[co-authors: Westley Trimble, Jon Botham, Uendi Barreti, Paola Paccani]
We're delighted to share our Knowledge team's insights on the most important legal changes affecting the Health & Life Sciences sector around the globe.
US-India Interim Trade Agreement
On February 6, the US and India jointly announced a framework for an Interim Agreement on trade. This supports ongoing negotiations for a broader Bilateral Trade Agreement started in February 2025. India plans to cut tariffs on many US industrial, food and agricultural goods. The United States will apply an 18 percent reciprocal tariff on selected Indian goods but will remove several tariffs once the agreement is concluded. Both countries intend to reduce non‑tariff barriers and align standards in priority sectors. India could receive preferential quotas on pharmaceuticals. Both nations aim to strengthen supply chain security, expand technology trade, and cooperate on investment reviews and export controls. India said it would buy $500 billion in US goods over five years.
On February 9, the White House issued a fact sheet in support of the announcement.
Impact: Businesses across multiple sectors could expect improved access to both countries through tariff cuts and reduced non‑tariff barriers. Pharmaceutical businesses could see expanded opportunities. Exporters could prepare for new tariff and standards rules.
Considering the US Supreme Court ruling on tariffs, the future and enforceability of this trade agreement could remain uncertain. See Eversheds Sutherland insight on this ruling.
EU and India sign Free Trade Agreement
On January 27, the EU and India concluded a landmark Free Trade Agreement (FTA). The deal removes major trade barriers, streamlines customs procedures, expands market access, and supports supply chain diversification.
Together, the tariff schedules cover the vast majority of goods traded between the EU and India, with India liberalizing 96.6% of EU exports and the EU liberalizing 99.5% of its tariff lines. Tariffs on EU pharmaceuticals will be phased out over 5–10 years.
The agreement now awaits approval by the European Parliament and the Council. Once ratified by India, it can enter into force. Tariff cuts and regulatory changes will be phased in gradually over a period of up to ten years.
Impact: Tariff reductions are expected to benefit European businesses broadly. The agreement is expected to create new opportunities for a wide range of businesses, including SMEs. However, specific SME-targeted measures have not yet been detailed publicly.
The European Commission estimates €4 billion in annual duty savings and expects that EU exports to India will double by 2032.
To prepare, businesses should:
- review sector specific tariff reduction schedules
- identify products most affected by duty cuts
- reassess supply chains and logistics costs as market access conditions evolve
Companies in the health and life sciences sector should assess not only tariff reductions but also local regulatory requirements relating to marketing authorization, quality certifications, and intellectual property obligations. A comprehensive assessment will help them maximize the benefits of the agreement, mitigate regulatory risks, and ensure the uninterrupted supply of critical products in international markets.
EU: Trade agreement with Mercosur signed
On January 17, the European Union and the Mercosur bloc (Argentina, Brazil, Paraguay and Uruguay) formally signed the long negotiated trade agreement, marking the conclusion of over 25 years of negotiations. The signing took place in Asunción, Paraguay, and creates what EU officials describe as the world’s largest free trade area, covering roughly 700 million people.
The European Parliament will have to give its consent. However, the ratification process now faces a certain level of uncertainty. On January 21, the European Parliament narrowly voted to refer the agreement to the European Court of Justice for legal review, suspending Parliament’s approval procedure. The review is expected to delay any final decision.
The Mercosur agreement aims to establish the largest free trade zone, aiming to phase out most tariffs while applying special schedules for sensitive sectors. The agreement aims to phase out around 90% of tariffs across industrial, agricultural and services sectors. It maintains special timetables and safeguards for sensitive agricultural products, including clauses allowing the EU to reintroduce tariffs if imports surge beyond agreed thresholds. On market access, the deal expands opportunities in services, digital trade, public procurement and investment, enabling EU companies to participate in Mercosur public tenders on equal terms with domestic bidders.
The agreement also protects 344 Geographical Indications and strengthens supply chain access for critical raw materials, reducing EU reliance on third country suppliers.
Impact: The agreement offers companies notable tariff savings, broader market access, and more diversified supply chains, particularly in sectors such as automotive, chemicals, agri food, and green technologies. SMEs may benefit from simplified procedures and improved access to procurement and partnership opportunities. At the same time, businesses should anticipate the need to adjust supply chains and manage additional regulatory and reporting obligations as the framework evolves.
