Nine months after the Brexit vote, the full ramifications of Britain’s decision to leave the European Union remain far from certain. That’s especially true for the United Kingdom’s medical technology industry. Questions abound, ranging from what regulations might change to where the European Medicines Agency (EMA) will move.
One thing is clear: Ireland’s medtech sector stands to gain from Brexit. While the UK is Ireland’s close neighbor and biggest trading partner, the countries have been rivals in the competition for new investments by medical device companies and biopharma businesses.
Today, both nations boast thriving medtech sectors. But the British departure from the EU, scheduled for some time after 2019, will create opportunities for Ireland to capitalize on its unwavering membership in the continent’s single market, both in the short and long term.
Ireland offers certainty and clarity for companies seeking to solidify their access to the Eurozone’s remaining 27 member countries. That certainty ranges from the device/drug-approval process to the unhindered sale of products and materials.
Another major factor in Ireland’s favor: It will become the sole English-speaking country in the EU when Brexit is invoked. That business-language advantage is complemented by Ireland’s pro-business environment, competitive corporate tax rate at 12.5%, innovation and skills, as well as its common law system.
In the last two decades, Ireland’s open economy has helped create one the world’s premier medtech ecosystems. Thirteen of the top 15 global medtech companies have operations here. Indeed, the Republic of Ireland is the No. 1 European location-of-choice for new foreign direct investment (FDI) in medical technology. In addition, over the last two years alone, Ireland has secured $5 billion worth of new biopharma business.
Strong Human Capital
The economic and demographic factors that have attracted giants like Medtronic, J&J and Abbott, to name just a few, as well of hundreds of small and mid-sized medtech companies, have only been enhanced by the Brexit vote last June 23.
Ireland is already home to one of Europe’s youngest and best-educated workforces. While the majority of the country’s medtech workers are born and bred here, Ireland has benefitted from an influx of multilingual and technical talent from the continent, which spans the life sciences and technology sectors. That’s a positive trend for the industry at large, because the skill sets required of workers are continuously evolving and aligned to technology convergence.
Immigration was the major issue in the Brexit vote, so the UK is all but certain to curtail the current freedoms allowing EU nationals to live and work there. But with its open borders, Ireland can continue to draw expertise from the continent without the need for a visa.
Britain’s departure may mean more EU funding for R&D in Ireland. Under programs such as Horizon 2020, EU member states can access €75 billion set aside to spur scientific breakthroughs and discoveries, and in turn, increase Europe’s global competitiveness. In the post-Brexit age, this money will no longer be available to organizations within the UK.
Any new funding benefiting Irish organizations would augment the already high-caliber medtech innovation occurring here. One example: The Stryker division in Ireland has established a 17-year track record in the development and launch of new surgical instruments.
Irish medtech operations also have become leading recipients of the prestigious Shingo awards, which recognize operational excellence. These honors speak to the quality, talent and focus on zero-defect manufacturing among highly regulated Irish locations.
Ireland = Eurozone
Whether and how UK medtech regulations will diverge from the Eurozone’s remains to be seen. The UK EU Life Science Steering Group is analyzing the potential impacts of Brexit and will make recommendations to Prime Minister Teresa May during the two-year transition, which is now under way.
There’s only slightly more certainty about what will happen with EMA, the European equivalent of the FDA. Around 36,000 national regulators and scientists from across the continent annually come to the agency’s London headquarters to approve the safety and efficacy of drugs for the EU’s 500 million people.
The agency already has announced it will move from its London headquarters because it is fundamentally an EU institution. Exactly when and where the agency will relocate hasn’t been decided, and Ireland is setting forth its business case as the new home for EMA.
The overall uncertainty surrounding Brexit was among the reasons cited by Almac Pharmaceutical last month, when it announced the opening of a new facility in Ireland. The continuity of access to the European market and the continent’s skill set was a significant factor in the company’s decision.
IDA Ireland—the agency responsible for attracting and developing foreign investment in the republic—counts Almac as the first biotech company it’s landed because of Brexit. The IDA will continue to promote Ireland as the ideal location for companies around the globe looking to ensure that they have a presence in the European single market. Ireland is steadfast in its policy commitments to maintaining its proposition of stability, clarity, certainty and openness to international businesses.