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EU members line up to host EMA headquarters, regulator seeks to calm pharma sector by reporting business as usual

Published: 7/8/2016

Several European Union (EU) countries have begun building their diplomatic and political cases for the possible transfer of the European Medicines Agency (EMA) headquarters from London.

IHS Life Sciences perspective


Acquiring the EMA headquarters will be a political and regulatory coup for whichever country succeeds. The successful candidacy is likely to significantly raise the investment profile of the host country in the pharmaceutical and life-science sectors.


At present, it remains too soon to deduce which of the candidate countries has the strongest overall bid – although Italy is perhaps an early front-runner, and has to date invested the strongest political support in the project. From 2017/2018 onwards, EU member states are likely to begin assessing the details of the nominated countries' applications, with a view to eventually creating a shortlist for final consideration. To be in contention, countries will need to generate political support at an EU level, and this process will tend to favour the larger EU countries over smaller members.

On 6 July, the European Medicines Agency (EMA) issued a reassuring statement noting that medicine-approval procedures and regulations would be unaffected by the United Kingdom's decision to leave the European Union (EU). The pan-European medicines regulator cautioned that there was "no precedent for the situation", and that there were medium-term implications for the "seat and operations of the EMA". However, the agency declined to speculate on the interest expressed by several member states in hosting the agency in future, except to say that this decision would require "common agreement" between EU countries and was not up to the agency itself.

Italian bid builds an early lead in the race to host the EMA

Italy has emerged as a strong challenger, given that EMA executive director Guido Rasi in addition to a high proportion of the agency's permanent workforce (12.43%), are Italian nationals; Italy ranks second after France (12.77%) and ahead of Spain (10.51%) with the highest proportion of full-time EMA staff.

Milan mayor Giuseppe Sala has also been reported in Italian media as stating that the government must act quickly to head-off competition for hosting the EMA. According to news source IlSore24, Sala has already held preliminary meetings with the EMAs Guido Rasi this month. The local Milanese administration is also understood to be preparing a dossier for the central Italian government presenting the merits of its case. Government officials in Milan are believed to have identified a site near the Human Technopole EXPO research and exhibition centre on health and ageing as a possible future location for the EMA. The EUR1.5-billion (USD1.6 billion) multi-phase project is scheduled for completion by 2040, and will consist of seven research centres. If completed according to schedule, the 30,000-square-metre site will eventually be capable of accommodating about 1,500 researchers and technicians.

The potential downside to Italy's eligibility as a destination for the EMA likely centres on lingering concerns over the country's political stability. An upcoming referendum in October on reforming the country's political system risks failure; this holds significant potential to topple Prime Minister Matteo Renzi's government, and prompt destabilising early elections. Such an outcome could result in heightened political uncertainty in the country over the coming years, accompanied by the rise of populist political parties led by the Five Star Movement (Movimento 5 Stelle: M5S) and a significant weakening of the main centrist parties on both the centre-right and centre-left of Italian politics.

An additional factor against the Mediterranean country becoming the preferred choice is the risk that political pressure from M5S in Italy is building for an in-out referendum on Italy's membership of the EU. Furthermore, although a tangential issue, Italy's bid could be undermined by ongoing economic issues surrounding the future of the Italian banking system.

Ireland emerges as a strong outside contender

The Irish government, supported by the pharmaceutical division of influential lobby group the Irish Business and Employers Confederation (IBEC), has indicated that it will undertake a serious bid to attract the EMA to Ireland. In some considerations a decision to relocate to the Irish capital, Dublin, would be logistically and administratively a more straightforward transfer for the EMA to undertake – in terms of geographical distance to London, and that Ireland is the only English-speaking country in the eurozone. Additional advantages in Ireland's favour include the country's large export-orientated pharmaceutical industry, which already hosts the EU headquarters of several of global pharmaceutical companies. The pro-business government, and the country's well-respected foreign-investment agency (IDA), are likely to present a strong case for consideration.

Support could swing to Sweden or Denmark

Nordic countries Sweden and Denmark began preparation of contingency plans to host the EMA headquarters several months prior to the UK referendum (see Sweden - Europe: 26 February 2016: Pharmaceutical association positions Sweden to host EMA in event of BREXIT). Despite its small size, Sweden is particularly well placed to become the next base for the EMA. On a political level, the country has relatively strong pro-EU credentials, and is regarded as politically and economically stable, and therefore a potential safe harbour for the medicines regulator.

Migrating the EMA headquarters to the city of Stockholm would bring a number of advantages, not least of which are practical considerations including strong inter-European transport connections and relatively affordable cost-of-living standards. Alternatively, the Danish capital Copenhagen offers a number of advantages, and has the added incentive that the country is already home to large export-orientated pharmaceutical players (such as Novo Nordisk).

Neither the Swedish nor Danish governments have declared their support for an official bid, although this endorsement is expected to be a formality.

France and Germany should not be discounted in the race

Officials from the eastern French city of Lyon, which boasts the presence of several pharmaceutical companies including Sanofi (France), have also staked a claim for the EMA headquarters; in addition, city officials wrote to President Hollande on 1 July to lobby on behalf of Strasbourg. The Strasbourg region is within 130 kilometres of sites owned by Daiichi Sankyo (Japan) in Altkirch, and less than 50 kilometres from the Basel headquarters of Switzerland's Novartis and Roche. However, Strasbourg already has the European Directorate for the Quality of Medicines and Healthcare (EDQM) and the European Parliament on its doorstep; this may create a perception among other EU countries that France is home to too many EU institutions, which could dampen support for a French bid to acquire components of the EU regulatory infrastructure. Spain and Italy may well have the best case for arguing that, despite being large European countries, they lack a sufficient share of EU bodies and agencies in their territories.

German officials in Frankfurt have voiced interest in attracting London-based EU institutions to the city. However, in general, there has been a lukewarm reception regarding the EMA, and greater excitement over the prospect of housing the European Banking Authority (EBA). Frankfurt would be a natural choice for the EBA, given the potential proximity to the European Central Bank (ECB). Moreover, since Frankfurt is unlikely to be permitted to host both institutions, the city may exert greater lobbying efforts upon its candidacy for the EBA rather than medicines agency.

Spain increases lobbying efforts

In recent days, the Spanish government has declared its interest in hosting the EMA, and is being supported by the country's association for the innovative industry sector (Farmaindustria). Madrid would offer the excellent policy credentials of the Spanish Medicines Agency and highly-developed infrastructural support capability to operate the EMA headquarters (see Europe - Spain: 7 July 2016: Spain's Farmaindustria backs government bid to host EMA headquarters).

Outlook and implications

The decision by the United Kingdom to invoke Article 50 of the Lisbon Treaty will trigger a truncated two-year battle among European capitals and cities for the privilege of hosting the EMA institution. Pharmaceutical manufacturers and innovative industry associations are set to wield a strong influence in these negotiations. EU member states will desire to avoid an excessive concentration of EU authorities in one member state, with the result that countries that have few or minor EU agencies at present – such as Italy and Spain – should be able to build a strong diplomatic case. However, the relocation of other EU bodies from London – such as the EBA and the Unitary Patent Court – may complicate the political decision.

The move to discontinue operations in London and re-establish a base in a remaining EU state is liable to be a costly and complex undertaking; the relocation will also pose a significant administrative burden for the EMA. Disruption to the drug-approval process and/or delays can be minimised, are not inevitable; however, there is undoubtedly a need for European officials to increase efforts to assuage industry concerns over regulatory approvals potentially being negatively affected, and to ensure that regulatory divergence between the EU and UK is contained.

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