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US and UK agree zero-tariffs on pharmaceuticals

The UK will increase NHS medicine spending by 25% and raise cost-effectiveness thresholds as the US agrees to zero tariffs on British pharmaceutical imports.

  • On Monday , the United States and United Kingdom announced a deal exempting UK pharmaceuticals from US import taxes in exchange for increased UK medicine spending, USTR Greer said.
  • After months of escalation, tariff threats and investment withdrawals prompted urgent talks as the Trump administration threatened 100% tariffs and major firms including AstraZeneca, GSK and Merck paused UK projects, while US ambassador Warren Stephens warned earlier this month.
  • The UK agreed to specific pricing changes including raising the NICE threshold to �35,000 and lowering the NHS rebate rate to 15% in 2026, while the NHS will spend 25% more on new treatments.
  • AstraZeneca and GSK's US commitments suggest the deal will redirect major investments, with $50bn and $30bn pledges, protecting UK pharmaceutical exports valued at 17.4%.
  • Months of talks culminated in a package that ties zero US tariffs to UK changes in drug‑pricing policy and secured three‑year 0% tariff protection for UK medicine exports, led by Varun Chandra and Lord Vallance.
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The United States Government has reached a principle in agreement with the United Kingdom on pharmaceutical prices under which Washington will exempt imports of these products of British origin from tariffs, while London is committed to raising the spending of the National Health Service (NHS) on medicines and increasing the net price paid for new treatments by 25%.

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GOV.UK broke the news in United Kingdom on Monday, December 1, 2025.
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