As part of the Department’s ‘no deal’ European Union exit contingency planning, a tender process to procure additional warehouse space built in the mainland United Kingdom to store stockpiled medicines, including ambient, refrigerated and controlled drug storage, was undertaken in October 2018. Contract agreements for storage have recently been signed or will be signed imminently. This is expected to cost the Government in the low tens of millions of pounds with the refrigerated storage expected to cost circa £1 million.
The contracts will cover additional capacity including 53,000 pallets of ambient storage, 5,000 pallets of refrigerated storage and 850 pallets of controlled drug storage. We have agreed funding on the condition that the additional medicine warehousing capacity is in place in time to accommodate stockpiled medicines by the beginning of February 2019, lasting for a period of between 12 and 18 months. For security reasons the locations of the additional warehouse capacity will not be published.
The Department’s funding for additional warehouse capacity is on the condition that it is exclusively for the storage of additional stockpiles of prescription only and pharmacy medicines that come into the UK from or via the EU. The Department recognises that through our ‘no deal’ EU exit medicines contingency programme. We are requesting sensitive commercial information from pharmaceutical suppliers. To reassure participating companies, we have committed to treating all information received confidentially, securely and to using it only for the purposes of the Department’s programme. That means not introducing information about specific medicines into the public domain.
As with many contracts involving capital investment, the Department will be liable for some capital costs already incurred by the contractors in the event of a deal being approved by parliament. In that scenario, warehouse providers are required to decommission the additional capacity. The Department has also put in place measures to minimise pre-committed expenditure in the event of a deal being achieved.