Britain has finalised a pharmaceutical trade deal with the United States, granting tariff-free access for UK-made medicines in return for higher prices for new drugs.
The arrangement, part of a broader US-UK trade accord signed last year, guarantees Washington will maintain zero tariffs on British pharmaceuticals for at least three years, making the UK the only country with such preferential access.
British Business and Trade Secretary Peter Kyle said the deal would support the UK’s pharmaceutical sector, protect high-skilled jobs, and reinforce the strength of U.S.-UK economic ties. Pharmaceuticals account for roughly one-fifth of British goods exports to the US.
Under the agreement, Britain will raise the net price paid by the NHS for new medicines by 25% from April 2026. Spending on medicines is set to increase from 0.3% of GDP to 0.35% by 2028, and 0.6% by 2035. The deal also requires changes to NICE’s appraisal framework, including higher cost-effectiveness thresholds for new drugs. Tariff exemptions are conditional on UK pharmaceutical companies complying with separate US pricing and tariff agreements.
The pact shields medical technology exports from tariffs and includes safeguards under a proposed US “most favoured nation” pricing policy. It also strengthens regulatory cooperation between the Medicines and Healthcare products Regulatory Agency and the US FDA, including aligning medical device standards to accelerate patient access.
Companies such as AstraZeneca and GSK, which already secured three-year tariff protections, welcomed the deal, highlighting the certainty it brings to US market access while rewarding innovation.
