The U.S. agreed to remove Section 232 tariffs on pharmaceutical goods from the United Kingdom, according to a Monday press release from the White House.
The proposed deal includes U.K.-based pharmaceuticals, pharmaceutical ingredients and medical technology, per the release. Further, the U.S. will not target U.K. pricing practices in any future Section 301 investigation during President Donald Trump’s term.
The tariff exemption is in exchange for an agreement on pharmaceutical pricing between the U.S. and U.K., according to the release. Under the framework agreement, the U.K. will reverse declining National Health Service expenditures on medicines, and up the net price it pays for new medicines by 25%. Further, the U.K. will ensure that higher prices for new medicines are not impacted by a demand for portfolio-wide concessions under the Voluntary Scheme for Branded Medicines Pricing, Access and Growth, or other rebate schemes.
The latest announcement is part of the U.S.-U.K. Economic Prosperity Deal framework announced in May, which targeted tariffs and market access and included proposals for the pharmaceutical industry. If the pact is finalized, the Trump administration would keep its 10% tariff on U.K. imports. In return, the U.K. would cut tariffs on U.S. goods from 5.1% to 1.8%.
Trump continues to target pharmaceutical imports as part of his sector-specific tariff strategy, with the Commerce Department initiating a Section 232 investigation into the pharmaceutical industry in April. In August, Trump said levies could eventually reach 250%.
Trump later announced plans to implement a 100% sector-specific tariff on branded or patented pharmaceutical products in September. That same month, the U.S. launched a Section 232 probe into healthcare-related products, including surgical masks, syringes and pacemakers.
