I would have said that something "in the works" is in preparation, and hasn't yet started.
This translation seems unlikely to be used in English. It would be regarded as colloquial, even sloppy. Would "The negotiation is still in progress" or "The negotiation is yet ongoing" be more acceptable?
I agree, the meaning fits the Italian, even if I cannot be sure that the English is spotless. Please report that the given English sentence seems wrong and your suggestions!