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What lessons for April 2021 did we learn from IR35 preparations in 2020?

The changes to IR35 are due be introduced in April 2021 and are set to have a large impact on the UK contracting market. The changes were initially scheduled to take place in March 2020 but due to the global pandemic they were put on hold. The delay has provided contractors and companies extra time to ensure they were prepared for the change in how a contractor’s IR35 status will be determined. Companies were already preparing for the initial April 2020 deadline and through working with numerous life sciences companies, we have been able to see a range of approaches. As 2021 quickly approaches and companies need to revisit their IR35 preparations, we want to share some of the key lessons we learnt from 2020. What are the changes? The legislation itself is not changing, however, the parties responsible for assessing a contractor’s status and deducting/reporting the tax has been revised. Under the current legislation: Where a contractor is operating via their own personal Service Company, they are responsible for making the Status Determination and confirming if they are in or outside of scope of the current IR35 rules. The liability sits with the contractor. Under the revised legislation: The client will be responsible for assessing and providing the Status Determination on whether the contractor falls within scope of IR35. The liability would shift to the client who will be responsible for communicating this decision down the supply chain until it reaches the “Fee Payer” i.e. the entity paying the PSC, which is usually the agency. Once a status determination has been received by the Fee Payer, they are responsible for applying this decision. Where the assignment is out of scope, the Fee Payer will pay the PSC gross and the contractor will be responsible for paying the correct tax to HMRC. There the assignment is in scope the Fee Payer will be responsible for:  Deducting PAYE and NICs and paying the PSC the NET valuePaying the Employers NICsReporting the deductions made via Real-Time Information                                                                                            Lessons learntHaving worked with a broad range of biotechnology, pharmaceutical and medical devices companies and CROs throughout the preparations for IR35 in late 2019/early 2020, we had a unique insight into the various methods, successes and pitfalls in the planning. These are some of the core lessons learnt from 2020: A Team Approach Many companies had delegated one core lead for their IR35 preparations, but the ones that saw a more successful preparation process where those that had multiple internal stakeholders involved. “It’s definitely not too late to start making changes and to start implementing what has to be done and one of those key things is undoubtedly ensuring that you have a robust IR35 project team internally, where everyone within that project team understands what their responsibilities are. In terms of the project team, we found out very quickly that it’s too much for one individual to take on themselves…”Elliot Tiffin - Vice President of Global Contract Services at Hobson Prior Communication was a core influencer in determining successful preparation. Knowing how many contractors will be impacted, contacting each section of the supply chain and ensuring all parties were aware of their responsibilities and decisions being made should not be underestimated. It was the companies that were willing to invest time and resources to these processes and engage their contractors, consultants and their peers in the market. “From the approaches that were good from our clients and the industry, in particular, were those that were open and transparent and shared not only their concerns with us, but with each other, whether it be forums or conferences – those that were open to their concerns and then their solutions definitely fared better than those that didn’t.”Elliot Tiffin - Vice President of Global Contract Services at Hobson Prior                                                                                             Communication channels crossed With many variable unknown and several businesses at different stages of their preparations, there was a lot of rumour regarding how contractors may be impacted in comparison to their peers within the life sciences contracting market. As is the nature of contracting, there is a level of separation with the end client they are providing services for and contractors, which led to contractors questioning their recruitment agencies, different stakeholders within the business as well as their peers to try and find answers. Without a clear line of communication, this caused problems, as described by Interim Biometrics Team Lead, Mike Masoomi: “Lots of contractors are used to liaising directly with their consultant or their agency that they go through. Others have a more direct line of communication with their line manager or in some cases other stakeholders in the