J&J secures tariff exemption in drug pricing deal with Trump administration

Joining a long list of Big Pharma companies, Johnson & Johnson on Thursday announced that it struck an agreement with the Trump administration to provide discounted U.S. medicine rates in exchange for a grace period from the Department of Commerce’s Section 232 investigation on pharmaceutical tariffs.

The joint, voluntary agreement “meets the requests laid out by President Trump to the industry and provides the company’s pharmaceutical products an exemption from tariffs,” according to J&J’s announcement.

While J&J said the specific terms of the deal remain confidential, similar agreements recently negotiated with large pharma companies have included three-year grace periods under which their respective products will not be subject to Section 232 investigation tariffs — provided the drugmakers continue to invest in U.S. manufacturing.

According to J&J, it has more manufacturing facilities in the U.S. than in any other country and has cited domestic production and innovation as central to its long-term business strategy. As part of a previous pledge to invest $55 billion in American infrastructure, the drugmaker on Thursday announced it will build two new facilities in North Carolina and Pennsylvania.  

“The company is announcing two new U.S. manufacturing facilities, including a next generation cell therapy manufacturing site in Pennsylvania and a state-of-the-art drug product manufacturing facility in North Carolina,” according to the announcement. 

In March 2025, J&J announced plans to invest more than $55 billion in U.S. manufacturing, research and development (R&D), and technology over the next four years — a 25% increase in investment compared to the previous four-year period, according to the company. The capital expenditure also includes upgrades to J&J’s R&D infrastructure targeting oncology, neuroscience, immunology, and cardiovascular disease, along with increased technology spending to support faster drug development and workforce training.

At the time, J&J said the $55 billion investment included plans to build four additional manufacturing facilities and expand several existing locations tied to its Innovative Medicine and MedTech segments. In March, the drugmaker broke ground on a new 500,000-square-foot biologics manufacturing facility in Wilson, North Carolina, which will focus on producing therapies for cancer, immune-mediated and neurological diseases.

“Construction is progressing on our $2 billion state-of-the-art biologics manufacturing facility in Wilson,” the company said in Thursday’s announcement. “That project will create approximately 5,000 skilled manufacturing and construction jobs in the state. Johnson & Johnson is already ramping up the hiring of advanced manufacturing employees to work at the facility.”

In August, J&J also pledged $2 billion over 10 years to establish a 160,000-square-foot facility at contract manufacturer Fujifilm Biotechnologies’ new biomanufacturing site in Holly Springs, North Carolina. The drugmaker said using Fujifilm’s Holly Springs plant will allow it to further expand U.S. manufacturing capacity and the investment supports its plans to manufacture “the vast majority” of the company’s advanced medicines domestically.

In Thursday’s announcement, J&J said it expects to announce additional U.S. investments later in 2026 as the company “continues to deliver” on its $55 billion investment pledge. Large pharmaceutical companies have promised to invest more than $370 billion over the next five years in the U.S., driven by Trump’s threat of pharma-specific tariffs.