THE UK-US trade deal will mean the NHS has to divert billions from other NHS services to pay more for new medicines.
Around £45bn in NHS funding will be diverted from other NHS care by 2036 to pay more for new medicines under the UK-US trade deal agreed last December, unless more funding is made available to cover the additional costs, states an analysis published by the British Medical Journal.
Reduced NHS spending on other health interventions will have an adverse impact on public health which could increase preventable deaths by 229,000 by 2036 – more than the Covid-19 pandemic between March 2020 and June 2022 (137,000).
If the indirect effect on adult social care is also included, excess deaths could increase to 291,000. Most of these deaths are expected to be people with cardiovascular, respiratory, and gastrointestinal disease and cancer.
The UK-US pharmaceuticals deal was announced by the UK government on 1st December 2025 and was described as a ‘landmark’ deal that would ‘safeguard medicines access and drive vital investment for UK patients and businesses’ through strengthening UK-US cooperation in sectors like life sciences and pharmaceuticals.
The agreement secured a 0% tariff on UK pharmaceutical and medical device exports to the US for three years, but also committed the NHS to substantially higher expenditure on new branded medicines over the next decade through changes to drug pricing arrangements and health technology assessment.
From April 2026, the government instructed the National Institute for Health and Care Excellence (NICE) to increase its cost-effectiveness threshold for new medicines from £20,000-£30,000 per quality adjusted life year (QALY) to £25,000-£35,000 per QALY for the same health benefits.
Changes in the way health benefits are measured by NICE’s assessments will also give more weight to benefits offered by new medicines.
An agreement between the pharmaceutical industry and the UK government (the voluntary scheme for branded medicines pricing, access, and growth; VPAG) designed to limit growth in NHS expenditure on branded medicines through industry rebate payments has also been watered down. In 2025, the rebate rate was 23% but under the new agreement this has been cut to 14.5%.
Overall, under the deal, the government has committed to more than double spending on new medicines from 0.3% of gross domestic product (GDP) to at least 0.6% by 2036.
Even if these GDP targets are met and GDP rises by 1.5% annually, as predicted by the Office for Budgetary Responsibility (OBR), the additional annual costs to the English NHS will be at least £1.3bn in 2028 (£25m per week), and £8.8bn in 2036 (£170m per week). The cumulative additional cost will be £2.6bn by the end of 2028 and £44.7bn by the end of 2036.
NICE estimates that increasing cost effectiveness thresholds will result in only two to five additional medicines being approved annually.
NICE already approves more than 90% of medicines it evaluates, suggesting that the agreement will increase the prices paid for medicines already entering the NHS.
The projected costs of the agreement are expected to exceed the total annual value of UK medical exports to the United States (£5bn) before 2031.
Clearly as the economic crisis hits the British economy even harder, workers are being made to pay the price.
‘Healthcare free at the point of need’ will become pay more for subscriptions, pricing many patients out of the use of vital medicines.
There is no solution under this bankrupt system that will defend free healthcare for all under the NHS.
It needs action by the trade unions to call a general strike to bring down this government, end this rotten trade deal with the United States, and establish a workers government with a socialist economy. This is the only way to safeguard the NHS and ensure that all can receive free healthcare that need it.