company that they’re contracting with."And what I experienced last year is that a lot of contractors are having half of their conversations internally with the client that there providing services to and the other half with us and that causes a lot of issues and what we need to make sure in 2021 one is that the agency the end client and the contractor all set a clear channel of communication so we can all reach the same objective and that is that all parties are happy and well informed.”Michael Masoomi - Team Lead for Interim Biometrics Recruitment at Hobson Prior This lack of consistent communication ultimately led to frustrated contractors, who were unclear if they were now in or out of scope, how this would impact their income and livelihoods, as well as how and when they would receive this information. This was particularly frustrating as more companies revealed their plans and contractors engaged within the market were receiving mixed messages from their industry peers.                                                                                            Blanket statements cost more than they saved The biggest area of contention we saw in the IR35 preparations in 2020, was how companies dealt with determining the status of their contractors. In order to save time, some companies decided to use a blanket approach of defining all their contractors as in scope, however, as we witnessed first-hand, this often caused more problems than it resolved. “With the disputes process, one thing that we did see and that we’ve learnt from the process last year, was that the organisations that made blanket determinations actually received more disputes than any other that we saw so retrospectively the idea of maybe saving time, worked as a hindrance and actually cost them time net in the process when you look at it as an overall.”Elliot Tiffin - Vice President of Global Contract Services at Hobson Prior We saw more disputes regarding status determination from contractors working with companies that had used this blanket approach. Whilst this was a helpful test for the 45-day review process, the time and resources required to deal with the influx of unexpected appeals from contractors challenged the initial reasoning behind taking a blanket statement approach. As well as an increase in disputes, there were other impacts to this method of determining all contractors as in scope of IR35.                                                                                             Reputational impact Another unexpected backlash from companies that took a blanket approach for determining contractor status under IR35 was the impact this had on their reputation across the UK life sciences contracting market. “The organisations that made blanket determination […] actually started to deter candidates from applying to contract projects there as they wanted to ensure that if they did have the possibility of operating outside of the legislation, then they at course could.” Many contractors we worked with were concerned that the determination process was being transferred from their control, so it is unsurprising that there was frustration when they were not being included in the determination process. “What I found most interesting was that it wasn’t just contractors that disagreed with the determination, it was actually contractors that didn’t feel listened too or valued and that was the biggest reason for them looking elsewhere.”Michael Masoomi - Team Lead for Interim Biometrics Recruitment at Hobson Prior There are numerous factors that can impact a status determination position and with contractors’ payment on the line, unclear communication and neglect complicated many previously amicable working relationships.                                                                                             Opportunity to impress Conversely to the above, Hobson Prior found that the companies that engaged their contractors throughout the process and ensured clear and timely information raised their profile within the industry. “Those organisations and those that we partnered with that were really open and transparent to help and that consulted with their contractors on a one-on-one basis actually became hubs for talent. People that were in the industry recognised those organisations as ones that did treat IR35 with the seriousness that it deserves and then they wanted to work for these companies.”Elliot Tiffin - Vice President of Global Contract Services at Hobson Prior With a lot of uncertainty and rumours across the life sciences market, organisations that could provide an organised process and engaged contractors were more appealing and many contractors we worked with were actively seeking opportunities at companies which has a robust IR35 plan in place.                                                                                            