US-UK deal slashes tariffs on medicines, boosting NHS spending
The agreement removes tariffs on medicines and raises NHS spending on new drugs by 25 per cent, boosting pharmaceutical growth
The United States and Britain announced a deal on Monday to secure zero tariffs on British pharmaceutical products and medical technology in return for Britain spending more on medicines and overhauling how it values drugs.
Under the agreement, Britain will raise the net price it pays for new US medicines by 25 per cent. In return, UK-made medicines, drug ingredients and medical technology will be exempt from Section 232 sectoral tariffs and any future Section 301 country tariffs.
“The United States and the United Kingdom announce this negotiated outcome pricing for innovative pharmaceuticals, which will help drive investment and innovation in both countries,” United States Trade Representative (USTR) Jamieson Greer said in a statement.
The deal includes a significant change to the value appraisal framework at NICE, the UK body that determines whether new drugs are cost effective for the NHS.
NICE’s “quality-adjusted life year” threshold, currently £30,000 (US$40,000) per year, will rise to £35,000.
The British government said the change to NICE would let it “keep pace with the commercial and economic environment in which pharmaceutical companies are operating in today”.