Brexit Will Be Bad For Pharma

In this nice piece of article on Forbes, http://www.forbes.com/sites/stephenbrozak/2016/06/25/brexit-will-be-bad-for-pharma/#398890a57ab3 the author highlights the impact of Britain's potential exit from the European Union on the pharmaceutical industry.

Summary:

1. Big Pharma’s balance sheets just took a hit:

Between the UK and the EU, most large pharmaceuticals have more than 20% of their sales in the region; as a result, these companies will be working the numbers this weekend to see how their performance will be affected by Brexit and the ensuing financial chaos.

2. The healthcare capital markets have now come to a screeching halt:

With a decompensating banking system, the UK’s financial chaos will certainly have a domino effect across the rest of the continent. Management teams will be distracted, layoffs will certainly ensue and, once that happens, meaningful R&D will slow down as workers begin to worry about their jobs.

3. Even the EMA is a question mark:

The European Medicines Agency (EMA) is the pharmaceutical regulatory agency for Europe. Right now, the word is: “Don’t panic. No changes soon.” Nice to know, since EMA headquarters is Canary Wharf, London.

4. The downsides of inversions:

As EU cohesion and European financial instability become issues, tax laws as well as trading relationships are in play.

Remember: Pharmaceutical and medical device companies aren’t just service providers. They are among the largest industries in the world. They require stability. And suddenly, we don’t have it.