The Office of the United States Trade Representative, the Department of Commerce, and the Department of Health and Human Services have announced that the U.S. Government has reached an agreement in principle on pharmaceutical pricing with the United Kingdom.


In the U.S.-U.K. Economic Prosperity Deal, President Donald Trump and Prime Minister Keir Starmer agreed to address long-standing imbalances in bilateral pharmaceutical trade by improving the overall environment for pharmaceutical companies operating in the United Kingdom.

Under the Deal, U.K. pharmaceutical companies will continue to invest in the United States, further strengthening American leadership in pharmaceutical development and manufacturing.

A per the terms of the pharmaceutical pricing agreement, the United Kingdom will reverse the decade-long trend of declining National Health Service expenditures on innovative, life-saving medicines, and increase the net price it pays for new medicines by 25 percent. Also, the United Kingdom will ensure that higher prices for new medicines are not materially eroded by a demand for portfolio-wide concessions under the Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG) or other rebate schemes. The U.K. Government has committed that the repayment rate owed by companies under the current VPAG scheme will decrease to 15 percent in 2026 and remain at or below that level for the duration of the scheme.


The Office of the U.S. Trade Representative said that in exchange for these commitments, the United States has agreed to exempt U.K.-origin pharmaceuticals, pharmaceutical ingredients, and medical technology from Section 232 tariffs. Washington will refrain from targeting U.K. pharmaceutical pricing practices in any future Section 301 investigation for the duration of the current administration. Also, it has been agreed that the United States will work to ensure that U.K. citizens have access to the latest pharmaceutical breakthroughs.

"Trump is the first American President to work with U.S. trading partners to ensure fair payment internationally for innovative pharmaceuticals and pharmaceutical ingredients," said US Trade Representative Jamieson Greer. "For too long, American patients have been forced to subsidize prescription drugs and biologics in other developed countries by paying a significant premium for the same products in ours". Ambassador Greer said the Trump Administration is reviewing the pharmaceutical pricing practices of many other U.S. trading partners and hopes that they will follow suit with constructive negotiations.