The United States and the United Kingdom have reached an agreement in principle on pharmaceutical pricing as part of the new U.S.–U.K. Economic Prosperity Deal, aimed at addressing long-standing pricing imbalances and strengthening bilateral investment in drug development and manufacturing.
- The agreement increases the net price the U.K.’s National Health Service will pay for new innovative medicines by 25%.
- The U.K. commits to reducing VPAG repayment rates to 15% in 2026 and capping them at or below that level for the duration of the scheme.
- The U.S. will exempt U.K.-origin pharmaceuticals, ingredients, and medical technology from Section 232 tariffs.
- USTR stated the deal is intended to ensure “fair payment internationally for innovative pharmaceuticals.”
- U.S. agencies highlighted expected benefits for domestic drug manufacturing, supply chain resilience, and life-sciences investment.
- The U.S. agreed not to pursue Section 301 actions targeting U.K. pharmaceutical pricing practices during President Trump’s term.
- Officials said the move builds on the administration’s most-favored-nation drug pricing initiatives announced earlier this year.
Relevant Companies
- Pfizer ($PFE) — May see pricing and market-access implications tied to revised NHS payment structures.
- Merck ($MRK) — Potentially affected by tariff exemptions and future U.K. demand for innovative therapies.
- GSK ($GSK) — As a major U.K.-based pharmaceutical company, the firm could benefit from improved pricing terms and increased U.S. investment commitments.
Editor’s Note: This is a developing story. This article may be updated as more details become available.
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