven by both the manufacturing and the service sectors, supported by the weaker pound and a buoyant global economy”.

UK employment rates have continued to rise annually since 2011 (data: Office for National Statistics (ONS)). There are indications that UK businesses are likely to create jobs in 2018: the CBI has found that 51% of firms across the UK will grow their workforce in the year ahead.

There is major unease, however, over the impact Brexit will have on the available talent pool. The ONS has released figures suggesting that net migration dropped by 106,000 in the 12-month period since the Brexit referendum took place. This is the largest fall in any 12-month period since records began in 1964.

According to the Association of the British Pharmaceutical Industry (ABPI) the pharmaceutical industry in the UK employs around 67,000 people directly (25,000 of those in research and development). It contributed £14.5 billion to the UK economy in 2015, with an additional £15.9bn provided through the life sciences supply chain and employee spending. It is an industry worth defending.

In January 2017, UK Prime Minister Theresa May set out the Plan for Britain. The government’s 12 priorities include making Britain the ‘best place for science and innovation’. She acknowledged the importance of the industry to the UK and added, “From space exploration to clean energy to medical technologies, Britain will remain at the forefront of collective endeavours to better understand, and make better, the world in which we live.”

This might sound quite simple in theory but in reality the industry has been wracked by confusion and a pressing concern is the freedom of the movement of highly-skilled professionals between the EU and the UK. The announcement that the European Medicines Agency (EMA) will relocate from its base in London to Amsterdam in the Netherlands added further fuel to the fire of conjecture about the future of the industry in the UK.

A joint paper, written by the Life Science Industry Coalition, including the ABPI says that “brain circulation between the UK and EU27 is mutually beneficial and should continue.” It reports that of the 1.2 million staff employed by the English NHS, 55,000 are EU citizens, including doctors, nurses, pharmacists, paramedics, and care and support staff as well as highly specialised professions such as medical researchers and pharmacovigilance experts. The life sciences ecosystem in the UK extends well beyond the NHS to universities, technological development and research charities. It warns that a cessation to the rights of these professionals to work in the UK may lead to a staffing crisis within the NHS and wider industry, leading to longer waiting times for patients and a winding down in the speed of drug development.

A paper published by the Journal for Pharmaceutical Policy and Practice reiterates that the assurance of free movement will “maintain the high skill level of the workforce in UK universities and the industry as a whole, whilst providing British nationals with the freedom to work, study and gain experience across the EU.”

This will allow multinational pharmaceutical companies to quickly and easily relocate staff, encourage foreign pharmaceutical companies to preserve their UK-based facilities, alleviate concerns regarding their European staff and their ability to attract top talent. “Finally, such an agreement should encourage further foreign investment in the UK.”

A ‘transformative’ Life Sciences Sector Deal between the UK Life Sciences Sector and the UK government was announced in December. The deal will draw substantial investment into the industry and is trumpeted as a step towards ensuring “new pioneering treatments and medical technologies are produced in the UK, improving patient lives and driving economic growth”.

The deal is a key part of Sir John Bell’s Life Sciences Industrial Strategy Whitepaper which includes recommendations for the movement of skilled people and a skills development action plan. A summary of the submission says “with regards to the movement of skilled people following EU exit, it was widely suggested that there should be an immigration system which allows talented and skilled students, researchers and workers to enter and remain in the UK in order to maintain global competitiveness. A number of submissions indicated that an effective skills strategy needs to enhance the focus on STEM subjects in schools and universities.”