US Ambassador Warns of Pharma Industry Exodus Unless UK Reforms Drug Pricing

The UK is facing mounting pressure from the United States to reform its drug pricing policies, with the US ambassador, Warren Stephens, delivering a stark ultimatum to government officials and business leaders. Speaking at the prestigious BritishAmerican Business gala lunch held at the Savoy Hotel in London, Stephens cautioned that unless reforms to drug prices are implemented promptly, major pharmaceutical companies could withdraw existing investments and close their facilities across Britain.

Stephens’ warning comes amid ongoing negotiations between No 10 and the White House about a potential agreement that would see Britain increase the price it pays for certain medicines in exchange for improved tariff conditions for UK pharmaceutical exports. US pharmaceutical giants, such as Eli Lilly, Johnson and Johnson, MSD, AbbVie, and Bristol Myers Squibb, are among those represented within the BritishAmerican Business association, underscoring the scale of transatlantic business interests at risk.

The pharmaceutical sector in Britain is already feeling the strain. Notably, leading firms have recently halted or cancelled multimillionpound investments in the UK. Eli Lilly suspended part of its planned investment in a biotech innovation hub in London, Merck known as MSD in Europe withdrew from a £1 billion research centre, and AstraZeneca put on hold a £200 million expansion at its Cambridge headquarters. Stephens emphasised that industry giants are growing increasingly frustrated with the high costs imposed by the voluntary scheme for branded medicines pricing access and growth, which caps NHS drug expenditure while aiming to foster innovation within the sector.

The ambassador’s intervention comes at a time when delays in reaching an agreement are being linked to the ongoing US government shutdown. Meanwhile, AstraZeneca and Pfizer have struck individual deals with the Trump administration, navigating the uncertainty through direct negotiations. Industry sources report concern over a rising list of drugs not offered to UK patients, as global companies reassess the attractiveness of the British market.

Talks between the Association of the British Pharmaceutical Industry and the health department ended abruptly in August after a breakdown over NHS spending proposals. Recent months have seen prominent government figures acknowledge the need for increased investment in NHS medicine procurement. Lord Vallance, a former GSK executive now serving as science minister, has indicated to MPs that increased spending is necessary to sustain the competitiveness of Britain’s life sciences sector.

Officials from the Department of Health and Social Care insist patient needs will always come first, while affirming that negotiations with US counterparts are in advanced stages. Both sides appear committed to forging a balanced solution that will secure Britain’s continued access to medical innovation and maintain its standing as a global leader in the pharmaceutical industry.