We review the following eight companies: Bristol Myers Squibb, Eli Lilly and Company, Genentech, GlaxoSmithKline, Sanofi, Takeda, Teva, and UCB. You can find links to each company’s data in the appendix.
Our review found:
- Brand-name drug list prices continued to rise modestly, while mandatory and voluntary rebates, discounts, and fees reduced net prices at seven of the eight manufacturers.
- The average gross-to-net price difference was –5.5%, reflecting an average list price increase of 3.7% and an average net price decline of 1.8%.
- For the three manufacturers that disclosed these data, rebates, discounts, and other fees reduced the selling prices of brand-name drugs to less than half of their list prices.
Taken together, this year's manufacturer disclosures suggest that the gross-to-net bubble is growing more slowly—and even deflating in parts of the market. Meanwhile, the Net Pricing Drug Channel (NPDC) is becoming visible in manufacturers’ pricing disclosures and financial statements.
DATA DISAMBIGUATION
Here’s DCI's quick refresher on key drug pricing terminology:
- The manufacturer establishes the drug’s list (gross) price, called the Wholesale Acquisition Cost (WAC). A manufacturer’s gross revenues equal its revenues from sales at a drug’s WAC list price.
- A drug’s net price equals the actual revenues that a manufacturer earns from a drug after rebates, discounts, and other reductions. A drug’s net revenues equal its revenues from sales at the drug’s net price. Drug channel intermediaries—pharmacies, PBMs, wholesalers, and payers—do not have access to manufacturers' net prices.
- Rebates, discounts, and fees to commercial payers and plans
- Rebates and discounts in Medicare Part D. (Through 2024, manufacturers provided coverage gap discounts, which were replaced in 2025 by the manufacturer discount program.)
- Rebates to the Medicaid program
- Discounts under the 340B Drug Pricing Program
- Manufacturers’ payments to drug channel participants, including administrative and other fees to PBMs as well as fees and discounts to pharmacies, wholesalers, and other purchasers
- Patient assistance and copayment support funds
Drug Channels Institute coined the term gross-to-net bubble to describe the dollar gap between manufacturers’ gross and their net revenues. We use the term “bubble” to characterize the speed and magnitude of growth in the dollar value of manufacturers’ total gross-to-net reductions. Our terminology has been embraced by industry participants, the government, academic researchers, and others who analyze the pharmaceutical marketplace. For 2025, DCI estimates that manufacturers' total gross-to-net reductions for brand-name drugs reached $416 billion.
2025 GROSS-TO-NET TRENDS
The table below summarizes 2025's year-over-year changes in list and net prices for the brand-name product portfolios of the eight large manufacturers, along with reported average discounts from gross sales.
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Key observations about the manufacturers’ data for 2025:
- List-price increases remained modest. In 2025, list prices increased by 4.9% or less across all eight manufacturers. The unweighted average increase was +3.7%, closely matching SSR Health's industry-wide estimate of +3.5%.
- Manufacturers realized only about half of list prices. Only three manufacturers disclosed average discounts from list prices. Across those companies, the unweighted average discount was −51.7%, meaning manufacturers retained less than half of list prices. Weighted average discounts ranged from −46% to −56%.
- Average discounts from list prices deepened. Among the three companies reporting these data, discounts increased from prior-year levels. For example, Bristol Myers Squibb's average discount widened from −49% in 2024 to −53% in 2025.
- Net prices declined at nearly every manufacturer. The unweighted average net price change was −1.8%. By comparison, U.S. consumer price inflation was +2.6%, meaning every manufacturer except Teva recorded net price growth at or below the inflation rate. Teva was the sole exception, with a +5.1% increase.
SANOFI’S STORY
Sanofi's disclosures provide one of the clearest examples yet of how the economics of the U.S. drug channel are changing.
For many years, Sanofi has been an industry leader in disclosing its U.S. pricing policies and gross-to-net reductions. I encourage readers to review the company's excellent Pricing Principles & Perspectives materials.
