The UK regulatory environment for medicines and medical devices is undergoing significant changes, providing new opportunities.
This includes enabling companies to apply for UK authorisation based on product authorisations from another trusted market, such as the US.
This will allow medical devices companies additional time to transition to the future requirements and provide more detailed guidance to support compliance of AI and software medical devices.
Earlier this year, the UK Medicines and Healthcare products Regulatory Agency (MHRA) announced the introduction of new international recognition routes for approving medicines that are already authorised in Australia, Canada, the European Union (EU), Japan, Singapore, Switzerland or the US.
The new International Recognition Procedure (IRP) will start from 1 January 2024.
The IRP will provide a fast-track UK application process for products already licensed in a trusted partner market, known as a Reference Regulator (RR), with MHRA still having final decision-making power as to whether to approve the product.
The IRP will build on MHRA’s current European Commission (EC) Decision Reliance Procedure, which provides an expedited 67 day process for marketing authorisation applications for Great Britain based on the European Commission’s decision to grant an EU centralised marketing authorisation (MA).
It also complements the UK national authorisation process and accelerated access route, including the Innovative Licensing and Access Pathway (ILAP).
The introduction of the new international recognition routes is a milestone development in the UK’s medicines regulatory framework, with the MHRA recognizing authorisations from outside the EU for the first time. It also presents interesting strategic questions for companies as to which Reference Regulator to rely on for their UK application.
The licensed indication for a product may be broader in one trusted partner market than another, with the first trusted partner market authorisation to be issued not necessarily being the broadest.
New concepts
In the UK, pricing and access is also at a crossroad moment. The cost of branded medicines to the NHS is currently controlled under the 2019 Voluntary Scheme for Branded Medicines Pricing and Access (VPAS), or for companies choosing not to be a VPAS member, under the statutory scheme set out in the Branded Health Service Medicines (Costs) Regulations 2018.
The VPAS and statutory scheme are broadly commercially equivalent. The 2019 VPAS will expire at the end of 2023 and companies are deciding whether to be members of the future voluntary scheme, the 2023 Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG), announced on 20 November 2023, or the statutory scheme.
The Department of Health and Social Care (DHSC) has recently consulted on amendments to the existing statutory scheme.
VPAG includes a new approach that sets differentiated payment rates for newer products still within patent protection and older products, with further differentiation for older products based on whether competition has reduced pricing.
Such a concept marks a significant shift in the how the controls on allowed growth in sales of branded medicines to the NHS is effectively allocated across different stakeholders within the industry.
Generational change
The UK Medical Devices Regulations 2002 (UK MDR) still reflects the EU medical device legislation in place prior to Brexit, while in the EU, medical devices legislation has undergone the most significant rewrite in thirty years in the form of the EU Medical Devices Regulation and In Vitro Diagnostic Regulation (EU MDR and EU IVDR, respectively).
The MHRA has consulted on changes to the UK MDR which are likely to bring it broadly in line with the EU MDR and EU IVDR, representing a generational change in the UK medical device regulatory framework.
The first tranche of that change is progressing through the legislative procedure in the form of the Medical Devices (Post-market Surveillance Requirements) (Amendment) (Great Britain) Regulations 2023.
The UK has prioritised implementing changes to post-market surveillance (PMS) to help ensure that any safety concerns once a device is on the market are identified and addressed as quickly and robustly as possible.
The draft 2023 Regulations are interesting not only in setting out the proposed new PMS regime, but also in terms of the structure and tenor of the overall new regulatory regime being developed.
In particular, the alignment in most, though not every, respect with the EU MDR/EU IVDR will make compliance simpler for those manufacturers also operating within the EU.
The remaining changes to the UK MDR are currently anticipated to be in place by mid-2025. There is increasing pressure, however growing at EU level to make changes to the EU MDR/IVDR to address systemic and capacity issues.
This is likely to play out at the same time as the UK is developing the amendments to the UK MDR.
The UK’s own version of the EU CE mark, the UK Conformity Assessed (UKCA), has already been incorporated into the UK MDR. CE marked devices are still accepted in Great Britain – initially this was until 30 June 2023, but is now extended to 30 June 2028 or 30 June 2030, depending on the type of device in question.
This so-called “standstill period” has been extended this year to allow time to transition to the UKCA regime for medical devices, giving manufacturers the choice to either comply with the UKCA regime or with the CE regime.
As part of these reforms, the MHRA is taking a lead on another generational shift – the exponentially increasing numbers of software and artificial intelligence products that qualify as medical devices and the challenges of how manufacturers can demonstrate that such products meet the safety and performance requirements in the UK MDR.
The MHRA has established a dedicated programme of work that includes developing detailed guidance for manufacturers on software and AI as a medical device.
Licensing impact
The shifting regulatory landscape also raises strategic questions for licensing and collaboration agreements. Companies need to consider whether the upcoming changes affect their existing and/or future agreements, which often span the entire lifecycle of a product.
As the UK system continues to evolve post-Brexit, the regulatory profile of a product across multiple jurisdictions may differ and will likely impact the complexity of core license terms.
Companies will also need to consider the interplay of the impact of law changes elsewhere, such as the Inflation Reduction Act of 2022 (IRA) in the US, the new Unitary Patent and Unified Patent Court (UPC) and the proposed changes to regulatory protection periods under the EU Pharma Law Package in the EU, on their transaction structures.
While cross-jurisdictional legal issues can become complex, the contractual provisions addressing them need not be and can help mitigate risks associated with changes in the legal and commercial regulatory landscape over the lifetime of a transaction.
Jane Summerfield, partner, is Co-Head of Hogan Lovells’ Life Sciences & Health Care industry sector.
Penny Powell, partner, focuses on the life sciences, technology and automotive industry sectors at Hogan Lovells