Eversheds Sutherland: A Landmark Deal In The Making: Unlocking Business Opportunities in the EU-Mercosur Trade Agreement
UK-Singapore partnership to speed up access to new health technologies
On December 12, the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) and Singapore’s Health Sciences Authority (HSA) announced a regulatory innovation initiative to speed up patient access to breakthrough health technologies. MHRA and HSA will offer coordinated, early joint advice, enabling developers to engage both regulators simultaneously. The pathway aims to reduce duplication, improve trial design, cut delays, and maintain safety standards. Priority areas include cancer, neurodegenerative disease, obesity, rare diseases, advanced diagnostics, and digital health.
The collaboration supports life sciences investment and strengthens both countries as global regulatory innovation hubs. The partnership builds on wider initiatives, including AI regulation collaboration and streamlined access pathways.
Impact: Health and life sciences companies may want to engage with the process to take advantage of any areas where collaboration could help avoid duplication and reduce development delays. This initiative may influence other international regulators and further collaborations could lead to accelerated routes to market.
UK-US pharmaceuticals deal
On December 1, the UK Government announced a deal to secure a zero percent tariff on pharmaceuticals to the US. The deal guarantees zero tariffs on UK pharmaceutical exports to the US for at least three years. In return the government will increase the National Institute for Health and Care Excellence (NICE) cost-effectiveness threshold by 25% for new US drugs. It will also cut the cap on revenue the NHS can reclaim from pharmaceutical businesses to no more than 15%.
UK government officials claim the deal will speed patient access to innovative treatments and support UK life sciences.
Impact: Pharmaceutical businesses could benefit from early launches due to tariff-free exports and improved pricing frameworks. Investment in UK-based research and manufacturing could benefit from government incentives. This could boost the UK's role in pharmaceutical supply chains. US pharma could benefit from higher NHS spending and revised NICE thresholds.
Considering the US Supreme Court ruling on tariffs, the future and enforceability of this deal could remain uncertain. See Eversheds Sutherland insight on this ruling.
China: Updated Implementing Regulations on Drug Administration Law
On January 27, the State Council released regulations for implementing China's Drug Administration Law. This aims to encourage pharmaceutical innovation, tighten oversight of online medicine sales, and strengthen drug safety supervision. They outline requirements for research, clinical trials, production, distribution, and post‑market evaluation. The regulations strengthen responsibilities for Marketing Authorization Holders (MAHs) and set strict standards for quality control and traceability. They also reinforce data protection for new drugs and provide market exclusivity periods for rare‑disease and pediatric medicines. Overseas research data may be used if it meets Chinese standards. The rules expand risk‑control tools and clarify penalties for violations across the drug lifecycle.
The regulations will apply to domestic and overseas manufacturers selling products in China. They take effect from May 15, 2026.
Impact: Pharmaceutical manufacturers could benefit from new incentives, including up to seven years of market exclusivity for eligible orphan drugs and two years for new pediatric drugs. Manufacturers using overseas clinical data should ensure full compliance with Chinese standards and technical specifications. Foreign MAHs may want to strengthen their domestic representation with robust quality and risk‑control systems. Companies involved in online pharmaceutical transactions will need to meet tightened requirements on quality management, operator verification, and information display.
Singapore: Agentic AI governance framework published
On January 22, the Infocomm Media Development Authority (IMDA) issued a framework for agentic AI to guide responsible use of advanced AI agents. The framework aims to support safe adoption while maintaining trust, safety, and accountability.
The framework introduces four pillars: upfront risk assessment; clear human accountability; technical controls; end user responsibility. It highlights risks unique to agentic systems, including erroneous actions, unauthorized access, biased outcomes, and unintended system level effects.
The framework is intended to help organizations manage the growing capabilities of agentic AI with practical controls and safeguards.
Impact: Businesses adopting agentic AI should:
- strengthen internal governance, especially around human oversight, permissions, and risk management
- build adaptive structures that can evolve as agent capabilities change
- establish clear approval points for high risk actions and ensure that human reviewers understand common agent failure modes
- invest in training so users understand agent behavior, limits, and responsibilities
Eversheds Sutherland: Understanding Singapore’s new Model Framework for Agentic AI Governance
South Korea: AI Basic Act enacted and brought into force
On January 22, South Korea enacted and fully brought into force the AI Basic Act. The Act establishes a national framework governing the development, deployment, and use of AI systems in South Korea.