We combined information from Sanofi’s historical transparency disclosures with its published financial reports to construct the comparison below.
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The divergence between rebate and sales growth is striking. From 2020 to 2025, Sanofi's estimated U.S. biopharmaceutical sales increased by $10.8 billion (+76%), while total rebate payments increased by only $1.5 billion (+10%). Consequently, the share of gross sales returned to payers as rebates declined, from 51% in 2020 to 39% in 2025.
The most dramatic change came in 2024. Like its peers, Sanofi sharply reduced the wholesale acquisition cost (WAC) list price of its highly-rebated brand-name insulin products in 2024.
Drug channels nerds know that reducing list prices can paradoxically increase a manufacturer’s net price. This occurs because the Medicaid rebate calculation and the 340B ceiling price are both intricately linked to changes in a drug’s non-rebated price relative to inflation. See Section 9.1.3. of DCI’s 2026 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers for the math behind this surprising result.
That’s exactly what happened at Sanofi. In 2024, aggregate list prices across Sanofi’s portfolio grew by 1.1%, while net prices increased by 7.4%. Excluding its insulin products, however, list prices increased by 4.5% and net prices dropped by 3%. Its commercial and government rebates dropped by $3.3 billion (–22%). In other words, lower list prices reduced rebate obligations without preventing growth in U.S. net sales.
Sanofi is only one company, and its product mix is unique. Even so, its disclosures offer an important case study of broader industry changes. As manufacturers launch more products with lower list prices and smaller gross-to-net spreads, the rebate-driven economics that dominated the past two decades are likely to become less prevalent.
LOOKING FORWARD
The traditional rebate system is coming under increasing structural pressure. The gross-to-net bubble is expanding much more slowly than in the past and is beginning to deflate in parts of the market. Legislative reforms, IRA pricing provisions, manufacturer list-price reductions, and changing competitive dynamics are weakening the traditional high-list-price/high-rebate model that has shaped formulary access and PBM economics for decades.
The 2026 data should provide an even clearer picture of whether manufacturers' pricing strategies, emerging distribution models, and evolving PBM business practices are accelerating the transition to the Net Pricing Drug Channel.
APPENDIX: BUBBLETASTIC DATA SOURCES
The following eight companies reported the 2025 changes in list and net prices for their U.S. product portfolios. Three companies also disclosed their average discounts from list prices. As always, I encourage readers to review the original source material. Here are links to the relevant reports:
- Bristol Myers Squibb 2025 ESG Report, page 37.
- Eli Lilly and Company has not yet updated its U.S. Access & Affordability page with the list price change for 2025. However, the company provided this figure directly to DCI. Lilly disclosed its year-over-year net price change for 2025 in its 2025 financial reports.
- Genentech has not updated its Science of Pricing webpage since 2021. However, Genentech privately provided the 2025 figures to DCI.
- GSK: Responsible Business Report 2025, page 10.
- UCB: Integrated Annual Report 2025, page 280.
- Johnson & Johnson will be updating its U.S. Drug Pricing Transparency Report later this summer. The company was unable to provide us with its 2025 figures before this article’s publication.
- Pfizer reported a −2% change in its portfolio’s average net price for 2025. Excluding its two COVID-19 products, Pfizer reported that average net prices declined by –5% for 2025. However, the company did not disclose a corresponding change in list prices. See Pfizer: 2025 Impact Report, page 7.
- Merck published its Merck: Pricing Action Transparency Report 2023. However, it has not released updated reports containing 2024 or 2025 data.
- Merck KGaA (EMD Serono) reported the average list price change for eight of its products, but did not report any net price changes. See SASB Index: Affordability & Pricing.
- Novartis stopped reporting “Affordability & Pricing” metrics. The company last reported gross and net price changes for 2021. See Novartis in Society – 2021 US Report, page 26.
- Novo Nordisk did not disclose any detailed pricing information in its 2024 and 2025 annual reports, despite having disclosed these data in its 2023 report. However, the company stated that “average prices after rebates for the Novo Nordisk portfolio in 2025 in the United States declined.”
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