The U.S. and the United Kingdom reached an agreement in principle to address pharmaceutical pricing disparities and secure investment under the U.S.-U.K. Economic Prosperity Deal.
According to a Dec. 1 news release from the U.S. trade representative’s office, the U.K. committed to increasing the net price it pays for new medicines by 25%. The U.K. will also ease the financial rules it places on drug companies by capping how much they have to pay back to the government on the sales of their branded medicines. Starting in 2026, these repayments will drop to 15% and will not go above that level for the rest of the current pricing program.
In exchange, the U.S. will exempt pharmaceuticals, ingredients and medical technologies that originate in the U.K. from Section 232 tariffs and refrain from initiating Section 301 investigations into U.K. pharmaceutical pricing practices for the remainder of President Donald Trump’s term.
This is the first agreement under the administration’s trade policy to include specific price targets for a foreign healthcare system. U.S. officials said in the release that the U.K.’s commitment to pay more for innovative medicines will help reduce pressure on domestic payers and support investment in pharmaceutical development and access.
The U.S. is reviewing pricing practices of other trading partners and plans to pursue similar negotiations. The U.K. agreement builds on the administration’s broader push to equalize global drug pricing. In recent months, the White House has signed most-favored-nation pricing deals with Pfizer, AstraZeneca, Eli Lilly and Novo Nordisk — requiring companies to match their lowest international prices and offer steep discounts through TrumpRx, which is set to launch in 2026.