Adapting for 2021 The core lessons we’ve seen from the 2020 deadline preparations revolve around one core aspect of the changes to IR35: making status determinations. From this, the advice we’ve been emphasising with our life sciences clients with contractors in the UK is: Ensure your IR35 team has the resources and support neededEstablish transparent communication channels for contractorsEngage contractors throughout the process, adopting a case-by-case approach if possibleEmphasise your understanding and awareness of the impacts to contractors and demonstrate this support with clear guidance and timely updates Of course, collecting all contractors and exploring each of their status factors on a case-by-case status is not to be underestimated, which is why Hobson Prior has developed a Status Determination Tool. This tool allows organisations to determine status and utilise IR35 experts to ensure all factors are considered when determining whether a contractor falls in or out of scope of IR35. Backed by a specialist, award-winning team, the tool provides more than an algorithm and allows our clients to provide contractors with timely and accurate determinations, which in turn promotes better communication and more support in their preparations for April 2021                                                                                        See how Hobson Prior’s IR35 status determination tool can help life sciences companies best prepare for changes to IR35 by contact our team at IR35@hobsonprior.com

Hobson Prior continues global expansion within life sciences recruitment support

Hobson Prior continues global expansion within life sciences recruitment support Life science recruitment company Hobson Prior has further expanded its global presence this month by opening a new office in Cape Town. This is the second international office the UK-based firm has opened in 2020, after establishing itself in Basel, Switzerland earlier this year. As life sciences recruitment partners for pharmaceutical, biotechnology and medical devices companies around the world, scalability and global coverage have always been key to Hobson Prior’s success. With clients from around the world and a headhunting and candidate network spanning several continents, Hobson Prior continues to grow its international presence throughout 2020. International presence Hobson Prior prides itself on delivering expert recruitment solutions to candidates and clients around the world, covering the core life sciences hubs and beyond. It is through these international connections that they have access to the highest calibre of candidates and can headhunt rare and nicely specialised talent. Notably, Hobson Prior has placed life sciences workers in over 30 countries in interim and permanent positions. Also, Hobson Prior’s interim recruitment team hit a landmark 200 live onsite contractors across Europe amidst the global pandemic. “The currently global situation has proven the possibility of embracing more remote working, particularly on an international scale,” comments Patrick Forster, Managing Director of Hobson Prior. “As our network and internal coverage expands, we can continue to connect life sciences professionals with the companies that need their services and offer innovative and efficient recruitment solutions for our clients”. Global expansion This year, Hobson Prior relocated their Switzerland office from Lausanne to Basel. They also secured a SECO interim recruitment license, enabling them to payroll Swiss contractors and provide compliant interim recruitment services to Swiss clients directly from their Basel office. This has enabled them to improve their solutions for clients, as well as support international businesses source talent to launch new sites within Switzerland. Most recently, they’ve helped US based clients overcome the challenges of hiring in Switzerland from the states, using the recruiters based in Basel to impart their knowledge and experience of the Swiss candidate market. Introducing Hobson Prior Cape Town Following the Swiss move, Hobson Prior is also opening a new office in Cape Town, South Africa, expanding their team to establish themselves within a new continent and ensure they can continue to provide expert international support to their life sciences clients, wherever they may be.South Africa is home to sites for many biotechnology and pharmaceutical companies, including GlaxoSmitheKline, Pfizer and Sanofi and is a growing hub for development within the life science. This new office aims to support Hobson Priore's global efforts and ensure they can support their clients with recruitment solutions, regardless of time differences.   “These steps are key to Hobson Prior’s plans for sustainable global growth and will empower us to continue our mission to provide exceptional recruitment solutions to candidates and clients across the life sciences sector, on a truly worldwide scale”Patrick Forster- Managing Director, Hobson PriorFor more information on Hobson Prior’s international recruitment solutions, please visit the employers section of the website or contact the client services team directly:Email: clientservices@hobsonprior.com Telephone: (+44) 01892 612612

Why are there so many pharmaceutical companies in Switzerland?