The Act:
- establishes South Korea’s AI framework to support innovation and trust
- empowers the Ministry of Science and Information and Communication Technology to set national AI plans and oversee safety
- creates the National AI Committee to guide major policy decisions
- supports research and development, data policy, small and medium-sized enterprises, startups, and human‑capital development
- promotes ethical principles and international norms
- mandates transparency and safety duties, particularly for high‑impact AI systems that pose significant societal risks
Impact: Organizations working with AI must adhere to the Act and its regulations, with particular attention to requirements on transparency and safety.
Eversheds Sutherland: South Korea: Enactment of AI law
Singapore: Health Information Act passed
On January 12, Parliament passed the Health Information Act, it’s expected to take effect from early 2027. It mandates the sharing of key patient data across all licensed healthcare providers. Providers will have to submit information such as allergies, diagnoses, medications, tests and discharge summaries into the National Electronic Health Record (NEHR). Safeguards will be in place to restrict access to patient care purposes only, with patients able to monitor or limit access. Some critical information stays accessible during restrictions to prevent unsafe treatment. Providers and authorized entities must meet cybersecurity and data security requirements.
The Act aims to help the delivery of safer and more seamless care across the healthcare system. Aiming to cut errors, avoid duplicated tests, and improve continuity of care.
The misuse of data will be a criminal offence. Improper access to the NEHR by insurance companies or employment recruiters could result in fines or imprisonment.
Impact: Healthcare providers and businesses should use the next few months to make sure they are familiar with the Act’s requirements, and ensure their data privacy measures are adequate. They should take advantage of any government training or financial assistance offered. The Ministry of Health should be notified immediately of any cybersecurity incidents or data breaches.
China: Fourth encouraged generic drugs catalog released
On January 7, the Ministry of Industry and Information Technology announced details of the fourth catalog of encouraged generic drugs to improve supply and competition. The list includes 21 drug varieties and 47 specifications across multiple therapeutic areas. This includes include oncology, neurology, assisted reproduction, and diagnostic imaging, prioritizing drugs with new targets and novel mechanisms.
Multiple agencies jointly selected drugs with expiring domestic patents or clinical supply shortage. Health, industry, intellectual property, insurance, and drug regulators coordinated the selection and issuance. It aims is to boost research, clinical trials, and fast-track approval for these generics, ensuring better availability and competition in the pharmaceutical market.
Impact: Manufacturers may want to take advantage of any support offered for conducting trials, scaling production, and seeking priority approvals. They may want to prioritize the government listed products for research, development, and production.
China: National and commercial drug catalogs updated
On December 7, the National Health Insurance Administration and the Ministry of Human Resources and Social Security announced the 2025 national drug catalogs for basic, maternity, work-injury, and commercial insurance.
The updates added 114 drugs, including 50 Class 1 innovative medicines. It aims to improve access to medicines and support innovative drugs. 29 drugs were removed, while overall listings rose to 3,253. Coverage improved for tumors, chronic diseases, mental illness, rare diseases, and pediatric medicines. The measures aim to strengthen hospital access, dual-channel drug management, fund monitoring, and fraud prevention.
The new lists took effect from January 1, 2026.
Impact: Domestic pharmaceutical manufacturers could benefit from the new lists, especially innovative treatments. Imported drugs with strong domestic competition could face barriers. However, imported drugs without domestic alternatives could see increased opportunities.
EU: Parliament advances Critical Medicines Regulation to tackle supply shortages
On January 20, the European Parliament (EP) adopted its position on a proposed Critical Medicines Regulation designed to help address shortages of essential medicines such as antibiotics, insulin, vaccines and treatments for chronic diseases.
The EP’s position sets out priorities for future negotiations with EU governments on the final text of the law, advancing the initiative into the trilogue phase.
Key elements include support for EU‑based manufacturing projects, investment incentives, and a “Buy European” approach in public procurement to strengthen supply chains and boost competitiveness.
The draft also proposes voluntary cross‑border procurement and improved coordination of national stocks.
