Donald Trump, Brexit, and Britain’s National Health Service

Companies can haggle to get approval – but those agreements remain confidential. Take Kadcyla, a breast-cancer drug developed by Roche Holding AG. At a price of 90,000 pounds, NICE decided it wasn’t cost-effective. But some 115,000 people signed a petition calling it for it to be made available. Eventually, the NHS and Roche negotiated a deal allowing the estimated 1,200 people in the UNITED KINGDOM affected by the cancer to use it.

In future trade talks, U.S. drug companies will push for more transparency in the NHS’s decision-making process and an appeals process, too. They will also want more patent protection. But their real hope will be for higher prices and more reimbursement approvals. Because many other countries use NHS pricing decisions as a reference point, the issue is a major one for U.S. firms with lobbying clout in Washington.

These conversations are now standard in U.S. trade talks. Some countries, such as Australia, have vigorously resisted pressure to open their markets further. But the renegotiated free-trade deal with South Korea includes higher payments for American-made drugs. And there are concessions, too, in the revised NAFTA agreement, though Democrats in Congress have decried the move as an attempt to entrench America’s high drug pricing and export it.

Those claiming the United Kingdom could spend more on health care aren’t wrong. The OECD’s estimates of pharmaceutical spending per person in 15 EU countries put the United Kingdom in the bottom half. At 9.6% of GDP, U.K. health spending doesn’t just trail the United States, but France and Germany as well.

The irony is that the NHS has a far bigger problem to worry about than Brexit or trade negotiations. The United Kingdom’s health system, set up after World War II, is under extreme stress from a growing and aging population. While most Britons value a system that is free at the point of delivery and will do anything to protect it, the price is rationing, long wait times and wide regional disparities in available treatments.

The NHS’s defenders note the service delivers well for its relatively low cost. But it is also overburdened and understaffed – not helped by the government’s decision to make it harder to hire skilled foreign workers to plug the gaps. May has promised to increase NHS spending through 2023, but only by about 3.4% a year, not enough to plug the many holes in the service.

All of these issues are now rumbling in the background of the Conservative leadership race – but they will eventually be front and center. Once, the party would have led a conversation about NHS reform. Now, it must appease leave-supporting voters who were promised additional spending. That sensitivity will make any trade deal with the United States, another prize Tory Brexiters pledged, more complicated.

At least Trump, who has many reasons to welcome Brexit, has forced an important conversation about priorities and trade-offs as a new leader tries to deliver Brexit. Now there can be no discussion of leaving the EU that doesn’t include the NHS. Thanks to the U.S. president, U.K. Conservatives now have a dilemma as they choose their new leader. Which do they care about more: Brexit or the NHS?

— For more columns from Bloomberg Opinion, visit http://www.bloomberg.com/opinion.

Therese Raphael writes editorials on European politics and economics for Bloomberg Opinion. She was editorial page editor of the Wall Street Journal Europe.

Copyright 2021 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.