The MFN Illusion: Why the UK may be the first market to lose access
US Most Favoured Nation (MFN) pricing is often understood as a technical question of pricing rules. In reality, it reshapes incentives in ways that change company behaviour and may leave the UK more exposed, not less. As a structurally low price market, the UK risks becoming a rational candidate for launch deferral or exclusion.
Chris Brown says that this raises fundamental questions for policymakers about how pricing frameworks are designed and experienced by companies making real-world launch decisions. Addressing this will require moving to more dynamic, negotiation-led strategies that reflect how the system actually operates.
The problem with fixed thinking
I was struck recently by a conversation in UK policy circles.
There are still some very senior people who believe that UK medicine launches are insulated from the effects of US Most Favoured Nation (MFN) pricing. The reasoning is superficially reassuring. It is also mistaken.
The argument runs as follows. The proposed US model references the second lowest price across a basket of comparator countries. The UK, more often than not, sits at or close to the bottom of that distribution. So its price, while low, does not directly anchor the US reference point. Therefore, the UK is protected.
This rests on a critical assumption however - that the basket of countries is fixed. It isn’t.
Pharmaceutical companies do not face a static system. They shape it. Launch decisions - where to launch and when to launch - determine which countries appear in the pricing basket in the first place. Those decisions are not incidental. They are among the most consequential strategic choices a company makes, and they have just become much more so thanks to US adoption of net price referencing.
Once you allow for that, a different dynamic emerges.
A simple shift — with disproportionate impact
Imagine that amongst the US’s defined basket of eight countries, the price payers are willing to accept is ranked from lowest to highest as follows: the UK, Canada, France, Italy, Denmark, Japan, Germany and Switzerland.
If a company launches in all eight, the second lowest price – Canada - sets the MFN reference point.
Now suppose the company declines to launch in the UK. Canada becomes the lowest. France becomes the second lowest - and France's price is higher than Canada's. The MFN reference just went up. The company's US revenue position just improved.
That's the selection effect. By not launching in the UK, the company doesn't merely remove the UK's low price from the basket. It shifts the entire remaining ranking upward, raising the MFN reference and improving US economics. The "protection" some in UK policy imagine - that UK prices won't matter because they're already the lowest priced - is illusory. Being the lowest priced makes the UK the most rational country to exclude, because exclusion delivers the largest uplift to the MFN reference price.
That is the selection effect. And once you see it, the apparent protection offered by the UK’s low prices turns inside out.
The real question for the UK
This is not a technical point about basket construction. It is a strategic one about behaviour under changed incentives.
The question is no longer: where does the UK sit in the price ranking? It is: does the MFN framework make launching in the UK less attractive than not launching at all?
If it does, the system will respond accordingly - not through policy debate, but through commercial choice.
That is what makes this moment uncomfortable. It reveals a tension that UK pricing policy has managed, but not fully resolved, for some time.
On one side, NICE thresholds and access mechanisms have delivered strong value for the NHS and for patients. On the other, they have entrenched a position as a structurally low-price market.
Under MFN, that position suddenly carries a penalty: a much stronger incentive for companies to opt out altogether.
A problem without simple solutions
There is no clean fix for this.
Governments need to make bold policy adjustments. But even that will not fully resolve the underlying dynamic, because the interaction is not confined to policy design. It sits in the strategic space between governments and companies — in how each anticipates and responds to the other.
For companies, this shifts the problem decisively out of the realm of technical pricing and into something broader.
It becomes a negotiation problem.
Navigating the new landscape
What does that mean in practice?
First, it demands a more granular understanding of what policymakers need. Price matters, but it is rarely the only variable. Access, fiscal control, political credibility, industrial policy: all sit alongside it. The art lies in identifying where there is genuine flexibility – recognising of course, policymakers themselves operate in a landscape of internal government negotiations, which must be understood and accommodated.
Second, it requires activity away from the formal negotiating table. The outcomes here will not be determined solely in bilateral discussions. They will be shaped by stakeholders across the system - clinicians, patient groups, investors, departments - whose interests and influence need to be engaged deliberately.
Third, it pushes deal design into new territory. If the traditional levers become constrained by MFN exposure, then new structures are needed that can reconcile payer requirements with the commercial realities of global reference pricing. These will not be uniform. Each company’s exposure profile is different, so the solutions will be too.
Finally, it places a premium on convening - on bringing the right participants together, at the right moment, under the right conditions. In my experience, breakthroughs in complex public–private negotiations rarely emerge within standard pathways. They are usually the product of carefully constructed conversations that sit just outside them.
None of this is simple, and none of it resolves itself. If you're thinking through what it means for your portfolio, your pipeline, or your market access strategy, we'd be glad to help.