Impact: The EP’s advancement shapes EU legislative debate on medicine shortages. It affects pharmaceutical manufacturers, healthcare suppliers and public procurers. National authorities and businesses may need to consider EU manufacturing incentives and procurement criteria. Public procurement may give preference to suppliers with significant EU production. Support for strategic projects could influence investment decisions in manufacturing capacity. Coordination of national stockpiles may impact how shortages are managed.
Life sciences companies should proactively assess their production and distribution capacity within the EU, identify strategic projects eligible for incentives, and adjust their public procurement plans and national stock management accordingly. This forward‑looking preparation will help them maximize the benefits of the regulation while mitigating risks linked to potential shortages of critical medicines.
No legal obligations arise until the regulation is formally agreed and adopted.
EU: Over €307 million investment on artificial intelligence
On January 15, the European Commission (EC) launched two Horizon Europe calls worth €307.3 million to advance strategic digital technologies. The funding aims to boost Europe’s innovation capacity in AI, data services, quantum, robotics, photonics and virtual worlds. The EC also seeks to reinforce EU digital sovereignty through support for next generation applications and foundational technologies.
- €221.8 million is allocated to fund trustworthy AI, innovative data services and strategic digital autonomy
- €40 million is assigned to the Open Internet Stack Initiative
- €85.5 million is set aside for the second call supporting strategic autonomy in emerging technologies and raw materials
Impact: Businesses may apply for funding until April 15, 2026.
Businesses may gain new funding for:
- enhancing their service quality with AI tools
- accelerating automation processes with robotics for industrial applications
- optimizing their workflows thanks to access to next‑generation quantum computing
Companies seeking Horizon Europe funding should proactively assess how their projects support EU digital sovereignty, prioritizing initiatives in trustworthy AI, strategic data services, and emerging technologies. Preparing proposals that are closely aligned with European policy objectives will increase their chances of success and facilitate access to key resources for innovation and technological development.
EU: First draft code of practice on AI content transparency
On December 17, the European Commission released the first draft Code of Practice on marking and labelling AI-generated content to support compliance with Article 50 transparency obligations under the EU AI Act.
The draft includes rules for providers of generative AI systems to mark content in machine-readable formats and requirements for deployers to label deepfakes and AI-generated text on matters of public interest.
Impact: Feedback closed on January 23, 2026, with a second draft expected by mid-March and finalization in June 2026. Transparency obligations will apply from August 2, 2026. The Code is voluntary but designed to help demonstrate compliance and enhance trust in AI content across the EU.
Life sciences and healthcare companies should implement internal procedures to clearly mark and label AI‑generated content in line with the EU Code of Practice. Doing so will support regulatory compliance and enhance trust among patients and healthcare professionals in digital content produced with AI systems.
EU: New plan to strengthen preparedness for cross border health crises
On November 28, the European Commission unveiled a new Union wide prevention, preparedness and response plan aimed at improving readiness for cross border health emergencies across EU Member States. The plan seeks to enhance coordination, resources and mechanisms for crisis response, ensuring faster and more unified action in case of pandemics or other transnational health threats.
Impact: The plan may lead to stronger collaboration between public health authorities across the EU, potentially speeding up crisis response and sharing of medical resources. Health service providers and suppliers of medical equipment could benefit from clearer demand forecasts and increased procurement activity. The overall health infrastructure may become more resilient, possibly reducing disruption for businesses and patients in future crises.
Pharmaceutical and life sciences companies should align their production and supply capabilities with the mechanisms of the European preparedness framework for health emergencies, ensuring the availability of critical products and the capacity to respond rapidly in crisis situations. Active participation in cross‑border cooperation initiatives will enable them to maximize public procurement opportunities and enhance their resilience during emergencies.
EU: 2026 Work Program for Health Technology Assessment adopted
On November 28, the Health Technology Assessment Coordination Group (HTACG) adopted the annual work program for 2026 under EU Health Technology Assessment Regulation. The program outlines key planned activities and strategic priorities for the year ahead.
Impact: The adoption may lead to more coordinated assessments of medical technologies across the EU, which may streamline regulatory approval processes and reduce duplication for businesses. Medical device makers, biotech firms and healthcare providers might benefit from clearer and more predictable assessment frameworks. Patients and public health systems may also gain from faster access to innovative treatments. Increased transparency and consistency across member states may foster cross border collaboration and investment.
