At the end of the week in which prime minister Theresa May officially invoked Article 50, thus triggering the process of exiting the EU, MTI editor Dave Gray looks at the possible outcomes for medtech.
Now that the die has been cast, it’s time for the deal-making process to begin – if indeed a deal is on the cards. It seems that every time a new milestone is reached in the uncharted waters we call Brexit, the ripple of uncertainty sends waves through the UK’s manufacturing market.
One of the questions of course revolves around CE marking – that distinctly European standard. Conformance, a specialist consultant in CE marking in the UK states on its website that in the long term, there will indeed be “some divergence” between the UK and the EU in terms of standards for product safety.
Whilst CE marking will still be required for trade into Europe however, it remains to be seen what the impact will be on UK medical device manufacturers only trading internally.
Conformance believes it is most likely that the UK will continue to adopt CE marking on its own shores post-Brexit.
In any case, sticking with the CE mark, regardless of territories, could be preferable for many medical device OEMs. The cost and headache of evaluating and implementing a ‘UK-only’ set of standards do not make for desirable business conditions. In short, better the devil you know, perhaps.
Also, consider the possibility that ‘UK-only’ standards could be, in some areas more lenient than their EU counterparts.
This would surely provide opportunities in terms of competitiveness, but would become frustrating for those firms reliant on exporting to Europe.
Either you have to make two versions of the product, likely at cost, or forego the supposed benefits afforded by Brexit in the first place.
But what about David Cameron’s once famous stark warning that Britain will be ‘on the outside looking in’ where European rules and laws are concerned?
It’s probably safe to say that if we make a very clean break from Europe, or ‘hard Brexit’ as it’s known, the UK will lose its voice in the setting of new standards.
That said, as manufacturers and MPs are increasingly pushing the notion of the UK rejoining Efta (the European Free Trade Alliance) onto the PM’s desk, a softer approach would likely come with the reward of heavier involvement in future decision making.
Aside from CE marking, it’s likely that Brexit will affect innovation across medtech – in particular where the young digital health market and its startups are concerned.
Whilst the US tech giants are diving into the UK with investment left, right and centre, the picture is a little different for healthtech startups.
The STEM skills shortfall is, according to some, rapidly approaching crisis point. While the government is seeking ways to bridge the gap in the long term, the short term solution would’ve been overseas talent.
Of course, as we know, the prospect of Brexit overshadows that.
Regardless of whether or not the UK government ends up placing restrictive immigration measures that throttle the influx of skills, it is assumed that moving outside of the EU will have a negative impact on perceptions. Simply put, in spite of all the inevitable diplomacy
Thankfully, the medtech market is not typically churned up by fluctuations in consumer spending. Inevitably we’ll encounter economic troughs, both at home and overseas as details of the Brexit negotiations begin to emerge. But the demand for high quality British medical devices and equipment isn’t likely to disappear any time soon.
