This statement sets out the analysis used to support the development of the mandatory validation regime for covid-19 tests before they can enter the UK market. This goes alongside the full impact assessment, which we have published.
Testing will continue to form a crucial part in the response to covid-19. Consumers must have confidence in the performance of tests they use. That is why the Government are bringing in draft legislation under the Medicines and Medical Devices Act 2021, which will require all antigen and molecular covid-19 tests to undergo mandatory validation to assess their performance before being permitted for sale on the UK market. This will ensure that any covid-19 test on the UK market meets a minimum standard, the same standards as those met by covid-19 tests procured for the NHS.
We have engaged with the Regulatory Policy Committee (RPC) throughout our work to ensure that our analysis meets the high standards the committee upholds. We thank them wholeheartedly for their constructive feedback and for working at pace to meet an unusually tight legislative timetable.
While the Department is working to produce a revised impact assessment, we intend to publish the current draft in the interim for transparency. In developing this assessment, we brought together regulatory knowledge in an area where we have not innovated policy for decades, alongside the ongoing challenges of modelling both economic and epidemiological predictions. We were unfortunately red rated in one key area which has resulted in a red rated IA. While I am obviously disappointed in this rating, we remain committed to working closely with the RPC to ensure that we produce a final IA that we are all satisfied with and proud of, making use of the latest data from a nascent and rapidly evolving market.
The analysis to date strongly supports our planned policy intervention. This is a necessary regulation to protect consumers and give reassurances to producers. While we do recognise the potential profit loss for companies whose products do not meet the required standards, this is a necessary move to ensure the highest-quality tests are available to protect consumers and public health. We have looked carefully at this and are committed to work closely with these producers to ensure they understand the requirements and can work to achieve them. Furthermore, the potential profit loss needs to be set against the additional profits that manufacturers who are producing high-quality tests that meet the validation standards could potentially gain, and the benefit to society of removing poorly performing tests and associated public health impacts.
The RPC has identified areas for further development, which include:
The need to enhance our analysis of the latest evidence of the share of the market for covid-19 tests which are accounted for by businesses based in the UK. This determines whether business impacts are reflected in the equivalent annual net direct cost to business (for businesses based in the UK) or as trade impacts (for businesses based elsewhere).
The need to test with stakeholders (or otherwise confirm) our assumptions about the proportion of devices presenting for validation (currently assumed to be 60%)—this affects profit/EANDCB/trade impacts since products not validated will be removed from the market) and the life cycle of devices (currently assumed to be 1-5 years—this affects programme costs in determining how frequently manufacturers need to submit devices for validation)
The need to explain further how we have:
extrapolated from third party estimates of the future size of the private testing market size;
established and treated stakeholders’ estimates of market profit margins; and
estimated familiarisation and transition costs, including the use of any non-wage uplifts.
The need to add new content (and test with stakeholders - or otherwise confirm) to address:
familiarisation costs incurred by retailers; and
how devices online will be monitored and enforced.
The RPC fulfils a crucial role in ensuring that analysis and evidence in regulations are robust and assessed to an extremely high standard. The Government are committed to this process and in relation to this policy, we are determined to ensure the impact assessment we complete includes the best possible research and evidence available.
The impact assessment is a living document, used to support the process of policy design and implementation. We plan to make further iterations of this impact assessment publicly available ahead of the next statutory instrument we intend to lay in the autumn, which will introduce a second element of laboratory validation.
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