Switzerland is one of the most popular places for a pharmaceutical company to establish a new site. Global industry leading companies including Roche, Novartis, Merck and Celgene have a large presence within Switzerland and there is continued interest from international biotech and pharma companies, particularly from the US, to open new sites within the country. Over 40 new biotechs and pharma companies established themselves in there in 2019, so why are so many pharmaceutical companies in Switzerland? Why are European pharma companies concentrated in Switzerland? Switzerland’s relationship within Europe Over a third of Swiss exports come from the pharmaceutical and life sciences industry and the territory has established itself as a leading hub for life sciences development within Europe. With over 250 pharmaceutical and biotechnology companies based across Basel, Zurich, Geneva and other core cities in Switzerland, there is already a proven and well-resourced access to talent, resources, funding and clinical development within the country. Similarly, being geographically close to other leading life sciences hubs within Germany, France and Italy provides Switzerland a very beneficial position to expand a life sciences business. Switzerland and the EU and EMA Switzerland is not a member of the EU or the EEA (European Economic Area), but maintains a confidentiality agreement with the European Commission and European Medicines Agency (EMA) through the Swiss Agency for Therapeutic Products (Swissmedic). Similarly, the sovereign state maintains a strong connection to the European Union with a mutual recognition agreement (MRA) for good manufacturing practice (GMP) compliance, as well as strong ties to the FDA. This unique political and commercial position can be advantageous for pharmaceutical companies to have a presence in this booming market that has more financial and political freedom, whilst ensuring strong connections to the EMA and FDA global markets.   Top life sciences talent from Switzerland A core consideration for any site selection is ease of accessibility to top talent within the industry; ultimately, it is a strong workforce that drives success in pharma. Attraction and retention of talented professionals relies on the appeal of the country and its cities, the quality of life and understanding of local customs and employment laws. Whilst it is difficult to quantify analysis for employee potential and happiness in their environment, Switzerland ranks highly across numerous studies in workforce satisfaction and quality of life. Switzerland and access to talent Switzerland has consistently ranked highly in the Global Talent Competitiveness Index (GTCI), which measures and ranks countries based on their ability to grow, attract and retain talent. Switzerland was ranked first place in the GTCI 2020, with notably high rankings in employee retention, enabling employees’ development and encouraging personal growth. With a particular focus on how AI and adoption of technology have impacted the index in 2020, Switzerland’s high ranking demonstrates a promising consideration of innovation alongside talent attraction and business development Similarly, the country ranks highly for many aspects of workforce skills in the World Economic Forum Global Competitiveness report 2019, with 1st place rankings in extent of staff training, quality of vocational training and skillsets of graduates. Switzerland is also home to 4 out of 100 of the Times Higher Education top 100 universities worldwide, with 7 in the top 200 universities, promoting Switzerland’s reputation for education and research. Strong performance in these areas highlights the promising growth Switzerland has in attracting top talent internationally, as well as producing skilled workers within its education system and employee development.   Switzerland and quality of life for employees Switzerland scores highly in employee retention on the GTCI 2020, suggesting a satisfactory lifestyle provided for potential employees. This is further supported by Zurich’s position as 2nd, Geneva as 9th and Basel as 10th globally on the Mercer Quality of Living Index 2020, which reviews quality of living standards in line with typical compensation packages.    The combination of all these factors, alongside the proximity to other leading life sciences hubs in Germany and France, suggest Switzerland can be a highly beneficial place for skilled professionals to establish their career across biotechnology and pharma, enabling Swiss based pharmaceutical companies access to talented individuals, at a local level, across a range of specialist fields.   “Practically all the specialist life sciences candidates we work with are aware of Switzerland’s appeal within the industry. There is no shortage of talented professionals already based or looking to locate to the vicinity so there is often a surplus of viable candidates.” Matthew Vickers, Principal Consultant for Swiss Clinical recruitment at Hobson Prior. “In fact, it is often more difficult for the companies we work with to compete for the attention of this talent, particularly if they don’t know the swiss recruitment system.”   