British-based veterinary medicine producer Dechra has moved all its analytical testing methods for products made at its site in Skipton to laboratories in Croatia and the Netherlands as it seeks to protect its business from a potential hard Brexit. 

Dechra said on issuing its audited preliminary results for the year ended June 30 2019 on September 2 that it now seems likely there will be no mutual recognition of quality standards after the UK leaves the EU. Britain crashing out of the EU without a deal on October 31 is now seen as the most likely outcome, and businesses are preparing accordingly. 

“In preparation for a potential hard Brexit, we have changed the ownership of all UK marketing authorisations to a newly established subsidiary in the Netherlands. We have also transferred all the analytical testing methods for products manufactured at our Skipton site to a new laboratory in Zagreb, Croatia, and to our existing laboratory at our Bladel manufacturing site; this will allow us to perform batch release within the EU in the likely event that there will be no mutual recognition of quality standards,” the company said. 

Among its other preparations for a hard Brexit, Dechra has increased inventory in the supply chain to mitigate potential delays at ports, and raised its working capital partly due to a planned increase in inventory to support the potential disruption arising as a result of Brexit, as well as the expected growth of the group, it said. 

Brexit was detailed among three emerging risks to the company’s outlook, along with taxation and the impact of US sanctions on its business in Iran. 

“The decision by the UK to leave the European Union (EU) has created volatility in markets and uncertainty about how future trading relationships, regulatory processes and supply chains will operate. Our priority is to maintain continuity of supply of our products to our customers in the UK and the EU, and we have increased inventory accordingly,” the company said. 

Dechra started out two centuries ago in London as Arnolds & Son. The company originally manufactured prosthetic limbs, but turned to veterinary medicine during the Crimean War. It has had a connection to Skipton in Yorkshire since 1948, when Dales, a licensed manufacturer of human and veterinary pharmaceuticals for Arnolds and other third party customers, was set up. 

Both Arnolds and Dales were purchased by Lloyds Chemist PLC in 1992, but five years later separated from Lloyds in a management buyout to form Dechra Pharmaceuticals. Four years ago, Dechra acquired Croatia’s oldest and largest producer of animal health products, Genera. 

According to its website, Dechra’s product range is focused on several major therapeutic categories, predominantly for companion animals, though it also produces veterinary products for food producing animals.