Medical device, biotechnology and healthcare service companies should proactively prepare their documentation and regulatory strategies in line with the 2026 HTA Work Program, ensuring readiness for coordinated EU assessments. Aligning early with the program’s priorities will support compliance, reduce procedural duplication, and help companies leverage increased transparency and consistency across Member States to accelerate patient access to innovative treatments.
EU: Guidance for AI data protection risks published
On November 20, the European Data Protection Supervisor issued guidance on risk management for AI systems processing personal data within EU institutions. It aims to strengthen compliance with the EUDPR and protect fundamental rights.
The guidance introduces a framework based on ISO 31000:2018. It focuses on risk identification and treatment across the AI lifecycle and highlights procurement obligations for transparency and pre-budget risk evaluation. It stresses interpretability and explainability as cross-cutting requirements to ensure accountability and trust. Key principles addressed include fairness, accuracy, data minimization, security, and data subject rights. Associated risks include bias, data drift, indiscriminate collection, and breaches, alongside mitigation measures like bias audits, retraining, anonymization, encryption, and machine unlearning.
The document concludes that systematic risk management and continuous monitoring are essential for lawful and ethical AI deployment in EU bodies.
Impact: Although addressed to EU regulators, the guidance indirectly impacts businesses by shaping future compliance expectations and procurement standards. It signals stricter requirements for transparency and risk mitigation obligations, raising technical and ethical benchmarks across the market. The guidance informs policy debates and decision-making, meaning businesses may anticipate similar obligations in upcoming legislation and sector-specific rules.
Pharmaceutical and life sciences companies should establish an internal risk‑management framework for AI systems processing personal data, aligned with the EDPS guidance. This should include measures such as bias audits, anonymization techniques and algorithmic explainability to ensure future compliance and to strengthen trust among patients, regulators and other stakeholders in their AI‑enabled systems.
UK: New clinical trial regulations seek to speed up process
On January 13, the Medicines and Healthcare products Regulatory Agency (MHRA) highlighted upcoming major reforms aimed at speeding up clinical trial approvals and attracting global research investment. New MHRA data shows a rise in clinical trial activity during 2025, especially in early‑phase studies.
New regulations take effect from April 28, 2026, introducing a fast‑track route for low‑risk studies and a 14‑day assessment for phase 1 trials. These changes aim to support innovation, use international safety data, and integrate computer‑based modelling. The reforms aim to support faster trial start‑up, clearer regulatory pathways and improved competitiveness.
Impact: The government is investing significantly in an attempt to boost research. Health and life sciences businesses could benefit from the fast‑track notification route for low‑risk studies. Businesses should integrate the new statutory duties into their compliance frameworks for any upcoming clinical trials. They may want to take advantage of any MHRA guidance and training.
UK: Government plans transparency guidance on industry payments to healthcare
On December 18, the government responded to a consultation on the disclosure of industry payments to the healthcare sector. This was launched in 2023 and sought views on the first UK legislation for the disclosure of payments and other benefits from health and life sciences businesses to health organizations and professional.
The Department of Health and Social Care stated it would develop and publish guidance on best practice for industry to follow. It will aim to advise on which payments should be reported, the format of the reporting, and the frequency.
The government has stated it is keen to reduce the regulatory burden on the health and life sciences sector. It believes a non-regulatory approach will speed up industry reporting for consumers. The government intends to monitor uptake and may take further action if required.
Impact: The proposed best practice guidance is possibly the best outcome for businesses. Any so-called “Sunshine Act”, common in other countries, could have made the regulatory burden on business significant. The guidance is expected within months and will incorporate stakeholder input. Businesses should still prepare for some form of increased reporting on payment transparency. Future legislation remains a possibility if voluntary guidance proves insufficient.
UK: MHRA seeks evidence on AI regulation in healthcare
On December 18, the Medicines and Healthcare products Regulatory Agency (MHRA) announced a call for evidence on regulating artificial intelligence in healthcare. This seeks to inform recommendations from the National Commission into the Regulation of AI in Healthcare, shaping future standards. The government aims to support safe, fast, and trusted AI use across the health service.
The call for evidence ran to February 2, 2026, the findings will be used to inform MHRA recommendations in 2026.
Impact: Healthcare organizations and innovators may be interested in the outcome of the call for evidence. AI could support productivity and growth in the sector, streamlining some labor intensive processes. However, it presents new regulatory and oversight challenges.
