• The US and UK have agreed to a trade deal eliminating tariffs on pharmaceuticals.
• The deal requires the UK to increase NHS spending on medicines by 25% over three years.
• Changes to the NICE drug valuation framework will allow for a higher cost threshold for new treatments.
• The agreement aims to spur investment and innovation in both countries' pharmaceutical sectors.
• The deal addresses longstanding concerns about drug pricing disparities between the US and other countries.

On December 1, the United States and the United Kingdom announced a significant trade deal that establishes zero tariffs on pharmaceutical products and medical technology. This agreement mandates an increase in spending on medicines by the UK's National Health Service (NHS) by 25% over the next three years, aimed at fostering a more favorable environment for pharmaceutical investments, according to Reuters and BBC.

The trade deal was detailed by US Trade Representative Jamieson Greer, who noted it aims to "drive investment and innovation" in both nations. This includes increasing the budget allocation for new medicines within the NHS, responding to pressures for more equitable pricing between the US and other developed countries, reports Channel News Asia and South China Morning Post.

The UK's National Institute for Health and Care Excellence (NICE) will also undergo major changes, most notably an adjustment of the cost threshold for determining whether new treatments are cost-effective, increasing from £30,000 to £35,000 per quality-adjusted life year by 2026. This is expected to allow 3 to 5 additional treatments to be approved annually, according to Al Jazeera and Le Monde.

Concerns had grown within the pharmaceutical sector regarding high tariffs that could potentially hinder investment in the UK, prompting some companies like AstraZeneca to scale back operations. With this agreement in place, investment intentions are expected to shift positively, as industry stakeholders view the deal as a means to maintain a competitive edge and attract future investments, as affirmed by The Hill and BBC.