WASHINGTON – Today, the Office of the United States Trade Representative, the Department of Commerce, and the Department of Health and Human Services issued the following statements announcing an agreement in principle on pharmaceutical pricing between the United States and the United Kingdom. In the historic U.S.-U.K. Economic Prosperity Deal (EPD), President Trump and Prime Minister Starmer agreed to address long-standing imbalances in U.S.-U.K. pharmaceutical trade by improving the overall environment for pharmaceutical companies operating in the United Kingdom. The EPD also secured continued investment by U.K. pharmaceutical companies in the United States, further strengthening American leadership in pharmaceutical development and manufacturing.
“President Trump is the first American President to work with U.S. trading partners to ensure fair payment internationally for innovative pharmaceuticals and pharmaceutical ingredients. For too long, American patients have been forced to subsidize prescription drugs and biologics in other developed countries by paying a significant premium for the same products in ours,” said Ambassador Greer. “Today, 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. The Trump Administration is reviewing the pharmaceutical pricing practices of many other U.S. trading partners and hopes that they will follow suit with constructive negotiations.”
“Today’s agreement is a major win for American workers and our innovation economy. We are strengthening supply chains, creating high-quality jobs, and reinforcing America as the world’s premier hub for life-sciences investment,” said Secretary Howard Lutnick. “This deal doesn’t just deepen our economic partnership with the United Kingdom—it ensures that the breakthroughs of tomorrow will be built, tested, and produced on American soil.”
Pursuant to the terms of the pharmaceutical pricing agreement in principle announced today, the United Kingdom will reverse the decade-long trend of declining National Health Service (NHS) expenditures on innovative, life-saving medicines, and increase the net price it pays for new medicines by 25%. Furthermore, the United Kingdom will ensure that higher prices for new medicines are not materially eroded by a demand for portfolio-wide concessions under the Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG) or other rebate schemes. In fact, the United Kingdom has committed that the repayment rate owed by companies under the current VPAG scheme will decrease to 15% in 2026 and remain at or below that level for the duration of the scheme.
“This agreement comes less than two months after President Trump announced the first results of his most-favored-nation (MFN) pharmaceutical drug pricing policy and underscores his determination to bring down drug prices for the American people. When nations fairly share the burden of producing and paying for life-saving medicines, every citizen gains, and the fight against global disease becomes one we can actually win together,” said Chris Klomp, Director of Medicare and Deputy Administrator of the Centers for Medicare & Medicaid Services, and a lead negotiator of the agreement.
In exchange for these and other commitments, the United States has agreed to exempt U.K.-origin pharmaceuticals, pharmaceutical ingredients, and medical technology from Section 232 tariffs and will refrain from targeting U.K. pharmaceutical pricing practices in any future Section 301 investigation for the duration of President Trump’s term. Further, the United States will work to ensure that U.K. citizens have access to the latest pharmaceutical breakthroughs.
“Americans should not pay the world’s highest drug costs for medicines they helped fund,” said Health and Human Services Secretary Robert F. Kennedy, Jr. “This agreement with the United Kingdom strengthens the global environment for innovative medicines and brings long-overdue balance to U.S.–U.K. pharmaceutical trade. President Trump showed real courage and leadership in demanding these reforms, and I thank him for delivering results that put Americans first.”
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