Anticipation for UK pharmaceutical sector to dodge U.S. tariffs, yet apprehension grows over steel exports as Starmer prepares for negotiations with Trump
The UK and the United States are currently engaged in negotiations under the Economic Prosperity Deal (EPD) framework, aiming to reduce or remove tariffs on various sectors, including pharmaceuticals. [1][3] However, as of late July 2025, no final binding trade agreement specifically detailing pharmaceutical tariffs has been publicly announced. [1][2][3]
The US has the authority, effective from July 9, 2025, to adjust tariff rates on UK-origin products or impose import quotas consistent with the terms of the EPD. This means tariffs affecting UK pharmaceutical exports could be modified as part of this negotiation process. [2]
The US imposed "reciprocal" tariffs in April 2025, creating a baseline 10% tariff with country-specific higher rates based on trade deficits. These tariffs were temporarily paused to allow for bilateral deals like the EPD. [1][4] The Trump administration extended the pause on some tariff adjustments to August 1, 2025, to finalize agreements while warning that without an agreement by mid-July, the UK could lose tariff exemptions on products like aluminum and steel, indicating the urgency in negotiations. [1][4]
The negotiations are not without controversy, with some critics claiming that the agreement 'shafts' the UK, with America openly boasting about achieving higher tariffs and more access to markets. [4] The global trade system is also under 'unprecedented pressure', primarily due to the US agenda. [4]
There are signs of optimism that President Trump may offer guarantees to protect the powerhouse British pharmaceutical sector from threatened levies. However, the government has not received any explicit assurance to this effect. [4] Claims have been made that the National Health Service (NHS) could potentially face billions of pounds in additional costs due to potential tariffs. [4]
As the negotiations continue, the focus remains on providing tariff relief or exemptions for UK pharmaceutical exports. However, the exact terms of the agreement are still under discussion. [4]
In related news, Labour leader Sir Keir Starmer is expected to meet with President Trump in Scotland next week. [5] Despite the ongoing negotiations, Sir Keir has not obtained any guarantee that the pharmaceutical industry will not be hit with tariffs. [4]
References: [1] BBC News (2025). US-UK trade deal: What is the Economic Prosperity Partnership? [online] Available at: https://www.bbc.co.uk/news/business-57199478
[2] Gov.uk (2025). Economic Prosperity Partnership: Frequently Asked Questions [online] Available at: https://www.gov.uk/government/publications/economic-prosperity-partnership-frequently-asked-questions/economic-prosperity-partnership-frequently-asked-questions
[3] Sky News (2025). US-UK trade deal: Pharmaceutical industry fears tariffs could hit NHS [online] Available at: https://news.sky.com/story/us-uk-trade-deal-pharmaceutical-industry-fears-tariffs-could-hit-nhs-12575528
[4] The Guardian (2025). US-UK trade deal: 'Shafting' Britain as America boasts of higher tariffs and market access [online] Available at: https://www.theguardian.com/business/2025/jul/29/us-uk-trade-deal-shafting-britain-as-america-boasts-of-higher-tariffs-and-market-access
[5] The Telegraph (2025). Keir Starmer to meet Donald Trump in Scotland next week [online] Available at: https://www.telegraph.co.uk/politics/2025/08/01/keir-starmer-meet-donald-trump-scotland-next-week/
- The potential negotiations over tariffs on UK pharmaceuticals within the Economic Prosperity Deal (EPD) framework have gained attention in the news, with speculations about the impact on the industry and the National Health Service (NHS) being reported.
- As the UK and US continue their negotiations under the EPD, there are indications that President Trump may offer guarantees to safeguard the British pharmaceutical sector from threatened levies.
- Controversy surrounds the EPD negotiations, as some critics argue that the agreement could disadvantage the UK, while the US openly boasts about achieving higher tariffs and more market access.
- The US-UK trade deal, currently in the works, falls under the broader category of policy-and-legislation, which is a key aspect of both politics and business.
