The UK and the US finalize zero-tariff arrangement on pharmaceuticals, with the UK increasing spending on new drugs.

The Trump administration has reached an agreement with the UK to allow British medicines to enter the US tariff-free, in exchange for significant reductions in funding reimbursements to the National Health Service by drug manufacturers. The Office of the United States Trade Representative announced on Monday that the US has agreed to "waive tariffs under Section 232 for drugs, drug ingredients, and medical technology originating in the UK." The statement also mentioned that during President Donald Trump's tenure, the US will "avoid pricing actions against British drugs in certain trade investigations." While the US and UK reached a broad tariff framework earlier this year for British goods, key products including medicines have not been resolved. According to the US Trade Representative's Office, the UK will increase its payment for new drugs by 25%. Some of the world's largest pharmaceutical companies have long criticized the UK government's pricing practices and the funding reimbursement mechanisms adopted by the NHS to control costs. Before the announcement, sources revealed that this agreement will reduce the rebate rate from approximately 23% to a maximum of 15% for drug sales.