Make, break or fudge: How 2018 will redefine the European regulatory landscape

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While the EMA faces a tough but known challenge, the situation awaiting the U.K. is undefined.

Next year will be a busy time for the European Medicines Agency (EMA). Having been cast out of its London home by the Brexit vote, the regulator has until the end of March 2019 to complete its move to Amsterdam. That represents a tight timeline for a 900-person agency constrained by the pace of European Union processes. But it is arguably less daunting than the uncertainty facing the country it is leaving behind.

After 18 months of uncertainty, we now know some things about the future of drug regulation in Europe. The EMA’s new home is Amsterdam, a location favored by many of its staff members. That means the most cataclysmic predictions about the ability of the EMA to function after Brexit are unlikely to come to pass.

Barring a shock, the EMA will retain enough staff to maintain its core activities, but some secondary tasks—such as antimicrobial resistance initiatives—may grind to a halt. It is also possible that approvals and other regulatory processes will take longer than normal. How bad the situation gets and how long it lasts will depend on multiple factors, including the speed with which other countries can fill functions currently handled by the U.K. regulator.

RELATED: EMA, facing a Brexit-shaped hole, moves to add staff

Another factor is the need to divert staff and money to the relocation process. The EMA needs to get 900 employees—plus their spouses and 600 children—set up in Amsterdam in offices that meet its needs by late March 2019. With building work taking up to 15 months and authorizations typically requiring up to eight months, the agency will need to speed up processes or run them in parallel. The European Commission plans to start the building contract process by early next year.

While the EMA faces a tough but known challenge, the situation awaiting the U.K. is undefined. The government set out its preferred relationship with the EMA after Brexit earlier this year in a public letter, in which it called for the U.K. to seek the “closest possible regulatory equivalence.” That is in line with the wishes of industry, which is lobbying for as little to change as possible. But the U.K.’s ability to secure such a relationship is entangled in a political thicket.

Some citizens and politicians in the U.K. want to see the country sever its ties to the EU, freeing it to rewrite its regulations and seek trade deals with the rest of the world. Others think the U.K. is best served by keeping its regulations in line with those of the major trading bloc on its doorstep, the EU.

If one of these positions wins the debate, it will dictate whether the U.K. regulatory system goes it alone—something it is ill-equipped to do today—or becomes an adjunct to the EMA that follows the EU-wide agency’s rules and approval decisions.

RELATED: U.K. politicians push for cooperation with EMA post-Brexit

Brexit has made fools of soothsayers from the referendum result onward. But this observer would be unsurprised if 2018 ends much like 2017 has, namely with a fudged agreement that buys both sides time. The first round of talks ended recently with the U.K. largely acquiescing to EU demands, and with the EU largely allowing the U.K. to delay answering the intractable question of the Irish border.

If the second round ends the same way, the U.K. could stay in the EU-wide regulatory area, in spirit if not in name, for a transition period. That would kick the final decision on the U.K.’s regulatory system and other matters down the road for another two years, at which point another agreement could delay it yet again.

Nobody would be happy with this situation, but, equally, it may be tolerable enough that nobody tries to bring down the government. And there is precedent for such procrastination. Norway signed a seemingly temporary deal covering its relationship to the EU in 1992.

That agreement is still in place today.