The UK has bowed to pressure from Donald Trump and agreed to raise the amount the NHS pays for medicines, the first increase in more than twenty years, in exchange for a three-year guarantee that American tariffs on British pharmaceuticals will stay at zero.
Under the deal announced on Monday, the US will keep duties at 0% on UK-made drugs, protecting exports worth £11.1bn a year and roughly 45,000 British jobs.
In return, the NHS will lift its cost-effectiveness threshold for new treatments by 25%, cap rebates from drug companies at 15% instead of last year’s 20%-plus, and double overall medicines spending as a share of GDP over the next decade.
The agreement ends months of anxiety after Trump repeatedly threatened levies of up to 100% on imported branded medicines, accusing foreign countries of “freeloading” on high US prices. Pharmaceuticals had been spared in earlier tariff waves, but the president-elect made them a personal target in his drive to bring manufacturing home.
Business Secretary Peter Kyle called the outcome “a vital safeguard for one of Britain’s most successful export sectors”, insisting the changes would also speed patient access to cutting-edge therapies. Industry bodies welcomed the certainty, warning that tariffs would have triggered factory closures and stalled investment.
Critics, however, accused the government of surrendering to a protectionist shakedown. “This is the NHS paying ransom so that drug firms can keep selling to America,” said Liberal Democrat health spokeswoman Helen Morgan. Campaigners warned that higher spending will either mean bigger budgets or diverted funds from other services at a time of record waiting lists.
White House spokesman Kush Desai hailed the pact as proof that “developed nations are finally paying their fair share”.
