US, UK agree to zero tariffs on medicines; UK commits to higher spending

"The spending increase will stay in place for at least the next three years. The United States has announced a new trade deal with the United Kingdom that includes zero tariffs on pharmaceutical and medical products in exchange for the UK spending more on medicines, the first significant spending increase in more than 20 years, and overhauling how it values drugs."

"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, US Trade Representative Jamieson Greer said in a statement. The USTR statement said the UK would increase the net price it pays for new medicines by 25 percent under the deal. In exchange, UK-made medicines, drug ingredients and medical technology would be exempted from so-called Section 232 sectoral tariffs and any future Section 301 country tariffs."

"Two sources familiar with the deal said it involved a major change in the value appraisal framework at the National Institute for Health and Care Excellence (NICE), a UK government body that determines whether new drugs are cost-effective for the NHS, the sources said. NICE's quality-adjusted life year measures the cost of a treatment for each healthy year it enables for a patient, with the upper threshold being 30,000 pounds ($39,789) per year."

The United States and the United Kingdom reached a trade deal that eliminates tariffs on UK-made medicines, drug ingredients and medical technology in return for higher UK spending on treatments. The state-run National Health Service will spend 25 percent more on treatments for at least the next three years, representing the largest spending increase in over two decades. The deal requires the UK to increase the net price it pays for new medicines by 25 percent. The agreement involves changes to the National Institute for Health and Care Excellence value appraisal framework and references NICE's quality-adjusted life year threshold of 30,000 pounds.

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