Johnson & Johnson says net price increase of its US drug portfolio was 3.5 percent last year

Johnson & Johnson on Monday released its 2016 transparency report, which showed that the list prices of its pharmaceutical products in the US rose by an average of 8.5 percent, compared with the year before. However, the drugmaker noted that after taking into account various discounts and rebates, which totalled approximately $11 billion in the US last year, the average net price change was 3.5 percent, trailing the country's 4.1-percent medical inflation rate. 

The report, which Johnson & Johnson plans to issue annually, also pointed out that list price increases have been less than 10 percent on average over the last five years, while net price hikes have typically been below 5 percent. 

"We understand the concerns of patients, families and other stakeholders who are worried about healthcare costs, including the costs of prescription medicines," commented Jennifer Taubert, Johnson & Johnson's chairman for pharmaceuticals in the Americas, and Anastasia Daifotis, chief scientific officer for the company's Janssen North America pharmaceuticals unit. Taubert and Daifotis said "[the various stakeholders] are calling on us to provide greater transparency about how we operate, including disclosing more information on our pricing and marketing practices, our patient access programmes and our clinical trials." 

The report comes amid criticism of drug pricing in the US. In January, US President Donald Trump hinted that drugmakers could be forced to bid for government business after accusing the industry of "getting away with murder" in regards to pricing. The president later called on pharmaceutical executives to work toward lowering prescription drug prices and he has also promised to reduce regulations in a bid to hasten drug approvals. 

Earlier this year, Allergan announced single-digit price increases for several therapies, in line with its previously disclosed social contract, while Novo Nordisk and AbbVie have also recently made similar commitments. When it announced plans in January to issue the transparency report on US drugs, Johnson & Johnson said it saw no need to pledge to restrict prices given that its increases have generally been in the single-digit range.