LONDON (AP) — The United Kingdom has secured a significant trade deal with the United States, resulting in a 0% tariff rate for all U.K. medicines exported to the U.S. for a period of at least three years. This agreement, announced on Monday, is contingent upon the U.K. increasing its investment in new medicines. Officials highlighted that this deal represents the lowest tariff rate offered to any country in relation to pharmaceuticals.
As part of the agreement, the U.S. has committed to exempt U.K.-origin pharmaceuticals, pharmaceutical ingredients, and medical technology from import taxes. This exemption is expected to foster a more favorable trading environment for U.K. pharmaceutical companies, which will help to enhance the availability of innovative treatments for patients. In exchange, U.K. drug firms have promised to make greater investments in the U.S. healthcare sector and to generate additional job opportunities.
The U.K. government has revealed that the National Health Service (NHS) will increase its spending on new and effective treatments by approximately 25%, marking the first significant rise in such expenditures in over two decades. This increase in funding will enable U.K. health authorities to approve medicines that provide substantial health benefits, which may have been previously declined based on cost-effectiveness assessments. Such approvals could include groundbreaking cancer treatments and therapies for rare diseases.
Science and Technology Secretary Liz Kendall emphasized the importance of this deal, stating that it ensures U.K. patients will have quicker access to cutting-edge medicines and that it supports the continued development of transformative treatments by U.K. firms. The Association of the British Pharmaceutical Industry (ABPI) echoed this sentiment, calling the agreement a crucial step in ensuring that patients have access to innovative medicines, ultimately leading to improved health outcomes within the NHS.
Furthermore, Richard Torbett, the ABPI chief executive, asserted that this deal will strengthen the U.K.’s position in attracting global life science investments and furthering advanced medicinal research. U.S. Health Secretary Robert F. Kennedy Jr. also praised the agreement, stating that it enhances the international environment for innovative medicines and establishes a much-needed balance in U.S.–U.K. pharmaceutical trade.
Recently, several pharmaceutical companies, including AstraZeneca, have suspended or canceled investment plans in the U.K. due to concerns over trade and investment conditions. U.S. ambassador Warren Stephens issued a warning that American businesses might reduce future investments in the U.K. unless prompt changes are made.
Earlier in the year, President Donald Trump and British Prime Minister Keir Starmer laid the groundwork for a broader trade pact that would reduce U.S. import taxes on British goods such as cars, steel, and aluminum, in exchange for greater access for U.S. products like beef and ethanol into the British market.
