US, UK to agree zero tariffs on pharmaceuticals: report

The UK and US are set to reach an agreement on zero tariffs on pharmaceutical products, with an announcement to be made at the White House, according to two sources familiar with the matter.

The deal is expected to include an increase in the percentage of Britain’s state-run National Health Service (NHS) budget spent on medicines, sources said.

It will also involve a major change to the value assessment framework of NICE, a UK government body that determines whether new medicines are cost-effective for the NHS, sources said.

NICE’s “quality-adjusted life year” measures the cost of treatment for each healthy year possible for a patient, with the upper threshold being 30,000 pounds ($60,600) a year.

Sources who spoke on condition of anonymity to discuss confidential talks between governments said that this threshold is planned to be increased by 25 percent.

The White House and the UK government did not immediately respond to requests for comment.

British Science Minister Patrick Vallance has previously stated that trade talks with the US will likely lead to increased government spending on some medicines.

He told MPs in October that “some degree of price rise is inevitable” for new, innovative drugs under negotiations, but existing drugs and generics may not see the same increases.

US President Donald Trump has pressed Britain and the rest of Europe to pay more for US drugs as part of his push to bring US drug costs more in line with those paid in other rich countries.

Meanwhile, major pharmaceutical companies, including AstraZeneca, the largest company by market value on the London Stock Exchange, postponed their investments in the United Kingdom, citing the difficult operating environment.

The two countries agreed in May to seek “significantly preferential treatment outcomes in medicines”, with the UK pledging to work to improve the environment for pharmaceutical companies operating in the country.