A landmark trade agreement between the United Kingdom and the United States has ignited significant concern among health policy experts, who fear it will force the NHS to allocate more of its budget to expensive new medicines at the expense of staff pay and established treatments.
The Deal and Its Immediate Impact
Under the terms of the new deal, the UK has agreed to pay 25% more for innovative new medicines developed in the United States. This commitment involves doubling the percentage of GDP the country allocates specifically for purchasing these therapies. The US administration has explicitly stated it hopes other nations will follow the UK's lead.
UK health experts have reacted with alarm, warning that the agreement will inevitably strain NHS finances. The core fear is that a larger share of the health service's budget will be diverted to fund these high-cost new drugs, leaving less money available for staffing, salaries, and proven existing treatments.
Global Repercussions and the Australian Response
The international ramifications are already being felt, with Australian Health Minister Mark Butler stating his government is actively trying to understand this "dynamic shift" in the global pharmaceutical market. Butler emphasised the strength of Australia's Pharmaceutical Benefits Scheme (PBS) but confirmed the government is engaging closely with both the US administration and global drug companies.
Professor Libby Roughead, director of the University of South Australia's quality use of medicines centre, cautioned that the UK move represents more than a loosening of cost-effectiveness rules; it is effectively "throwing it out." She warned that while global repercussions are "inevitable," Australia's robust system should not cause panic, but the fundamental question remains: "When is new good? When is new better? And when is new not so good?"
A 'Problematic Precedent' for Public Health
Dr Barbara Mintzes, a professor of evidence-based pharmaceutical policy at the University of Sydney, labelled the agreement a "very problematic precedent." She expressed deep concern about the influence of trade policy on domestic public health services, noting the NHS's existing underfunding. "It sets a very problematic precedent in terms of the influence of trade policy on domestic public health services," Mintzes stated.
She further warned that the US success in the UK could lead to pressure on other countries, including Australia, for similar deals. "Hopefully Australia would not agree to any deal with the US that uses tariffs as a tool to force up pharmaceutical prices," she added.
In Australia, the pharmaceutical industry body Medicines Australia said the UK-US deal reinforces the urgent need for domestic reforms to the Health Technology Assessment (HTA) process, which determines which medicines are approved for public subsidy. A 2024 review of the HTA made 50 recommendations aimed at improving patient access to new treatments.
The overarching consensus among independent experts is clear: the UK-US deal signals a marked shift away from value-for-money assessments for medicines, a cornerstone of sustainable public healthcare systems worldwide. The coming months will reveal how other nations, including Australia, respond to this new pricing pressure from the world's largest pharmaceutical market.