Switzerland’s investment in R&D With biotechnology and pharma making up 40% of Swiss exports, Switzerland has the largest export surplus of pharmaceutical products worldwide, producing 88.4 CHF billion in pharmaceutical industry exports in 2019. It is no surprise that Switzerland invests heavily in its research and development schemes to ensure continued growth and innovation. Around 7,000,000,000 CHF was invested into R&D from Swiss pharma companies in 2018, with continued investment and innovation across the pharma and biotech spaces within Switzerland. This led to the development of multiple new start-ups as Switzerland continues to continue to build its life sciences industry. As a core industry, the country is very supportive of its innovators.   Switzerland and innovation Switzerland ranked number 1 against EU countries on the in European Innovation Scoreboard 2020, which assesses the relative strengths and weaknesses of national innovation systems within the EU and neighbouring countries. With Switzerland globally renowned for life sciences innovation, the pharma industry is likely to have contributed significantly to this.   For life sciences, Switzerland’s commitment to funding innovative ideas provides a great advantage for pharma development. The registration process for obtaining a license for a new pharmaceutical product from the Swiss Agency for Therapeutic Products is one of the fastest in the world and with one of the most sophisticated healthcare systems, it lends itself to efficient pharmaceutical development and clinical testing. With leading biotechs specialising in new technological advancements such as cell and gene therapy, CRISPR and AI integration across the life sciences, the country’s influence in life sciences is visible on a global scale. With a landscape centred on innovation and scientific development, many pharma companies enjoy the benefits of being based there.   Switzerland and future stability Through investment in innovation, Switzerland ranks highly across core areas of future development and readiness for changes and advancements within the life sciences industry and across the global business outlook: 1st for change readiness - 20191st for growth promise indicators - 2019 1st for economic freedom in Europe - 20202nd for global resilience - 20203rd for world competitiveness - 2020 Whilst the future is never fully certain, with strong investment and dedication to promoting its life sciences, Switzerland appears to be at the height of pharmaceutical development and with no plans to slow down.     Switzerland as an international investment Overall, there are various reasons impacting a pharmaceutical company’s decision for a site location and Switzerland has established itself as a proven global leader in many of these aspects, including talent attraction, investment into innovation and pharmaceutical success. With a large focus on the life sciences and pharma as a core export, it is unsurprising to see so many talented professionals - educated within Switzerland or living locally - and numerous start-up labs and biotech research teams establishing themselves across the country. It is also unsurprising that many growing companies in the pharmaceutical industry who are looking to expand internationally, choose Switzerland as the location for their sites including Hobson Prior, who have a team based in Basel. It is worth noting that, as with any international expansion, the customs, expectations and processes for recruitment within Switzerland can vary significantly.“We see particularly with US pharma companies looking to build teams in Switzerland, they can come across difficulties with time differences and slight differences in processes that makes it difficult to secure top talent in a competitive market.“With so much competition for strong candidates, we help them promote their career opportunities and navigate the local nuances of the typical Swiss recruitment process”.James Inwood – Client Services Manager at Hobson Prior For more information on hiring life sciences professionals in Switzerland as part of an international expansion, you can contact our Swiss recruitment team, or read our case study following how a US company launches its Swiss office despite the time differences and different hiring culture.

Brexit and its effect on Pharmacovigilance in the EU - a recruiter's perspective

Our own Matthew Jenner, Pharmacovigilance Staffing Specialist, shares his insights on how Brexit will impact the EU and UK pharmacovigilance job market. The term ‘Brexit’ has been used so much in the past two years, it’s almost become a cliché. With Brexit deals and no deals dominating the news and few definitive decisions, it would be fair to say that, it’s not a term that brings about much positivity, particularly for the UK and EU job market. That said, as a recruiter focusing specifically within the area of Pharmacovigilance (PV), I have quite a different view on the whole matter. Not only because I can see the abundance of PV career opportunities that will result from it in mainland Europe, but also the fact that it will change the shape of what we know as ‘Drug Safety’ in the UK if the UK leaves both the EU and EEA (European Economic Area) So, what effect will Brexit have on PV jobs for both