Last week, Jeremy Hunt, Chancellor of the Exchequer, published his Spring Budget for the UK. It identified life sciences and digital technologies as “high growth sectors,” which the UK Government wishes to prioritize. Among other things, the Budget outlined the Government’s plans to simplify medicines and technology approvals, plus changes to the regulation and support of digital technologies and artificial intelligence (“AI”). Essentially, the Government wants “the UK to be the best place in Europe for companies to locate, invest and grow” and has announced plans to “strengthen [our] technology and life science sectors.” The Government intends to support those working in these sectors through regulatory changes, as well as better infrastructure and additional funding. This blog post summarizes some of the key announcements.
Quick and simple medicines and technologies approvals
First, the Government’s ambition is for the UK to have the “quickest, simplest, regulatory approval in the world.” Mr Hunt envisions achieving this through two key changes to UK medicines and technology regulations:
- Reliance on foreign approvals.
- The UK Medicines and Healthcare products Regulatory Agency (“MHRA”) will implement “rapid, often near automatic sign-off” for medicines and technologies approved by other trusted regulators, such as the United States, Europe and Japan.
- Going forwards, developers of medicines may be able to prioritize their regulatory approvals in the United States, EU or Japan, rather than preparing a standalone marketing authorization application (“MA”) for the UK. The UK currently has reliance procedures in place for medicines that are centrally authorized by the European Commission or authorized in the EU through decentralized and mutual recognition procedures. The new Government policy will significantly expand the scope of the MHRA’s reliance procedures so that it includes other foreign regulators, potentially increasing the speed to market for pharmaceutical products.
- These new policies will also extend to “technologies.” Given the MHRA has little involvement in the pre-market approval of medical devices, it is unclear to what extent this term includes medical devices. However, we assume there would be scope for the UK to automatically recognize a regulatory approval of a medical device in the United States (such as a 510(k)) or an EU CE-mark for the purpose of obtaining a UKCA mark. It might also give software medical devices benefiting from innovations in regulation, such as the U.S. FDA’s Software Pre-Cert Pilot Program, rapid access to the UK market.
- In any event, the intended upshot of these proposals is that global developers of medicines and technologies will be able to avoid UK-specific regulatory procedures, associated costs and concerns about navigating unique regulatory requirements for the UK market.
- Absent mutual recognition of UK approvals by other regulators, of course, a potential downside of more expansive reliance by UK is that this could limit the MHRA’s opportunities to be a truly innovative regulator. Mindful of this risk, the Chancellor announced some rapid review initiatives.
- Accelerated approval process.
- From 2024, the MHRA will also implement a “swift approval process” for the most impactful new medicines and technologies, such as “cancer vaccines and AI therapeutics for mental health.” In respect of medicines, we note that the MHRA currently offers a 150-day assessment route for high-quality national MA applications and the option for applications to be fast tracked if there is compelling evidence of benefit in a public health emergency or if there is a shortage of supply of an essential medicine. We will need to wait for further detail before we know whether the MHRA will be able to accelerate these timelines even further and what the specific product criteria will be for this accelerated assessment route.
The Government announced £10 million extra funding for the MHRA over the next two years to implement the above ambitions.
The UK also announced its intent to do more to promote innovation and the digital economy. It highlights Patrick Vallance’s Pro-Innovation Regulation of Technologies Review: Digital Technologies Report, noting that the Government accepts all nine of Sir Patrick Vallance’s recommendations. Notably, for those in the life sciences sector, these include the implementation of: (1) regulatory sandboxes (to allow innovators and entrepreneurs to experiment without the heavy burden of regulation and the risk of fines); (2) a clear policy position on the relationship between intellectual property law and generative AI (to provide confidence to innovators and investors); and (3) greater industry access to public data.
The Budget also highlights a number of specific ways it will support AI and digital technologies:
- Investment in infrastructure. “AI needs computing horsepower.” As such, the Chancellor committed to investing around £900 million to build an exascale supercomputer and to establish a new AI Research Resource. This should provide significant computer power for the UK AI community and allow researchers to work on areas such as new drug discovery.
- Quantum Strategy. The UK launched its Quantum Strategy, which includes a research and innovation programme and £2.5 billion of Government investment over 10 years.
- Funding innovation accelerator programmes. The Government will provide £100 million funding for the Innovation Accelerators programme (which covers 26 transformative R&D projects).
- Critical areas of AI. The Government will award £1 million every year for 10 years to researchers that drive progress in critical areas of AI. There is currently no detail of what these areas are nor what is considered as “driving progress.”
- Taskforce on foundational models. The Government acknowledges the importance of foundation models and will establish a taskforce to advance UK sovereign capability to ensure the UK is at the cutting edge of the technology.
- Metaverse. The Government plans to lead the way on regulation of AI and the future of web technology.
The Government’s announcements are a positive step in the right direction. However, as always, the devil will be in the detail. The Covington Life Sciences team is following these developments and will provide further updates in due course.