J&J Secures Tariff Relief in Trump Drug Pricing Deal
Johnson & Johnson becomes the latest pharma giant to exchange drug price cuts for tariff exemptions, joining 14 other companies on the TrumpRx platform.
Johnson & Johnson struck a deal with the Trump administration that exchanges drug price reductions for tariff exemptions—the latest in a wave of pharma agreements reshaping how Americans pay for prescription medicines.
The deal makes J&J the fifteenth major drugmaker to participate in TrumpRx.gov, the discount drug platform that's become the administration's signature healthcare initiative. In return, J&J receives exemptions from certain U.S. tariffs that had been squeezing margins on imported components and finished products.
The Terms
J&J agreed to reduce prices on its prescription drugs to match those in comparable developed countries—a version of President Trump's "Most Favored Nation" pricing concept. The company will also extend Medicaid-level pricing to patients purchasing through the TrumpRx platform.
The practical impact: substantial discounts on blockbuster drugs like Stelara (immunology), Darzalex (oncology), and Tremfya (dermatology). American patients have historically paid two to three times more than their counterparts in Europe and Canada for the same medications.
As part of the agreement, J&J also committed to continuing its $55 billion U.S. manufacturing investment plan. That includes two new facilities: a cell therapy manufacturing site in Pennsylvania and a drug product facility in North Carolina. The $2 billion biologics plant in Wilson, North Carolina—announced last year—remains on track to create approximately 5,000 jobs.
Who Else Signed
J&J joins a growing list of pharmaceutical companies that have made similar deals:
- Amgen
- AstraZeneca
- Bristol Myers Squibb
- Boehringer Ingelheim
- Eli Lilly
- Genentech
- Gilead Sciences
- GSK
- Merck
- Merck KGaA
- Novartis
- Novo Nordisk
- Pfizer
- Sanofi
Two holdouts remain: AbbVie and Regeneron Pharmaceuticals. Both companies have said they're in discussions with the White House, though neither has announced terms.
The Leverage
Trump's tariff authority gave the administration unusual negotiating power. Pharmaceutical companies import billions in raw materials, active ingredients, and finished products from overseas manufacturing facilities. The tariffs—imposed under the International Emergency Economic Powers Act—created immediate cost pressure that incentivized participation.
J&J was among the 17 companies Trump publicly named last summer as targets for price negotiations. The company resisted longer than most peers, but the tariff math eventually made participation more attractive than continued resistance.
Critics argue the deals amount to government price-fixing that will stifle innovation. Supporters counter that Americans shouldn't subsidize cheaper drugs for the rest of the world. The policy debate will continue, but the practical reality is that prices are coming down for those who access the TrumpRx platform.
Investment Implications
For J&J shareholders, the deal removes an overhang. Tariff uncertainty had weighed on pharmaceutical stocks throughout 2025, and the resolution provides clearer earnings visibility.
The manufacturing commitments also position J&J favorably for future government contracts and regulatory goodwill. Domestic production of biologics and cell therapies addresses supply chain vulnerabilities exposed during the pandemic.
J&J shares were roughly flat on the news—the market had largely priced in an eventual agreement. The stock trades at about 14 times forward earnings, a discount to the broader S&P 500 despite the company's defensive characteristics and 3.1% dividend yield.
What It Means for Patients
The TrumpRx platform launched quietly in 2025 but has gained momentum as more drugmakers signed on. Patients can access discounted pricing by registering on TrumpRx.gov and presenting a digital card at participating pharmacies.
The discounts apply only to drugs from participating manufacturers, and not all medications are included. But for the drugs covered—particularly expensive biologics used to treat cancer, autoimmune conditions, and rare diseases—savings can be substantial.
Whether this represents sustainable healthcare reform or a temporary deal-making exercise remains debated. The broader market appears content to take the wins where they come: lower prices for patients, domestic manufacturing investment, and removed uncertainty for one of America's largest pharmaceutical companies.