the UK and the EU? With the lack of decisive action coming from those orchestrating the follow-up of Article 50, it’s difficult to predict the future of the pharmaceutical industry post-Brexit. Although the UK will be leaving the European Union, it’s relationship with the EEA is still not confirmed and there are various issues that are still to be negotiated, including how the UK and EU pharmacovigilance will operate. In terms of PV, currently, the only change that has been announced from the EMA is that the EU Qualified Person Responsible for Pharmacovigilance (QPPV) will be required to be based in the Union (EEA). Despite some murmurs of optimism, it is unlikely that UK-based EU-QPPVs will be able to continue to operate in the UK following Brexit. It was confirmed by the EMA this June via a Q&A report that EU-QPPVs and the Pharmacovigilance System Master File (PSMF) will legally have to reside in the Union (EEA). This means that, regardless of whether the UK continues to operate under the EMA’s regulations or not, to remain compliant with EU drug safety, the EU-QPPV and PSMF will not be able to operate in the UK if the UK leaves. This is not the only potential upset in PV due to Brexit as it is being widely debated whether Deputy QPPVs will also need to be based in the Union (EEA), as well as whether the deputies will operate as Local Person for Pharmacovigilance (LPPV) or a Local Responsible Person. This will certainly cause disruptions and both pharmaceutical companies and qualified workers are stuck in limbo while these decisions are slowly being finalised. With approximately 1,300 EU-QPPVs based in the UK who, under this current legislation, will have to be relocated to or replaced in the Union (EEA) by law, there is understandably a great deal of concern regarding these decisions. As senior lead for the Association of the British Pharmaceutical Industry’s (ABPI), Virginia Acha commented back in 2017: “Moving house is the fourth most stressful thing in your life! How are we going to make sure that we don’t have a major slowdown in procedures?” Whether this means the entirety of Drug Safety jobs are moved with the QPPVs and PSMFs to the Unions (EEA) remains to be seen. These grey areas have caused a great deal of unease amongst pharmaceutical companies and workers alike, especially with high costs and job security at risk. So, what does this mean for EU and UK PV job opportunities? From my perspective, it would be illogical to move all PV out of the UK: there has been a great deal of investment in the PV market in the UK, as well as a large talent pool of PV professionals. Moving entire PV departments to the Unions (EEA) purely because the QPPV and PSMF is operating there, is extremely unlikely with the costs and sacrifices involved. Moreover, though there is a huge amount of talent in Europe for PV professionals, this is a niche area and there is not currently enough to backfill the deficit that would be left from the UK-based PV talent pool. Various questions remain for UK based workers that wouldn’t want to relocate. If you are concerned about UK PV jobs and how Brexit will impact them, get in touch with the career experts and we can discuss the market and opportunities with you. One question I’ve been asked a lot is if there will be opportunities in the EU that weren’t there before due to Brexit? In short – Absolutely. As recruiters, we are already seeing more demand from leading pharmaceutical companies for European based PV professionals – from Case Processors to Safety Physicians, from Drug Safety Scientists to PVQA Managers; there’s an abundance of new opportunities being created (which you can take a look at here). UK PV professionals will have new exciting offers to work abroad as more permanent and contractor opportunities open. We’re seeing global pharma companies with strategies to move large sections of their PV group to offices in Europe due to Brexit. We’re also seeing global pharmaceuticals who are looking to move their QPPV out of the UK, but keeping their wider PV team based in the UK. The key takeaway is that despite the uncertainty regarding the role of QPPVs, the demand for pharmacovigilance jobs and talent is still high and there are opportunities for all qualified QPPVs, regardless of their location. What is certain is that, until told otherwise, it is business as usual for both UK PV and EU PV workers. The pharmacovigilance industry is anticipating a shake up, but as many of you who have worked in this vital area of the industry, this is nothing new and it will settle…eventually. At least, that’s what I think based on the what I’ve seen working closely with top talent and pharmaceuticals across the UK and Europe. What are your expectations on how Brexit will impact drug safety and pharmacovigilance? What’s been your experience with the PV job market since Brexit was announced? For more information on the pharmacovigilance job market and to see the latest PV job opportunities across the UK and EU, check out the latest jobs, exclusive to Hobson Prior here. This blog includes views and opinions of the author and do not necessarily reflect the official policy or position of Hobson Prior.

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