UK: Medicine rebate rate
On December 10, the Department of Health and Social Care announced a rebate rate reduction for branded medicines under the voluntary scheme for branded medicines pricing, access and growth (VPAG). The rate drops from 22.9% in 2025 to 14.5% in 2026.
This move aims to make the UK more attractive for clinical trials, manufacturing investment, and early launches of innovative medicines. It follows the UK-US pharmaceutical deal securing 0% tariffs on branded drugs. The lower rate aims to accelerate patient access to cutting-edge treatments, reduce National Health Service (NHS) costs, and stimulate economic growth. Ministers emphasized the importance of innovation in improving health outcomes and sustaining the NHS.
Impact: Pharmaceutical manufacturers could benefit from the reduced rebate rate to invest in UK-based clinical trials and early product launches. Businesses may want to consider maintaining VPAG participation as statutory scheme rates are higher.
US: FDA moves to speed up pharmaceutical approvals
On February 18, Dr Vinay Prasad and Dr Marty Makary, Food and Drug Administration (FDA) leaders, authored a New England Journal of Medicine article (may require registration). This outlined a policy shift, changing the FDA’s default requirement for drug approval from two clinical trials to one pivotal trial combined with confirmatory evidence. The change is aligned with the current Administration’s aim of reducing development costs and speeding up market entry for new therapies. The FDA may still require two studies where evidence is unclear or limited.
On February 23, the FDA announced a new framework for accelerating personalized therapies for ultra-rare diseases. This allows companies to work with small well controlled groups instead of full-scale clinical trials. Sponsors would need to justify why randomized trials are not feasible and collect real-world evidence (RWE) of effectiveness post approval. The FDA could withdraw products if the small group studies are not completed or fail. The Guidance is open for public comment until April 27, 2026.
The FDA is committed to the use of RWE in the development of therapeutic products. In December 2025, they announced the acceptance of de identified RWE to streamline certain device application reviews. They are also considering updated guidance for drugs and biologics.
Impact: For ultra-rare diseases, pharmaceutical companies may gain new opportunities to develop genome based treatments when traditional randomized trials are not feasible. With an emphasis on RWE collection, technology businesses may see increased opportunities to support life sciences partners. Recent FDA decisions show a readiness to reject novel therapies where supporting evidence does not meet regulatory expectations. The streamlined clinical trial model reflects a focus on efficiency and evidentiary quality, rather than faster approvals alone. This approach signals that reduced trial complexity does not lower the FDA’s evidentiary threshold. Pharmaceutical and life sciences companies should treat this as a core consideration when designing transitional clinical trial strategies.
US: FDA launches PreCheck program to boost domestic drug manufacturing
On February 1, the Food and Drug Administration (FDA) launched the PreCheck Pilot Program. This aims to strengthen the domestic pharmaceutical supply chain by easing regulatory barriers for new domestic facilities. Priority will go to sites producing critical medications for the domestic market. The first phase will select facilities that align with program priorities and begin PreCheck activities in 2026. Selected companies will receive ongoing FDA communication during early development and earlier regulatory feedback. The program seeks to streamline reviews, support efficient inspections, and improve access to essential medicines.
Impact: The current US Administration has made it clear it wants to onshore manufacturing, to strengthen supply chains, and to bring down the cost of drugs for the domestic market. Pharmaceutical companies may want to consider applying if they're building a new manufacturing facility. This could help businesses take advantage of early FDA engagement to speed up facility development. Together with other FDA initiatives supporting national priorities they could also qualify for faster review timelines.
US: FDA updates guidance on health and fitness wearables
On January 6, the Food and Drug Administration (FDA) revised its guidance on health and fitness wearables. This included General Wellness: Policy for Low Risk Devices and Clinical Decision Support Software.
The FDA clarified that low‑risk tools like fitness apps and activity trackers remain non‑medical devices if they avoid disease claims. The updated approach aims to encourage innovation while protecting consumers from safety risks.
Devices or software providing informational estimates can avoid regulation, unless they claim medical‑grade accuracy. The FDA warned against features implying diagnosis or treatment, highlighting prior enforcement against a fitness band’s blood‑pressure estimates.
Impact: Health and fitness device manufacturers should ensure they avoid claims of diagnosis, treatment, or medical‑grade measurements unless authorized to do so. They may want to reassess any current product categories to reflect the new guidance. They should clearly position these products as wellness or informational tools to avoid enforcement action.
US: CMS proposes two payment models for Medicare
On December 21, the Centers for Medicare & Medicaid Services (CMS) announced two Medicare pilot programs to reduce patient drug costs. Guarding US Medicare Against Rising Drug Costs (GUARD) and Global Benchmark for Efficient Drug Pricing (GLOBE). The programs aim to align US drug prices with those in similar countries. The GLOBE model will use global price data to set rebates and patient costs for certain Medicare Part B drugs. These include treatments for cancer, autoimmune diseases, eye disorders and hormonal conditions. GLOBE’s trial is planned to operate for five years, starting on October 1, 2026. The GUARD model is intended for international price benchmarks for selected Medicare Part D drugs. Manufacturers pay a rebate when Medicare’s net price exceeds this benchmark. GUARD’s trial will begin on January 1, 2027, and will also operate for five years.
Consultations on the proposed rules for GLOBE and GUARD closed on February 23, 2026.
Impact: Pharmaceutical businesses should prepare for mandatory participation if the rules are finalized. They should anticipate rebates tied to international pricing, which could necessitate strong global pricing data and reporting.
US: Biosecure Act becomes law
On December 18, the Biosecure Act passed into law as part of the National Defense Authorization Act (NDAA) 2026. This was first introduced to Congress in May 2024, but failed to make it into the NDAA 2025. It restricts federal funding for biotech companies from acquiring equipment or services from foreign adversaries. Unlike earlier versions, it avoids naming specific Chinese companies. It now uses a broader definition for Biotechnology Companies of Concern, based on national security risks and foreign influence. It calls for the Office of Management and Budget to publish a list of entities one year after enactment.
Impact: The Act could impact businesses in several ways. These include businesses with US Government contracts, those in receipt of federal funding or with extensive supply chain dependency on identified Biotechnology Companies of Concern. Businesses should review processes and supply chains to ensure they are compliant with the Act. They may need to diversify partnerships and manufacturing locations.
Eversheds Sutherlands. NDAA 2026: New biotech restrictions and outbound investment controls
US: Government moves to cut prices for Medicare drug costs
On November 25, the Centers for Medicare & Medicaid Services (CMS) announced negotiated prices for 15 high-cost drugs. This aims to reduce spending by 36%, or $8.5 billion annually. The new prices will be effective January 1, 2027. Savings range from 38% to 85% based on list prices. Popular weight loss GLP-1 treatments are included.
On January 27, CMS announced the next round of negotiations for 15 more drugs. Negotiations with participating companies will take place this year with any new pricing effective January 1, 2028.
Impact: Pharmaceutical businesses could expect further government-driven price reductions and prepare for broader payer demands for similar pricing. The current US Administration has shown a willingness to get involved in lowering drug prices. Manufacturers that are able to lower prices could gain regulatory advantage with other agencies like the Food and Drug Administration. Those unable to do so could face further scrutiny or negative publicity.
US: Administration launches Genesis Mission
On November 24, US Administration launched the Genesis Mission to accelerate scientific discovery using AI. The initiative aims to create an integrated AI platform leveraging federal datasets and high-performance computing to automate research workflows and test hypotheses.
The Genesis Mission brings together labs, universities, industry, and agencies to tackle challenges in biotech, energy, and semiconductors. It has been designed to strengthen national security, boost productivity, and enhance the country’s technological leadership globally.
Impact: Companies in AI and computing are encouraged to:
- prepare for increased collaboration opportunities with federal agencies and national laboratories
- explore partnerships, data-sharing agreements, and compliance with stringent cybersecurity and intellectual property standards
- monitor emerging funding programs, fellowship initiatives, and competitive research opportunities linked to the mission
Further reading
Refunds, trade agreements, and new tariffs: What’s next after the Supreme Court struck down President Trump’s IEEPA tariffs
Proposal for an EU Regulation introducing measures to strengthen the biotechnology sector (“European Biotech Act”)
Eversheds Sutherland Life Sciences & Healthcare M&A deal highlights
Global Sustainability & ESG Insights - December 2025 and January 2026
EU Digital Omnibus: At a glance
Navigating Turbulence With Tranquility: Legal Counsel in the Age of AI, Cybersecurity, Privacy and Emerging Technology
Global Supply Chain Horizons – January 2026
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